House of Representatives

Second Reading Speech

Mr O'Connor (Minister for Skills and Training)

I move:

That this bill be now read a second time.

Today I am introducing the Trade Support Loans Amendment Bill 2023.

This bill amends the Trade Support Loans Act 2014 to expand access to income contingent loans to more Australian apprentices and trainees working in high-priority occupations of skills need, as determined with regard to advice from Jobs and Skills Australia. For the first time, this will include non-trade occupations. The bill also proposes administrative changes to make the program fairer and more effective.

Trade support loans are interest-free, income contingent government loans that currently support apprentices in priority trade occupations with cost of living while they are completing their training. As an incentive to encourage completion of training, apprentices who complete their apprenticeship, are eligible for a 20 per cent discount on their trade support loan.

Since introduction in July 2014, the Department of Employment and Workplace Relations (DEWR) estimates that trade support loans have helped over 167,000 apprentices, who may otherwise have struggled to complete their apprenticeship.

Data on completion rates provided by DEWR shows that recipients of trade support loans are more likely to complete their apprenticeship. Since the program's introduction in 2014, completion rates for apprentices who have taken out trade support loans have been around 10 percentage points higher than completion rates for all trade apprentices.

Australia is currently facing the most significant skills shortages in decades, and the measures in this bill are a practical way that we can extend the benefits of a trade support loan to more apprentices and trainees. It will support them to continue - and to complete - their qualifications, so that they can gain secure work in areas of greatest need for the economy.

This bill will expand eligibility for trade support loans to apprentices and trainees working in critical occupations specified on a new priority list. The bill provides the flexibility for the list to include occupations in early childhood education, aged care, and disability care. This means occupations such as enrolled nursing, personal care assistants, therapists, dental technicians and many more would have access to financial support to continue their training, and an incentive to complete.

Beyond the care sector, other examples of occupations that could be eligible include veterinary nurses, aircraftmaintenance engineers, civil engineering technicians, gardeners, youth workers, swimming coaches, chefs and many, many others.

The bill will achieve this by replacing the existing Trade Support Loan Priority List, with a new Australian Apprenticeships Priority List, which will be more relevant and responsive to the needs of the economy.

The outgoing Trade Support Priority List restricts access to the loan program to apprenticeships leading to qualifications in a limited group of trade occupations. The list of eligible occupations has not been updated since the scheme was implemented. It is out of date and no longer aligns with the range of Australia's current and future skill needs.

The new Australian Apprenticeships Priority List will be responsive to new and emerging skills shortages, and will significantly expand the list of occupations that have access to the program. Importantly, the bill will extend eligibility to non-trade occupations for the first time - critically including those in the care sector.

To reflect the new scope of eligibility, this bill renames the Trade Support Loans Program to the Australian Apprenticeship Support Loans.

By extending eligibility, the bill will assist many women, as women predominantly take up non-trade apprenticeships and traineeships. According to the latest data from the National Centre for Vocational Education Research in September 2022, 76.8 per cent of women in apprenticeships and traineeships - that is, 95,335 women - are in non-trade occupations.

In determining the occupations on the new Australian Apprenticeships Priority List, the bill requires me (as minister) to consider the advice of Jobs and Skills Australia.

Jobs and Skills Australia will leverage its strong team of specialists including labour market economists, data scientists, analysts and researchers to provide independent, expert advice to help determine the new priority list.

Unlike the current list, the new Australian Apprenticeships Priority List will be updated at least annually. As a result, the list will be responsive to the current, emerging and future skills and training needs in the workforce.

The bill will also provide greater flexibility and fairness in the administration of the loan program. It provides discretion to the secretary of the department to accept late applications for loans, if appropriate in the circumstances. This could include where an administrative error or exceptional circumstances have disrupted an eligible apprentice's loan application. This ensures that immediate financial support is not unnecessarily or unfairly denied.

The Albanese government is working with our partners to rebuild and modernise our vocational education sector. In partnership with states and territories, we're delivering 180,000 fee-free TAFE and vocational education places in 2023, with a further 300,000 places to become fee-free from 2024.

The Albanese government is working to remove the barriers Australians face in their accessing life-changing education and training and ensuring that Australians from all backgrounds and cultures are supported to achieve their full potential.

This bill, and the new Australian Apprenticeship Support Loans program will join those reforms to help Australia and Australians to meet our current and future skills needs.

I commend this bill to the chamber.

Debate adjourned.