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CUTTING RED TAPE - NEW APPRENTICESHIPS BUSINESS INCENTIVES SIMPLIFIED

I am pleased to announce major new initiatives to further simplify the process for businesses which employ and train New Apprentices.

The New Apprenticeships Incentives Programme encourages employers to take on New Apprentices by paying financial incentives at key points during the training.

The changes I am announcing today will ensure a stronger focus on New Apprentices completing their training.

Under the current arrangements employers claim Commonwealth incentive payments up to three times during the training of their New Apprentice – at ‘commencement’, ‘progression’ and ‘completion’.

These three payments will be consolidated and simplified. The progression payment will be redistributed, with 20% when they sign on and 80% payable to employers when New Apprentices complete their training.

This will provide a greater incentive for employers to ensure their New Apprentices complete their training as well as reducing paperwork and red-tape.

The Government is committed to continuing to support New Apprenticeships in rural and regional Australia - where more than a third of New Apprentices are employed.

The Incentive for Rural and Regional Skills Shortages will be paid at the commencement of Australian Qualifications Framework (AQF) III and IV rather than at progression from AQF II to AQF III or IV. The Living Away From Home Allowance will be increased to $77.17 per week (in line with increases to the National Training Wage) and this allowance will be extended to second year and paid at half the rate. These two measures will greatly assist non-metropolitan employers and their apprentices.

There are also extra incentives to support disadvantaged mature aged workers. An additional $825 will be paid at commencement and another $825 on completion for New Apprentices over 45 years old who are welfare dependant, returning to the workforce or have been made redundant.

Many employers have commented that incentives were not payable where a prior vocational education and training (VET) qualification existed, which was outdated or not directly relevant to the job.

This concern has been addressed and it will now be easier for employers to take on New Apprentices who have redundant qualifications. People with VET qualifications that are more than seven years old or have qualifications that have been obtained while at school, will now be able to attract incentives for their employers.

Payments to Group Training Organisations (GTO) have also been simplified.

All Group Training Organisations will now be eligible for the same incentives as other employers. At present, unlike other employers, not-for-profit GTOs are not able to access completion payments.

The special commencement incentive for eligible Group Training Organisations for trainees will also be phased out over two years and replaced from 2004-05 with a payment for New Apprentices who complete an AQF II qualification with a Group Training Organisation. This measure recognises the special role Group Training Organisations play in mentoring New Apprentices, especially in equity groups, and does away with the differential treatment of trainees and apprentices.

The Disabled Apprentice Wage Subsidy will be extended to trainees so that all New Apprentices can access this important assistance. Currently, it is only available to apprentices.

New Apprenticeships are already available in more than 500 occupations. At 30 June this year, there were 362,100 New Apprentices in training - up from 152,700 in March 1996.

These changes announced today will take place from 1 July 2003, other than the new completion payment for GTOs which will begin in 2004-05. The attachment provides more information. In addition to these key changes there will be some fine tuning of other elements of the programme.

*A Review of the Programme began in April this year and was informed by consultations in capital cities and regional centres. More than 100 written submissions were received. A full report on the Review will be available on the New Apprenticeships website during October. http://www.newapprenticeships.gov.au/naip/index.asp.

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CUTTING RED TAPE - NEW APPRENTICESHIPS BUSINESS INCENTIVES SIMPLIFIED

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