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This Budget won’t help productivity, skills gap, or made-in-Australia future

BUDGET REACTION – Australian CEO and author, Jarrod McGrath has slammed the 2024 Budget for doing “nothing to help fix our stifling productivity, growing skills gap, or ensure a future made in Australia”.

Mr McGrath, who founded and heads up Smart WFM – a global workforce management (WFM) and human capital management (HCM) consultancy – said successive governments had made an already complex industrial relations, union, and payment system more complicated, “to the point that it’s become too hard to correctly pay people”. 

He said political leaders had avoided investing in, or even discussing, this issue as “it’s not easy to fix and frankly, worryingly, most of them don’t understand it”.

“This Budget will do nothing to help fix our stifling productivity, growing skills gap, or ensure a future made in Australia,” Mr McGrath said. 

“The worker carries this country. My Dad’s Dad was a boiler maker, jumping into fire boxes, often while still trying to keep steam trains running.

“Dad was a motor mechanic. My friends were mostly tradies. From these roots, this country grew along with a complex industrial relations (IR), union, and payment system that successive governments have made more complicated,” he said.

“Today we live and work in tech-driven knowledge economy underpinned by our history and any Budget and government activity must acknowledge this. If we are truly going to have a future made in Australia, we need to simplify the complexities that make it so difficult to correctly pay people.

“If the government really wants Australia to lead the world on green energy, it has to make it easier for budding green energy entrepreneurs to get the right people in place,” Mr McGrath said.

“We need to seriously invest in technology and simplify the complex systems that inhibit its use to drive productivity and efficiency.

“Political leaders have avoided this for years because it’s not easy to fix and frankly, worryingly, most of them don’t understand it.”

www.smartwfm.com

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What does Federal Budget 2024 mean for development, education and employment across industry sectors and initiatives?

BUDGET REACTION -- from Wendy Perry of Workforce Blueprint >>

YOU WATCH THE TREASURER Jim Chalmers MP on the ABC deliver his budget speech, scan the relevant documents (budget paper #2 is the key), and draw some conclusions based upon the language, slogans, what has led up to today with various announcements, and what you know about the longer-term potential approaches being considered.

Jim and Treasury friends believe that the unemployment rate will go up to around 4.5% (unsure of the timeframe) and I [picture in this article is from Budget 2024 afternoon] believe that a % with a 3 in front of it is too low for our economy and employers to function – I’d suggest an average rate of around 4% can work noting that this varies wildly across the country.

Read this blog I wrote in February 2022 – What will Unemployment Rates With a 3 in Front of it do for Labour and Skills Shortages in Australia?

Take what makes sense for you from this summary focusing on economic development, education, employment services and entrepreneurships, higher education, industry and regional development, social enterprises, startups and scaleups, VET and working with specific cohorts. 

There is more cross correlation between portfolios so you might say that makes it more integrated, or others might think it can hide where funds are going from and to.  For each area I’ve chosen the items that might make a difference to you, your business/organisation and your work.

Here we go starting with – Education (schools), where there is support for student wellbeing and piloting new approaches to managing teachers workload, promotion of defence industry career paths, consent and respectful education, on country learning and support packages for First Nations students.

Skills (TAFE) has more fee free places, turbocharging (this is the term used by the Australian Government) teacher, trainer, and assessor workforce (sounds very familiar), TAFE Centres of Excellence supported by a National Network.  TAFE Technology Fund for areas such as electric vehicles, green energy, cyber security, and the pipeline of skills for building and construction with pre-apprenticeships (another program from the past).

Higher education (HE) gets a fair focus with wiping of student debt/loans (reasons range from people being able to borrow for property to chasing some of these debts is a waste of time and money), capped places for international students linked to providers having accommodation and housing for them, addressing gender-based violence in HE, and payments for pracs in health and education.

A goal of 80% of the Australian working age population having a tertiary qualification by 2050.  And funding to progress harmonisation, which I think means one regulator for the tertiary sector in Australia – higher education and VET combined by around 2028; also linked to a National Student Ombudsman for the sector.

There is a new $100 million Outcomes Fund could be interesting supporting place-based strategies in skills and employment, without much detail, but with an equity and gender lens.  There’s $54 million for two new paid work placement programs (Real Jobs, Real Wages and Work Foundations) for job seekers with barriers, and Regional Workforce Transition Plans but lacking information on the purpose.

Not sure if I’m reading it right but looks like incentives for many Australian Apprenticeships disappear from particular industry sectors and job roles, focusing on areas with acute – significant skills – and labour shortages.

Disability Employment Services reform and replacing, current employment which seems to wrap up a number of items, and a kind of vague-ish employment and workplace relations reprioritisation.

Language of ‘Getting the NDIS back on track’ where the spend on fraud detection is similar to the savings – I’ll leave others in the sector to comment on how that might go; and I’m not going to comment on migration either.

Access and equity, support for First Nations people, women, people with disabilities and people from Culturally and Linguistically Diverse (CALD) background have various measures across multiple portfolios.

Opportunities are in:

  • Net Zero, Clean Energy, Hydrogen
  • Housing, Building and Construction (domestic and not so much large infrastructure projects bar things we already know about)
  • Defence, STEM industries, shipbuilding, nuclear-powered submarines
  • Early Childhood Education and Care sectors, Health
  • Promoting TAFE and VET Pathways (yes that old chestnut!) to drive demand for VET but the products will need to be much better and more future job focused
  • Australia-France Roadmap (need to brush up on my French)
  • Water and Snow Safety Program
  • support measures for Women ($55.6 million investment in the “Building Women’s Careers” program)
  • Future Made in Australia – Workforce and Trade Partnerships for Renewable Energy Superpower Industries which seems like some reallocation from the National Reconstruction Fund but that is just my take on it.

Nothing really for small business, so perhaps lobbying here needs to be stepped up with evidence and examples, as there are industry sectors like hospitality doing it really tough in certain places.

On Employment, Jobs and Skills Australia and the National Careers Institute are okay with the progression of the five-year National Skills Agreement, and a few new items such as First Nations Prison to Employment Program (voluntary), National Indigenous Employment and Training Alliance to operate as a First Nations employment services peak body, Energy Industry Jobs Plan, and the Remote Jobs and Economic Development Program.

A line gets put through and savings for Employment come from:

  • • $47.3 million over five years from 2023–24 (and $11.1 million per year ongoing) by ceasing the Harvest Trail Services and Harvest Trail Information Service programs from 30 June 2024.
  • • $6.1 million over five years from 2023–24 (and $1.2 million per year ongoing) by ceasing the International Skills Training Courses program from 1 April 2024.
  • • $4.7 million in 2023–24 by reducing the number of grants issued in the second stage of the Automatic Mutual Recognition of Occupational Registrations scheme under the Business Research and Innovation Initiative.
  • • $58.8 million over five years from 2023–24 (and $14.0 million per year ongoing) from ceasing the Workforce Specialists initiative.
  • • $53.9 million over four years from 2024–25 (and $17.7 million per year ongoing) from reducing credits to the Workforce Australia – Employment Fund by $100 for each new participant to Workforce Australia Provider Services.
  • • $27.0 million over five years from 2023–24 (and $6.6 million per year ongoing) from reducing credits to the Workforce Australia – Employment Fund by $50 for each new participant to Workforce Australia Online.

Well that is a first take, not massively exciting, maybe the last budget before a federal election? I’d put a bet on to say ‘yes’ if I was pushed, but let’s wait and see.

This email address is being protected from spambots. You need JavaScript enabled to view it.

www.workforceblueprint.com.au

 

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Advance Cairns says Budget offered ‘slim pickings’ for the region

BUDGET REACTION – Advance Cairns has reported that while the 2024-2025 Federal Budget was big on national initiatives, it was short on specific commitments to Cairns and Far North Queensland.

Advance Cairns, the leading independent economic development and advocacy organisation in Far North Queensland, said while the Budget introduced welcome measures to address cost-of-living pressures and skills shortages in regional Australia, it failed to deliver on key projects such as the Cairns Water Security project.

“We are hard pressed to find any demonstrable new investments in what is Northern Australia’s most populated region, which is deeply disappointing,” Advance Cairns chair, Nick Trompf said. 

“We will continue to push for additional funds to support Cairns Water Security Project Stage 1, which is a vital piece of infrastructure. Without these additional funds to meet the rising construction and materials costs, this project will in fact add to further cost-of-living pressures for all Cairns ratepayers.

“We will continue to support council’s efforts to generate understanding of the cost levers which have resulted in widespread infrastructure build hikes across the nation. Cairns Regional Council is certainly not unique across Australia in facing major construction cost rises.

“We are hopeful that the door remains open to increased funding of this important initiative and we will continue to push for this critical investment,” Mr Trompf said.

The Budget also did not address a range of other initiatives in the Advance Cairns submission including:

  • Roads projects of $106m for Savannah Way, $30m for the Kennedy Developmental Road and $20m for a study into alternative routes to the northern Tablelands;
  • Establishing an ‘Office of the Pacific’ in Cairns;
  • $500,000 per year in recurrent funding for five years for COUCH Wellness Centre in Cairns;
  • and $12m for further upgrades to the city’s three shipyards.

Mr Trompf said the Budget included $14-$18bn over the next 10 years for defence infrastructure to create what is described as a ’logistically connected and resilient set of bases, ports and barracks across Australia’s north’.

“This might have implications in key assets such as HMAS Cairns, the Cairns Marine Precinct and the Scherger Air Force base, near Weipa,” Mr Trompf said.

CEO of Advance Cairns Jacinta Reddan said while the lack of direct investment in the region “was incredibly disappointing” there were some areas for optimism. 

She said Advance Cairns welcomed the investment in the Future Made in Australia initiative, recognising its potential to stimulate the region’s economy and result in jobs growth.

“We are encouraged by the opportunities, particularly in onshoring advanced manufacturing in the clean energy and renewables sector,” Ms Reddan said.

“We are also keen to better understand how the commitment of about $41 million over two years to fast-track Nature Positive reforms will benefit Far North Queensland. This initiative holds promise for our region, as it aims to attract private investment in nature regeneration and restoration – assets our region has in abundance.

“We also welcome critically needed reforms to the EPBC (Environment Protection and Biodiversity Conservation Act 1999) and look forward to learning more about how this can improve the current opaque approvals process,” she said.

In addition, Advance Cairns welcomed the Budget’s support for apprenticeships, particularly those in regional Australia, as well as initiatives to grow the construction workforce and boost housing supply.

“We are particularly pleased to see the extension of the Approved Destination Status regime for visitors from China, building a strong foundation for the return of the China group travel market,” Ms Reddan said.

“As always with Budgets, the devil is in the detail and we look forward to drilling down into more information about the specific implications for our region,” she said.

www.advancecairns.com

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Budget apprentice and trainee incentives welcomed by ITECA

BUDGET REACTION – The 2024 Federal Budget’s investment to support the employment of more apprentices and trainees has been welcomed by the Independent Tertiary Education Council Australia (ITECA), the peak body representing independent skills training, higher education, and international education providers.

The Australian Government is providing an additional $265.1 million over four years in financial support for apprentices and their employers.  Under the Australian Apprenticeships Incentive System, apprentices and employers in priority occupations will receive an extra $2,000 and $1,000 respectively.

“This additional funding is welcome and will help aspiring apprentices and trainees plus their potential employers,” ITECA chief executive, Troy Williams said. 

Under the revised system, from July 1, 2024, employers taking on apprentices training in priority occupations will be eligible to receive an additional $1,000 – $5,000 in total – in incentive payments, to help subsidise costs associated with employing an apprentice. 

Further, apprentices undertaking training in priority occupations will be eligible to receive an additional $2,000 – $5,000 in total – in incentive payments, to assist with cost-of-living pressures and support them to finish their training.

“From construction, mining, health and hospitality the Australian Government’s investment will help more people not just into a job, but into a career,” Mr Williams said.

Apprentice payments will be restructured to be frontloaded, with apprentices receiving $3,500 in the first year and $1,500 in the second year. This will provide more assistance to apprentices when they need it most.

Employers can receive up to $5,000 in the first year. Payments will be paid over two instalments, with $2,000 at six months and $3,000 at 12 months.

“The approach of the Australian Government looks to support apprentices and trainees throughout their studies has merit,” Mr Williams said.

Some employers have queried whether the additional amount will make much of a difference when it comes to apprentice and trainee recruitment and retention. 

ITECA noted the Australian Government had a report –  the Strategic Review of the Australian Apprenticeship Incentive System –  underway that would investigate the support available to help more people start and complete apprenticeships and traineeships.

“ITECA looks forwards to ensuring that our members’ views are taken into account as this review makes its recommendations to the Australian Government,” Mr Williams said.

Independent Registered Training Organisations support 50.9 percent of the 365,420 apprentices and trainees in training as at September 2023 accord to the National Centre for Vocational Education Research (NCVER).

www.iteca.edu.au

 

Fast facts

From July 1, 2024, employers taking on apprentices training in priority occupations will be eligible to receive an additional $1,000 ($5,000 in total) in incentive payments, to help subsidise costs associated with employing an apprentice.

From July 1, apprentices undertaking training in priority occupations will be eligible to receive an additional $2,000 ($5,000 in total) in incentive payments, to assist with cost-of-living pressures and support them to finish their training.

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Critical minerals support welcome but government policies must deliver for all resources - QRC

BUDGET REACTION - THE Queensland Resources Council (QRC) has welcomed initiatives in the Federal Budget that promote exploration and investment in critical minerals projects but says policies must encourage and attract investment right across the resources sector. 

QRC chief executive officer, Janette Hewson, said a number of the Budget initiatives would support the emerging critical minerals sector in Queensland. 

“The Critical Minerals Production Tax Incentive, funding to progress common user facilities and $566 million to Geoscience Australia to develop new data are all important announcements that will benefit our critical minerals industry,” Ms Hewson said. 

“As announced last month, the Budget also confirmed a $400 million loan to Gladstone-based Alpha HPA to deliver Australia’s first high-purity alumina processing facility in Queensland.”   

Ms Hewson said the resources sector remains the shining light for the national economy as Australia faces economic headwinds at home and internationally and all levels of government need to focus on policies that attract investment in all commodities. 

“The resources sector is proud of its significant contribution to Australia’s economic security through taxes, royalties and jobs, and the QRC urges governments to focus on policies that encourage the essential private investment required to develop projects that benefit all Australians,” Ms Hewson said. 

“In Queensland, coal, gas and minerals producers contributed a record $116.7 billion to the state’s economy in the 2022/23 financial year. 

“This contribution includes nearly $33 billion spent by resources companies purchasing goods and services from local businesses, particularly in regional Queensland. 

“The Queensland resources sector is also helping with cost-of-living pressures for more than 530 thousand Queenslanders whose jobs are supported by the resources sector, including 61,000 directly employed in an industry with the highest average income in Australia.

“This budget underlines the importance of keeping the resources sector strong,” Ms Hewson said. 

“It is more important than ever that there is policy consistency and stability at both the State and Federal level to give investors the confidence to go ahead with new projects and jobs. 

“Communities across Queensland and Australia rely on a strong resources sector.” 

www.qrc.org.au

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CAs see 'important steps for a sustainable future' taken in Federal Budget 

BUDGET REACTION - AUSTRALIAN peak accounting body, Chartered Accountants Australia and New Zealand (CA ANZ) regards several initiatives announced as part of the latest Federal Budget as “important steps in providing the sector the resourcing and focus it needs as we transition to a sustainable future”. 

“It’s pleasing to see in the detail of the Budget, the Australian Accounting Standards Board (AASB) and Auditing and Assurance Standards Board (AUASB) are finally getting appropriate resourcing to support the development of standards for climate-related disclosures and wider sustainability reporting,” CA ANZ chief executive Ainslie van Onselen said.

“This has been something our members, and the wider profession have been calling for although we await the finer details of where the additional people will be employed.

“There is also an additional $10 million over four years for ASIC to investigate and take enforcement action against market participants engaging in greenwashing and other sustainability-related financial misconduct.  

“This is of significant interest to the profession and something we have identified as an emerging issue the government needed to address.”

New beneficial ownership transparency requirements 

“CA ANZ also notes $41.7m over four years to the Treasury, ASIC and the Attorney-General’s Department to regulate and support new beneficial ownership transparency requirements for Australian companies and other entities,” Ms van Onselen said. 

“CA ANZ were key participants in industry wide consultation on this very issue in late 2022 and look forward to seeing more detail on these requirements and engaging with government as they are developed.

“We also note funding for the Australian Small Business and Family Enterprise Ombudsman to support small business to navigate business-to-business disputes through alternative dispute resolution.

“Last year, the government undertook a review of the Payment Times Reporting Act, and the Budget includes $25m over four years for the Payment Times Reporting Regulator to implement the required reforms, increasing the Regulator’s resourcing and upgrade their technology,” Ms van Onselen said. 

“We recently provided feedback on legislative amendments arising from the review and specifically highlighted the need for Government to increase awareness of the regime with small business.”

Increased ASIC staffing 

“Following the release of the Budget, we commended the government on its strengthening of ASIC (Australian Securities and Investments Commission) with a significant increase in staffing, although we are keen to see the detail of where those people will be employed,” Ms van Onselen said. 

“At several appearances in front of parliamentary inquiries over the past 12 months, I’ve regularly stressed the importance of having a strong and well-funded independent regulator for the profession, outside our remit as a membership body.

“Twenty years on from the government announcing the shift from self-regulation to government-regulation of audit, its concerning that gaps and uncertainties remain over jurisdiction, powers and resourcing.

“As we said in our recently released Going Further roadmap, it’s vital that additional funding is focused sufficiently on audit and financial reporting regulation and standards, to provide the coverage needed for government to meet the regulatory mandate it has taken on with respect to these critical aspects of Australia’s capital markets and economy,” Ms van Onselen said. 

“In addition to increased funding, it’s also essential to provide clearer regulatory powers for ASIC on quality management at audit firms and relevant governance requirements, as the audit regulator and standards setters have called for in recent submissions to parliament. 

“We must be mindful however, that an increase in funding for ASIC will likely be paid for via industry levies, business and professionals,” Ms van Onselen said. 

www.charteredaccountantsanz.com

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Just Cuts welcomes new Apprenticeship Incentive System, calls for states to follow

BUDGET REACTION – Australia’s largest employer of hairdressers, Just Cuts franchising, has welcomed the Federal Government’s Budget announcement to invest $265.1 million over four years to provide additional targeted support under the Australian Apprenticeships Incentive System.

Just Cuts leadership welcomed the key aspects of the support program, but wished it was more extensive.

Under the changes, apprentices training in priority areas will be eligible for an additional $2,000 ($5,000 in total) to assist them to undertake and complete their training.

Furthermore. employers taking on apprentices in priority areas will be eligible for an additional $1,000 ($5,000 in total) to help subsidise costs associated with employing an apprentice.

Just Cuts employs more than 3,500 stylists in over 190 salons across metropolitan, regional and rural Australia. At present 16 apprentices are training in New South Wales, Queensland and Northern Territory salons. 

With hairdressing a priority skills occupation, Just Cuts CEO Amber Manning said the network of family-owned salons across Australia wished they could make more use of the upcoming support.

“This is great news,” Ms Manning said. “But our salon owners just wish we could actually make more use of it.

“In NSW, for example, we are limited to a maximum of 15 apprentices being enrolled in an apprenticeship with Just Cuts at the one time, which is a missed opportunity as we have 78 Just Cuts salons in NSW.

“We’ve invested our own resources in developing our own approved apprenticeship programs because we recognise the need and the demand for hairdressers, and we have owners ready to support more apprentices to help grow the next generation of hairdressers.

“We need state governments to support our salons in closing the skills gap for the industry.”

Just Cuts is an Australian hairdressing franchise that bridges the gap between a barber and a high end hair salon. With salons in every state of Australia, on both the North and South islands in New Zealand and in the United Kingdom, Just Cuts is the largest hairdressing company in the Southern Hemisphere, performing more than 100,000 style cuts per week across three countries. 

www.justcuts.com.au

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