Last night’s 2003 Federal Budget was a missed opportunity to reform the New Apprenticeship scheme to ensure that it addresses acute skill shortages in the economy and provide young Australians with the skills that will improve their long-term career prospects.

The latest data shows that in the December quarter of 2002 only 6,000 people began apprenticeships in the traditional trades – the lowest number of commencements since the June quarter of 1998.

This decline in commencements comes at a time when the latest National Skill Shortage List produced by the Department of Employment Workplace Relation has identified skill shortages across a range of traditional trade occupations including carpentry, plumbing, cabinet making, panel beating and metal fabrication.

In their submission to the Senate’s Skills Inquiry, the Australian Industry Group found that: “over half of the businesses surveyed face skill shortages.”

Most of the growth in the New Apprenticeship scheme has occurred in industries where there are no skill shortages such as retail and fast food.

The skills crisis confronting the Australian economy has been caused by the financial incentive structure put in place by the Commonwealth Government, and last night’s Budget did nothing to rebalance these incentives towards the traditional trades and other areas of skill shortages.

On top of this failure, last night’s Budget actually abolished a program that was proving successful in bring schools and industry together to provide young people with the skills that will improve their long-term career prospects. The Enterprise and Career Education Foundation (ECEF) will be terminated over coming months so the Government can save a miserable $4.1 million over the next 4 years.

During hearing of the VET In Schools Inquiry being conducted by the Standing Committee on Education and Training, of which I am a member, teachers, students and employers have all praised the ECEF.

The Prime Minister’s Youth Pathways Action Plan Taskforce also endorsed the ECEF. The Taskforce found that the ECEF had made:

“a particularly strong and practical contribution to achieving a broader approach to schooling. … The Taskforce believes the [ECEF] would be an appropriate organisation to drive the shift in thinking needed to create an effective and integrated system of transition for young people from school to the wider world.”

Summary Report from the Prime Minister’s Youth Pathways Action Plan Taskforce, p4

When it comes to training the Government clearly prefers the cheapest option not the best.