Last night's Federal budget was a mixed bag for our sector.  

Below is a summary of the key skilling reforms that will have an impact on you, our Retail Employers.

Changes to Traineeships / Apprenticeships 

Australian Apprenticeships Incentives Program — better targeting
Expense ($m)

 2011-12  2012-13  2013-14  2014-15  2015-16
Department of Industry, Innovation, Science, Research and Tertiary Education  - -59.5 -99.8  -97.8  -96.8 

The Government will discontinue the $1,500 standard employer commencement incentive payment and increase the standard completion incentive by $500 to $3,000 for existing worker apprentices in non‑National Skills Needs List (NSNL) occupations. Commonwealth incentive payments paid to employers of existing workers undertaking an apprenticeship in NSNL occupations and employers of new workers undertaking an apprenticeship in non‑NSNL occupations will remain unchanged.

The Government is targeting employer apprenticeship incentives more carefully and focusing on skills shortage occupations and higher completion rates. Employers incur a range of costs in hiring new staff, and therefore it is appropriate that the incentive payment is lower for existing staff.

This measure will re‑target apprenticeship incentive payments to encourage higher completion rates for existing workers in non‑National Skills Needs List occupations. This measure will provide savings of $353.6 million over four years from 2012‑13 that will be redirected to support other Government priorities.

See also the related savings measure titled Australian Apprenticeships Incentives Program — deferral of the standard employer commencement payment.


Australian Apprenticeships Incentives Program — deferral of the standard employer commencement payment 
Expense ($m)

 2011-12  2012-13  2013-14  2014-15  2015-16
Department of Industry, Innovation, Science, Research and Tertiary Education  - -12.1 -12.1  -11.8  -11.7

The Government will achieve savings of $47.8 million over four years from 2012‑13 by changing the payment arrangements for the standard apprenticeship commencement incentive. The incentive payment will be made six months after an apprentice commences employment rather than the current three months.

The standard commencement incentive currently provides employers of apprentices at or above the Certificate III level with $1,500 and employers of apprentices at the Certificate II level in nominated equity groups with $1,250.

By separating the payment of the commencement incentive from the end of the probationary employment period, the measure will encourage the establishment of longer‑term employment relationships.

Savings from this measure will be redirected to support other Government priorities. See also the related savings measure titled Australian Apprenticeships Incentives Program — better targeting.

The above information is taken from the Australian Government Budget 2012-13 Website

In Summary

Many of these reforms are in response to the Apprenticeships for the 21st Century Report we distributed last year. The changes to commencement incentive payments and the increase in the completion incentive rate for existing workers will require employers to
  • ensure that they have a selection process that identifies committed candidates with a high likelihood of completion
  • maximise completions for current trainees to assist any initial cash flow implications from these reforms
  • immediately identify and process any employees currently eligible to participate in traineeships

Support for Mature Aged Workers 

Economic Potential of Senior Australians — Investing in Experience — Skills Recognition and Training 
Expense ($m)

 2011-12  2012-13  2013-14  2014-15  2015-16
Department of Industry, Innovation, Science, Research and Tertiary Education  - - -  - - 

The Government will broaden the eligibility of the More Help for Mature Age Workers (MHMAW) program and make changes to the payment structure to help address current levels of unmet demand.

The current MHMAW program supports the recognition of qualifications for mature age workers (aged 50 years and above) at the Certificate III level or above who have trade relevant skills but no formal qualification. It does this by reimbursing employers up to $2,000 for a skills assessment and $2,000 for training costs.

This measure expands the MHMAW program to include mature age workers from non‑trade occupations across all sectors of the economy, such as child care and business. Reimbursements to employers will also be restructured with employers eligible to claim $3,000 for the costs of the skills assessment and a further $1,000 upon completion of the gap training by the mature age worker.

To reflect these changes, the MHMAW program will be renamed the Investing in Experience — Skills Recognition and Training program. The cost of the measure will be met from within the existing resourcing of the MHMAW program.

This measure forms part of the Government's response to the recommendations of the Advisory Panel on the Economic Potential of Senior Australians.


National Workforce Development Fund — additional support for mature age workers  
Expense ($m)

 2011-12  2012-13  2013-14  2014-15  2015-16
Department of Industry, Innovation, Science, Research and Tertiary Education  - 5.0 10.0  10.0
 10.0 

The Government will provide an additional $35.0 million over four years to the National Workforce Development Fund (NWDF) to improve the skills of mature age workers, aged 50 years and over, consistent with their workforce development needs.

In accordance with the NWDF program guidelines, organisations will be required to make a co‑contribution of between 33 and 66 per cent of the cost of training provided to their employees depending on the size of the enterprise.

The NWDF was established in the 2011‑12 Budget as part of the Building Australia's Future Workforce package to support training and workforce development in areas of current and future skills need. The NWDF forms part of the Australian Government SkillsConnect network, which was announced on 21 September 2011 to consolidate Government skills programs and better target training to meet industry and employer needs.

The above information is taken from the Australian Government Budget 2012-13 Website
In Summary

These reforms highlight the commitment by the Government to maximise workforce participation by mature age workers and provides employers with an opportunity to support and engage them. The existing initiatives have been expanded to include retail and along with the inclusion of the Experience+ program and the Jobs Bonus incentive for employment of staff over 50, the focus on this cohort is well supported. Employers should consider how mature aged workers might feature as part of their workforce planning and development strategies.
Conclusion

These changes will require a comprehensive and targeted approach to workforce development by employers and a change to current models for participation in Government supported training.

With the current changes to funding models being rolled out in each state favouring the introduction of a student entitlement to a minimum of Certificate III level training, plus the funding available to employers and their RTO through National Workforce Development Fund projects, fir believes that employers committed to the development of team members in meaningful programs will continue to be supported.

Those with mature aged workers, high completion rates, school based programs and established workforce development plans look best placed to benefit. fir will work with employers to develop models that support capability development that is aligned to business objectives and to maximise available funding.

As we gather more information and further analyse the budget announcements we will provide updates to you. In the meantime, as ever, we welcome your questions and ask that you contact Maxine Cheilyk or Carmel Davy on 1800 644 332.

A full outline of all measures in the tertiary education and training sector can be found here
www.budget.gov.au/2012-13/content/bp2/html/bp2_expense-15.htm