November – Group Training Fund Axed

Extract from an article by John Ross, The Australian, 14 No4 2014

GROUP training organizations are reeling at the federal government’s decision to scrap their key funding scheme.
The government announced last week that it would cut commonwealth funding to the $12.5 million Joint Group Training Program by 20 per cent this financial year, with the remaining 80 per cent to go in 2015-16.

The announcement caps a rocky period for the JGTP, which appeared doomed after NSW and Tasmania withdrew their support. But then federal skills minister Chris Evans threw the scheme a lifeline by maintaining Canberra’s allocation to the jointly funded program despite the biggest state’s withdrawal.

Coalition MP Bob Baldwin, who addressed the Group Training Australia annual conference in Hobart on Thursday, said the latest move had not been taken lightly. “But in times of budget constraints and sector reform difficult decisions needed to be made,” said Mr Baldwin, who is parliamentary secretary to Industry Minister Ian Macfarlane.

“This decision was reached in the context of the wider apprenticeship reform we’re undertaking, in particular, the introduction of the new Australian Apprenticeships Network.”

GTOs are mystified at the rationale behind the program’s sudden scrapping six months after the government terminated ten other vocational education programs in the May budget.

GTOs act as de facto employers of apprentices and trainees, helping to ensure their work and training progress smoothly, and taking care of paperwork and payroll tax. They help boost take-up of apprenticeships by providing an alternative for employers unwilling to assume the administrative workload.

They also help prevent attrition by ironing out problems in the workplace and by taking on apprentices whose employers have gone out of business.

Non-completion runs at close to 50 per cent in apprenticeships — an issue the government claims is a major driver of its reforms.

With small businesses struggling to meet the costs of outsourcing administration of their apprentices, GTOs have relied on government funds to supplement their revenue. The JGTP has been considered small fry in the vocational education budget, with far more spent on employer subsidies.

Mr Baldwin told the conference the government appreciated the role group training had long played “in recruiting and employing apprentices (and) providing support to assist them in finishing their trade”. He said the government’s focus was not on training organisations as an interest group, but on “outcomes which arrest the attrition and (low) completion rates of apprentices”.

“We know that GTOs will continue to deliver vital, high quality services to employers and apprentices well into the future,” he added.

GTOs’ access to government funding now appears to depend on their success in tendering to the Australian Apprenticeships Support Network, which is due to commence next July.

Andrew Lawler, who heads the Industry Department’s Skills Funding and Apprenticeship Policy Branch, told the conference the department had borrowed heavily from GTO practices in designing the new network.

Sorce: John Ross, “Group training fund axed”, The Australian, 14 No4 2014