Subject:  (The impacts of the SA Labor Government’s WorkReady training scheme on students, employers and jobs)


MATTHEW ABRAHAM: Senator Simon Birmingham is a South Australian Senator, he is Assistant Minister for Education and Training and actually controls quite a lot of money that is spent on vocational and other training skills in South Australia for the private sector, or to encourage competition between TAFE and the private sector. Senator Simon Birmingham, welcome to the program.

SIMON BIRMINGHAM: Good morning, Matthew, David and Listeners.

MATTHEW ABRAHAM: we understand that the Minister Gail Gago has replied to your letter. You sent her a ‘please explain’ and you’ve warned that the $65 million in cash that the Federal Government uses to encourage private training will be throttled off if the State Government doesn’t relent. What do you think of her letter?

SIMON BIRMINGHAM: Well, in response to concerns from all manner of industry and employer groups, as well as the social services sector, I wrote to Gail Gago last week asking her to explain how it is that the Government’s new WorkReady policy is in keeping with the agreement they signed on to with the Gillard Labor government in 2012, to give more choice to employers and students. And Gail Gago has replied. I have to say I’m somewhat underwhelmed by the reply. The heart of her argument seems to be we’ll have it all fixed by 2019. But the truth is that the agreement they signed with the Gillard government was an agreement that runs from 2012 to 2017. So the idea that it will be fixed by 2019 is woefully inadequate. The reality is that the theory behind this agreement is that the operation between the market and the choice for students and employers is meant to be better in 2016 than it was in 2015 or 2014, whereas the WorkReady model is taking it backwards and removing a lot of that choice.

DAVID BEVAN: So what’s worrying you here? Is it an ideological thing that you just think there should be contestability cos that’s a good thing? Or are you worried about businesses going bust because they built businesses around a certain level of government subsidy? Or are you worried about people losing their jobs? Or are you worried about kids who are doing this training and it disappearing halfway through their SACE? Which bit worries you?

SIMON BIRMINGHAM: There are two key concerns that I have. Firstly what we want overall from the training market is that students and employers are able to access the most relevant training at the most competitive prices that gives the skills to employees or students that employers are looking for to deliver in their workplace. So we need to make sure that it is as job-relevant as possible and we have people like the Civil Construction Industry, the Royal District Nurses, the Master Builders, the social welfare sector all providing very job relevant training. But the second concern is absolutely that the Labor Government in SA has now set up a boom-bust model; they encouraged all of these guys to come in to provide these training opportunities in recent years on the back of government incentives. Now they’re withdrawing all of those incentives but claiming we want you back in the market by 2019 … most of these guys will go broke before 2019

MATTHEW ABRAHAM: Gail Gago is saying it was made quite clear that this was one-off funding

SIMON BIRMINGHAM: That’s just not true in terms of the [unclear] changed approach to the delivery of training. Yes there was a surge in relation to the number of training places being provided to an extent, although that was really at the Government’s choice. What the national agreement is meant to be delivering is an entitlement to people to be able to access their choice of Certificate 3 level training across a variety of fields. The Government  has to determined just how many places they subsidise and that’s up to them. But it is also meant to be providing that choice of provider of training and the Government had gone a long way down the pathway of giving people choice of provider. In fact back in 2012 when the agreement was signed, more than 70% of training funding in South Australia was contestable; there was the opportunity for private providers to access that funding. Now we’re talking about a situation where in 2015/’16 90% of places will be guaranteed to the government-owned provider. This is a very dramatic turnaround

DAVID BEVAN: So is the SA Government just using this policy to prop up TAFE?

SIMON BIRMINGHAM: That would appear to be the case, David, and TAFE does a great job in many instances, and in a fully contestable environment if TAFE were to win all of the work that would be fine. I’m not fussed as to whether it’s a government-owned provider or a private provider, what I want to see is that employers and students have choice. And it would appear in the last few years the Government has not undertaken the reforms to the cost structure of TAFE that were necessary to give it a sound basis to compete. So instead they’re now saying they’ll guarantee 90% of places to TAFE which is removing that choice from employers and students and stripping the ability of those private providers … to be able to win those places in future

MATTHEW ABRAHAM: If you find you’re unhappy with the response and you will withhold that $65 million, are you able then to pay that directly to private providers? Is that within your discretion?

SIMON BIRMINGHAM: It’s not beyond the realms of possibility … I really do want to see every dollar that can go into SA spent and invested wisely in South Australia. And I want to see this $65 million invested and spent in SA. I would rather do it through the established protocols under the national partnership agreement. So my hope is that Gail Gago and Jay Weatherill will reconsider this appalling decision. If they don’t they I’m open to sit down with industry and others and see if there are alternative approaches that could see the money come to SA in a way that supports training, that is of value, that helps get young people and mature age workers into jobs

DAVID BEVAN: But … if you follow that option and … you’re just saying it’s an option, we are considering it, but if you do that you’ll have to get your skates on … these people are saying they’re going to start laying off their employees within a month

SIMON BIRMINGHAM: This is a crisis situation. I sat down on Friday with around 50 different training providers and employer and industry representatives, social services representatives, at the Royal District Nursing Society who are one of the entities who are losing their subsidised training places from the State Government, and yes they’re desperate for answers quickly. The best way to get answers quickly is for the State Government to reconsider its position because they already have the models and mechanisms in place to be able to deliver this funding in a sensible way

MATTHEW ABRAHAM: Well they might do a backflip today …

SIMON BIRMINGHAM: We can but hope. I did see the Premier yesterday suggesting there might have to be some refinements of the policy. I hope that it’s a significant refinement that puts common sense back into it and choice for employers and students. 

MATTHEW ABRAHAM: Senator Simon Birmingham, South Australian Senator and Assistant Minister for Education and Training; thank you for talking to 891 breakfast.