Investing in local training to address skills shortages
As noted in Chapter 2, it is a requirement that businesses employing
workers on temporary short stay (TSS) visas (as well as the previous 457 visa)
make a contribution towards the training of Australian workers.
This chapter examines the introduction of the Skilling Australians Fund,
the mechanism through which this contribution is currently made by employers.
Broader issues relating to the training of Australian workers in order to
address local skills shortages in the medium and long term are also considered.
The Skilling Australians Fund levy
Prior to August 2018, training benchmarks under the 457 visa program
required sponsors to demonstrate expenditure on training Australians by:
- spending at least two per cent of their payroll in payments to an
industry training fund operating in the same or related industry; or
- spending at least one per cent of their payroll on training to
Australian citizens or permanent residents employed in the business.
This requirement was replaced with the Skilling Australians Fund (SAF)
charge in August 2018. The SAF requires sponsors to pay a levy upfront whenever
they lodge a nomination application for a TSS visa. The levy cannot be
recovered from or passed onto another person, including the sponsored employee. It is designed to place a requirement on employers who sponsor overseas skilled
workers to contribute towards the broader skill development of Australians.
The SAF is used to train Australians and requires joint investment by
state and territory governments. Allocation of resources from the SAF is
prioritised towards traineeships and apprenticeships, with the objective of
supporting Australia's future productivity, jobs and growth between 2017 and
2022 through this targeted training funding.
A joint submission from the Department of Home Affairs, the Department
of Jobs and Small Business and the Department of Education and Training (Joint Departmental
Submission) described the effect of the SAF to date:
The renewed focus on apprenticeships and traineeships is
boosting the number of people who choose and succeed in this pathway and
helping businesses to gain the skilled workers they need to drive innovation
and growth and address skills shortages.
The framework for the SAF is established by the Migration (Skilling
Australians Fund) Charges Act 2018 and the Migration Amendment (Skilling
Australians Fund) Act 2018 (the SAF Acts).
All businesses nominating overseas workers for employer-sponsored visas
are required to pay the SAF levy. This applies to TSS visas, Employer
Nomination Scheme (ENS)(subclass 186) visas and Regional Sponsored
Migration Scheme (RSMS)(subclass 187) visas. The levy also applies to ENS
and RSMS permanent visas.
The Department of Home Affairs collects the levy, but the Fund itself is
administered and allocated by the Department of Education and Training. The levy
amount is set at the following rates for employers sponsoring workers for a TSS
- $1200 per nominated overseas worker per annum for small
businesses with an annual turnover of less than $10 million.
- $1800 per nominated overseas worker per annum for businesses with
an annual turnover of $10 million or more.
Businesses must also pay a one-off SAF levy payment when lodging a
nomination application for an overseas worker for the ENS and RSMS permanent
visas. The payment rates for each nominated overseas worker in these
circumstances are: $3000 for small businesses with an annual turnover of less
than $10 million; or $5000 for businesses with an annual turnover of $10
million or more.
Between its introduction in August 2018 and 31 January 2019, the
Department of Home Affairs collected $90.3 million in SAF levy payments. According to the Department of Education and Training, the levy-reliant budget
for the Skilling Australians Fund for the relevant year is $243.4 million, indicating there will be a shortfall. This suggests that projections by the government
indicating that the SAF levy will raise $1.2 billion in revenue over
its first four years may not be reliable.
The Australian Government invested around $187 million in the first year
of the Fund, from a budget of $300 million. The Joint Departmental Submission stated:
In June 2018, the first year of the Fund, the Australian
Government invested around $187 million to support approximately 50,000
additional apprentices, trainees, pre-apprentices, pre-trainees and
employment-related training commencements. The additional training
opportunities delivered in 2017–18 by the states included a range of innovative
and successful employer and apprentice incentives across occupations in demand
and sectors of future growth. State projects had matched funding and
demonstrated engagement with, and support from, key industry and employer
Under amendments made by the Senate during the passage of the SAF Acts
in 2018, the operation of the SAF will be the subject of an independent
review. This review is due to commence in November 2019 (18 months after the
SAF Acts received Royal Assent) and is to be completed within six months.
National Partnership Agreement on the Skilling Australians Fund
Between 2018 and 2022, the Fund will be managed through a National
Partnership Agreement on the Skilling Australians Fund (NPSAF, or the
Agreement). The objective of the Agreement is 'to improve employment outcomes
by supporting Australians to obtain the skills and training they need for jobs
in demand through increasing the uptake of apprenticeships, traineeships and
employment related training'.
The Victorian and Queensland governments have not signed the NPSAF due
to its instability and inadequacy.
Through the Agreement and bilateral agreements with each state, states
are able to develop projects which support additional apprentice, trainee and
employment-related training in agreed priority areas including:
- Occupations in demand.
- Occupations with a reliance on skilled migration pathways.
- Industries and sectors of future growth that include, but are not
limited to, the following priorities: tourism, hospitality, health, ageing, and
community and social services, engineering, manufacturing, building and
construction, agriculture and digital technologies.
- Trade apprenticeships.
- Rural and regional areas.
- Targeted cohorts.
- Industries and communities experiencing structural adjustment.
The Joint Departmental Submission stated that projects funded under the Agreement
must demonstrate that they have support from and will engage with industry and
Industry is a key partner in ensuring that training delivers
the skills industry needs and that skills spending is targeted to jobs in
The Department of Education and Training provided evidence on how the
Agreement is being implemented, specifically looking at:
- the number of project proposals submitted by the states and
territories for funding under the Agreement;
- the number of project proposals approved, still being considered
or rejected; and
- the nature and value of the proposed projects.
The committee was informed that the Northern Territory submitted two
project proposals, while other state and territory governments submitted one. In terms of project approval:
All project proposals submitted by signatory states as a part
of the bilateral schedules under the NPSAF have been approved. Discussions were
held with the states during the negotiation period to agree bilateral schedules
to ensure the parameters of agreed projects met the requirements outlined in
The Department of Education and Training also provided high-level
information on the projects in question, broken down by state and territory, as
shown in Table 5.1.
Table 5.1 – Projects approved under
contribution in 2018–19
Smart and Skilled Apprenticeship and Traineeship and Complementary Training
and Skills WA
South Australia Initiative
Australia’s Capital Region
1: Territory Workforce Program
2: NT Pre-employment Training Program
Stakeholder views on the Skilling Australians Fund levy
Views on the SAF levy varied among submitters and witnesses. Key issues
brought to the attention of the committee included: the quantum and timing of
the SAF levy payment; and the availability of SAF levy refunds.
The quantum and timing of the SAF
The quantum of the SAF levy was identified as a major concern for
business, with some submitters arguing that it is excessive and only
exacerbated by the upfront nature of the payment. This, the Australian Chamber
of Commerce and Industry (ACCI) stated, only adds to the already
considerable burden placed on small business. ACCI called for the levy to be
halved to $600 and $900 per year for each sponsored temporary migrant for small
and large business respectively.
Business SA described the SAF levy as 'hefty', and submitted that this
cost was contributing to making it financially unviable for businesses to hire
short-term workers when they are urgently needed.
This view was echoed by Restaurant and Catering Australia (R&CA),
which described the levy as a 'significant frustration' for business owners:
The cost impost, as well as the upfront nature of the SAF
levy, have significantly disincentivised businesses' from attempting to hire foreign
workers on skilled visas. In order to resolve this issue, R&CA believes
that the quantum of the Skilling Australians fund levy should be reduced by
50 per cent to reduce the cost burden for businesses in sponsoring a
skilled visa applicant.
Like ACCI, R&CA did not support the requirement for SAF
contributions to be made upfront, instead calling for the introduction of
As is the case with many small businesses across a number of
different sectors, cash flow is a significant issue and the upfront nature of
the SAF levy is creates a cost burden that inhibits participation.
While R&CA called for the levy to be halved, the organisation would nonetheless
like to see existing funding for the SAF maintained at its current level
through increased government contributions:
R&CA believes that it is necessary for the Commonwealth
Government to make a stated commitment to maintain funding at current levels
for the Skilling Australians Fund regardless of the level of money generated
from the SAF levy.
Other submitters saw distinct benefits to the cost of the levy, however.
The Migration Council of Australia submitted that ensuring employers pay
more to hire a foreign worker has an protective effect for Australian job
The contribution not only funds national training initiatives
for Australians in areas of need, it also serves as an assurance that employers
are willing to pay extra to hire a foreign worker. This is an important part of
ensuring the programme achieves its objective of also protecting Australian job
The committee explored issues around the cost of the SAF levy with
witnesses from the Department of Home Affairs. The levy, the committee heard, was
designed to find a balance between imposing a cost on bringing in workers from
overseas and enabling business to meet skills needs:
Some of the reforms have put a price into the marketplace, if
you like, around the SAF levy. So if an employer brings in a worker on a TSS
visa, they now make a contribution to the Skilling Australia Fund. That puts an
additional price into the labour market. It sends a signal into the short-term
labour market to say: if you have a genuine need to attract skills and you've
done all the right things—you've done the labour market testing; you are going
for an occupation that is identified as one of the areas we have a shortage in—then
you will have to pay these costs to bring in the worker. It is a balance. It is
not so onerous that it makes it impossible for business to get those needs met
to grow the business but it is not free either, so it is striking a balance.
The Department of Home Affairs also commented on the timing of the SAF
levy payment, explaining the rationale for collecting the levy at the time the
sponsor lodges a nomination as follows:
Payment of the Skilling Australians Fund levy at the time of
lodgement of a nomination seeks to minimise the administrative cost to sponsors
and the Department of Home Affairs (the Department), by removing the need to go
back to the sponsor for collection of any payable fees during the assessment
Levy refunds and exemptions
Refunds of the SAF levy are only available in limited circumstances.
Examples include where:
- the visa application is refused on health or character grounds;
- the visa holder fails to commence employment in their nominated
- (for applications lodged after 17 November 2018) the TSS visa
holder ceases within the first 12 months of employment in their nominated role
(if the visa was approved for a period of 24 months or more); or
- the nomination application is withdrawn from processing in
The Law Council of Australia submitted that nomination application
refusal rates have increased, however the levy is not refunded if nomination
applications are refused. This is, in the Law Council's view, unreasonable considering that the employer
receives no benefit from the employee in these circumstances:
The SAF levy was intended to be a quid pro quo in
exchange for being permitted to sponsor overseas workers. For employers whose
nomination applications are refused, the Law Council submits that it is
unreasonable to retain the SAF levy from an employer as they fail to derive any
benefit from the TSS program.
Industry representatives such as the Australian Chamber of Commerce and
Industry (ACCI) agreed, recommending that refunds should be possible in all
cases where an application has not been successful.
It is currently unclear what quantum of funds has been raised through
SAF levy payments where the visa nomination was rejected. When questioned
on what percentage of funds raised by the SAF levy has been collected in such
cases, the Department of Home Affairs stated that it does not sufficiently
disaggregate data about the payments to be able to answer this question:
The Department of Home Affairs Financial Management
Information System...reports on aggregate revenue collected. It does not capture
or report this revenue disaggregated by nominations and/or visa applications
that have been rejected. A significant investment in resources would be
required to build this capability[.]
Exemptions for essential service
The importance of public service industries such as hospitals and
education institutions providing an appropriate level of service to all Australians
was also brought to the committee's attention in the context of skills
shortages and the SAF levy payment. The Migration Council of Australia
suggested that industries providing essential public services could be made
exempt from the SAF levy in order to ensure they can fill shortages more
Effect of the SAF levy on
employers' training activities
A number of stakeholders cited concerns around the impact of the SAF
levy on employers who already make a significant contribution to training staff.
In the view of one specialist management consultancy, this amounts to paying
for training twice and creates a distinct disadvantage for some employers:
This 'double whammy' has created a disincentive for employers
to train and engage apprentices as they will be required to pay again for each
overseas skilled worker via a training levy under the SAF, anyway. The training
levy under the SAF also puts these employers at a financial disadvantage
compared to those employers who do not train, but are only required to pay the
The Law Council of Australia suggested that this could be mitigated by
modifying the SAF for businesses already contributing significantly to the
training of local employees. In effect, this would enable sponsors to offset
their SAF levy liability by demonstrating and claiming actual expenditure on
The ACCI's submission also supported a mechanism that allows employers
showing demonstrated training expenditure to be exempted from the SAF levy:
Under the previous training benchmarks, there was an option
for employers to demonstrate that they invested in training by proving that
they spent equivalent of 1% of payroll (benchmark) or more on training. We
support this avenue of demonstrating a commitment to training and that in these
circumstances an additional levy is not payable.
These views were echoed by Business SA, which described the levy as
inflexible and argued that its real cost is borne by businesses which could
previously demonstrate investment in training:
Under the previous system, businesses had to either put the
equivalent of two per cent of their payroll into an Industry Training Fund, or
demonstrate that they were spending the equivalent of one per cent of their
payroll to train workers who were Australian citizens or permanent residents.
All businesses spend money on training their staff; it is a necessary
expense to ensure staff have the correct accreditations and knowledge to
perform their role. Now, under the new system (which calculates fees based on
turnover rather than payroll), those businesses would have to pay an upfront
training levy of $4,800 for a worker eligible for a four year subclass 482
visa, on top of the money they would already spend on training.
Ensuring that SAF funds contribute towards local skills needs
Investment in training is crucial to ensure that Australian skilled
workers enter and remain in industries experiencing skills shortages.
During the inquiry, the committee considered how to ensure that funds from
the SAF contribute towards the development of targeted local skills that
address labour market shortages. In particular, the committee examined what safeguards
are in place to ensure that projects approved under the Agreement contribute to
the alleviation of genuine skills shortages, ultimately decreasing businesses'
need to employ overseas workers on temporary skilled visas. When questioned on
this issue, the Department of Education and Training commented as follows:
The National Partnership on the Skilling Australians Fund
(NPSAF) requires the Commonwealth Minister to consider the consistency of each
project with the objectives and outcomes of the NPSAF when assessing project
proposals, and the extent in which the project has delivered additional
training in agreed priority areas, including occupations with a reliance on
skilled migration pathways as per clause 29 of the NPSAF.
The committee further explored with the department the broader question
of what accountability mechanisms the Commonwealth requires to ensure that
state and territory training initiatives are being implemented in a way that
addresses skills shortages. Representatives of the department stated that it is
difficult for the Commonwealth to maintain oversight of whether the states are
being responsible in balancing the need to bring in a temporary migrant
workforce, with the need to actually addressing their long-term skills needs
through training initiatives.
Arguments that SAF funds should
benefit industries proportionately
Some industry representatives submitted that the system for allocating
SAF funding will not necessarily meet industry needs. As put by the
Minerals Council of Australia (MCA):
Noting industry investment to training and education and
commitment to apprenticeships and traineeships, along with the significance of
industry to regional employment, the policy perspective and parameters of the
levy imposed to raise revenue for the Skilling Australians Fund fails to
achieve the demand-driven and industry-led imperative proposed.
The MCA added that, in its view, overseas workers are already seen as a
last resort by the industry, and the contribution of temporary skilled visa
holders to the minerals industry 'cannot be traded off to meet other
governmental objectives'. This is especially the case, the MCA submitted, when there is no guarantee that
funds raised through the SAF system will be invested back into the relevant
industries, such as mining. To address this, the MCA suggested:
With the challenges of practical application and allocation
of the fund, in particular the perceived cross-subsidisation of other industry
sectors, the MCA suggests funds be allocated proportionally to each industry's
use of the temporary skilled migration visas to support skilling and upskilling
for that and ancillary industries.
The MCA concluded that although training outputs generated through
the SAF have not demonstrated a direct effect on skills availability, the
industry's investment in training would continue unabated.
Other proposals for ensuring that training outcomes are achieved
The committee heard other suggestions about how to ensure that employers
utilising temporary skilled visa workers are contributing to local training
This issue was explored in some depth by the Construction, Forestry,
Maritime, Mining and Energy Union (CFMEU) in its submission. The union
submitted that the skilled visa scheme is in fact being used by some employers
as an alternative to training and educating apprentices:
Abella (2006) argued that employers will always have a need
for foreign workers if they can lower their costs by doing so. If employers can
meet their labour needs while reducing their costs (including training costs)
by employing temporary overseas workers their incentive to invest in an
apprentice is reduced.
Other research cited by the CFMEU similarly found that:
...increasing the ease by which temporary overseas workers can
be hired creates an alternative supply of trade labour which incentivises
employers to engage temporary visa holders rather than invest in educating
These findings, the union submitted, can also be seen in research
conducted by the Productivity Commission:
Even the Productivity Commission (2015) found that the supply
of qualified workers, including migrant workers, affects employers' incentives
to invest in training an apprentice or trainee, especially if employers can
quickly and cheaply fill vacancies from overseas workers.
The CFMEU stated that employers can only be incentivised to fill skills shortages
by focusing more on training Australians—relying on workers from overseas as a
last resort—in a limited number of ways:
In order for employers to train locals rather than engaging
overseas labour, it needs to be more profitable to invest in education, which
is rarely the case. Failing this, the Government needs to place restrictions on
the use of temporary overseas workers, or at a minimum impose additional
requirements on employers utilising overseas workers to invest in education
The SAF levy, the union concluded, is an insufficient incentive for
employers to invest in training Australian workers. Accordingly, the CFMEU recommended:
Employers who have a genuine need to sponsor overseas workers
must be required to educate local workers to reduce their need to rely on
temporary overseas workers in the future. Employers should be required to train
workers and employ apprentices in the same occupations where they are using
skilled overseas workers.
The Australian Nursing and Midwifery Federation suggested similarly that
the Commonwealth could implement a policy that if an employer is going to
access a temporary skilled visa worker, they must also take on a graduate. Representatives from the Australian Meat Industry Employees Union agreed that
if businesses employ an overseas temporary worker, they should also be required
to employ a local apprentice or trainee.
Ms Adrienne Rourke, General Manager of the Resources Industry Network,
told the committee at its Mackay public hearing that this kind of requirement
could be used in place of the SAF levy, to ensure that local benefits are being
Another point that was raised by quite a few members [of the
Resources Industry Network] is that they see the skills training levy as being
a revenue-raising exercise. From our economic development and my perspective,
I'm still to see how that's going to work to the benefit of our region and what
actual funds are going to come back specifically to us. Our members are paying
money towards that if they're bringing in people through that visa system.
We're obviously always parochial about this, but we'd like to see that direct
money coming back on the ground to help businesses here with apprenticeships. A
solution that was put forward in this process was: would it not make more
sense, when you bring in one overseas skilled worker, to have to match them
with an apprentice within the business? In that way, the business itself is
responsible for the apprenticeship.
The Australian Workers' Union argued more broadly that the current trend
in TAFEs closing and the number of apprenticeships dropping to an all-time low
should be actively reversed in order to shift focus back onto increasing local
Investing in programs to improve
employment outcomes of other migrant cohorts
The committee heard evidence that it would be beneficial for the
Commonwealth to proactively support and promote industry programs and
partnerships that assist other cohorts of visa holders in Australia with work
rights, for example permanent humanitarian entrants, to achieve better
employment outcomes. While it appeared that some individual initiatives were
working well in this space, there was support by industry for greater
coordination and resourcing at a national level.
The committee notes that stakeholders have raised concerns relating to
the SAF levy, particularly its payment structure and impact on businesses'
other training activities. The committee recognises that the quantum of the SAF
levy must be viewed in the context of competing interests, namely, the need to
allow business the flexibility required to fill skills shortages quickly when
necessary, and the need to ensure that their ability to do so does not
indirectly act as a disincentive for adequate investment in training.
The committee further notes that the SAF levy was only introduced in
August 2018. The committee therefore considers that the government should
complete an evaluation of the effectiveness of the SAF levy parameters by the
end of 2019, when enough time will have passed for the levy's initial impact on
skilled visa uptake and industry concerns to be more accurately ascertained.
The committee notes that the government's National Partnership on the
Skilling Australians Fund (NPSAF) is primarily reliant on levies collected
under the SAF and that the budget for the NPSAF is not guaranteed. The
government has stated that it will not top up any shortfall between SAF revenue
and the NPSAF budget. The committee also notes that in the first six months of
the levy, $90.3 million was raised, and that the government has budgeted for $243
million in levy revenue in the relevant year of the NPSAF. Based on those
figures, $150 million would need to be collected in five months to meet that
budget. As it stands, the revenue collected by the SAF levy is falling
significantly short of the government's original projections.
Stakeholders in a previous Senate committee inquiry into the Migration
Amendment (Skilling Australians Fund) Bill 2017 and the Migration (Skilling
Australians Fund) Charges Bill 2017 were highly critical of the design of the NPSAF
and its heavy reliance on an insecure and fluctuating revenue source. Many
submitters, including the Australian Chamber of Commerce and Industry, the Business
Council of Australia and the Australian Council of Trade Unions (ACTU), called
for the NPSAF to have secure and sufficient funding guaranteed.
Perhaps unsurprisingly, the government has failed to secure agreement
regarding the NPSAF with either the Victorian or the Queensland governments and
both governments have refused to sign on to the NPSAF due to its flaws. Those
two states account for 45 percent of current apprentice and trainee activity,
leaving a large hole in the government's national funding for vocational
education, apprenticeships and skills development.
The committee notes that education funding expert Professor Peter
Noonan, professorial fellow at the Mitchell Institute for Health and Education
Policy, has independently observed the contradictions inherent in the Skilling
Australians Fund design, and predicted that the Fund design would pose a
barrier to settling agreements with the state and territory governments:
Revenue for the fund will be highest when skilled migration
is highest, and lowest when employment of locally skilled workers is highest.
That means the revenue stream for the fund will be counter-cyclical to the
purpose for which is was established: [to] increase the proportion of locally
trained workers and to lessen reliance on temporary skilled migration visas.
Unless the Commonwealth guarantees funding levels and continues to make up any
shortfall in the revenue, it will be difficult, if not impossible, for the
Commonwealth to enter meaningful, bilateral agreements with the states through
The committee is gravely concerned that the design and the revenue
raised by the government's visa scheme will not be sufficient to meet the
Skilling Australians Fund budgeted expenditure or the emerging skill
acquisition demands of a modern economy.
The committee recommends that the Australian Government guarantee
adequate, additional funding if the income from Skilling Australians Fund
levies does not meet the needs of industry and the vocational education sector
to provide high-quality training to apprentices and trainees.
The committee notes that it is the strong view of stakeholders and
experts that there are serious flaws in the vocational education system that are
limiting our national productive capacity.
The Productivity Commission's Shifting the Dial: Five Year Productivity
Review reported that 'the VET system is a mess' and that:
Despite its important but complex role, the VET sector has
been beset with a raft of problems leading to a sector characterised by rapidly
rising student debt, high student non-completion rates, poor labour market
outcomes for some students, unscrupulous and fraudulent behaviour on the part
of some training providers. These outcomes report a range of problems in the
In contrast to assertions by the current Minister for Skills and Vocational
Education, Senator the Hon. Michaelia Cash, and her predecessor the Hon Karen
Andrews MP, that the vocational education system is world class and superior to
the German system, a 2017 Organisation for Economic Cooperation and Development
(OECD) report on skills and global value chains shows Australia is poorly
positioned in terms of skills characteristics to capitalise on opportunities in
global value chains, and would struggle to meet the requirements of the
technologically advanced sectors.
The Business Council of Australia (BCA) is calling for 'systemic and
transformational change' across education, but in higher education and vocational
education and training (VET) in particular. The ACTU maintains that 'a significant wholesale reform of the VET sector is
necessary to ensure the VET system can reliably deliver quality training for
the jobs of the future'.
The government has been incapable of properly assessing and developing
the policies and systems that would reverse the decline and effectively deal
with the concerns raised by stakeholders. Instead the government has introduced
a flawed National Partnership Agreement, cut funding to vocational education by
more than $3 billion since taking office and presided over a decline of
140,000 apprentices and trainees since taking office.
The committee believes that a comprehensive review of the sector is
required to ensure that Australians are able to equitably access effective,
relevant and high quality vocational education and training.
The committee notes that after almost six years in government, the
Coalition has appointed a former New Zealand National Party Minister to conduct
a perfunctory and truncated review of VET system within an unacceptably short
timeframe. This review will have no prospect of dealing with the complex problems plaguing
To improve immediate local training outcomes, the committee considers
that overall funding for the TAFE and VET sectors must be increased, as this is
the most expedient and effective way of addressing gaps in local training in
the specific sectors experiencing skills shortages. Labor has already announced
that at least two thirds of government funding will be guaranteed to TAFE.
Given that under the current government the SAF on its own is failing to
provide sufficient funding for the workforce development effort, the committee
believes that the government should provide guaranteed additional Commonwealth
funding to immediately improve outcomes for vocational education and skills
The committee recommends that the Australian Government commit to
increasing overall funding levels for TAFE and vocational education and support
a comprehensive and thorough commission of inquiry into Australia's post‑secondary
The committee is also of the view that more can be done to encourage
student uptake of courses relating to industries experiencing skills shortages,
and that the Australian Government has a role to play in assisting in this
The committee recommends that the Australian Government consider ways in
which to encourage better information sharing between industry, vocational
education and training providers, and potential students in order to encourage
student uptake and local employment in industries experiencing skills
In order to fulfil the stated purpose of the temporary skilled visa
system, visa positions should be restricted to jobs where there is a genuine
skills shortage in a particular area. Concurrently, clear and targeted
mechanisms are needed to train local workers in these areas to address these
There are not sufficient accountability arrangements in place to ensure
that local workers are trained up in areas of skills shortage. The committee
heard that it is difficult for the Commonwealth to maintain oversight of
whether the states and territories are being responsible in balancing the need
to bring in a temporary migrant workforce, with the need to actually address
their long-term skills needs through training initiatives.
As such, the committee considers that there is a clear need to increase
access to information on how states and territories prioritise training
initiatives. This should include better communication and transparency between
the states, vocational education providers, and the Commonwealth. The proposed
independent authority in skilled migration matters outlined in Chapter 3 (see
Recommendation 7 in that chapter) would have a role to play in ensuring that
regional skilled migration needs are being matched with appropriate training
The issue of accountability for the training of workers in areas of
skills shortages is especially pertinent now that the National Partnership
Agreement on the Skilling Australians Fund has entered the implementation phase.
There must be public accountability about how funds delivered through the
Agreement are genuinely achieving the outcome of addressing skills shortages in
the Australian labour market.
The committee recommends that the Department of Education and Training be
required to present a report to Parliament bi-annually on the progress of the National
Partnership Agreement on the Skilling Australians Fund and the extent to which
it is achieving the outcome of addressing skills shortages in the Australian
The committee notes employer concerns over declines in training taking
place in enterprises. The committee also notes the absence of any national data
source that describes the investment that employers make in vocational education
and training at the workplace level.
The committee recommends that the Australian Government work with the
Australian Bureau of Statistics and the National Centre for Vocational
Education and Research to investigate and establish a research instrument to
enable analysis of employer investment in the development and training of their
Navigation: Previous Page | Contents | Next Page