Federal Budget Insights - Boosting Apprenticeship Commencements

 

Apprenticeships and traineeships to be subsidised under new Federal Budget plan

Posted on 25/09/20 in

Big Boost for Apprenticeships

The Federal Government announced over the weekend a new $1.2 billion Boosting Apprenticeship Commencements (BAC) plan to help pay the wages of new apprentices and trainees.
 
The Prime Minister Scott Morrison, Senator Michaelia Cash and Steve Irons MP confirmed it will roll out the BAC wage subsidy scheme to support Australian businesses in employing new apprentices and trainees as part of the COVID-19 recovery plan.
 
Under the new measure, employers will be eligible for 50 per cent of the wages for a new or recommencing apprentice or trainee for the period up to 30 September 2021, up to $7,000 per quarter.
 
Minister for Employment, Skills, Small and Family Business, Senator the Hon Michaelia Cash said the measure builds on the existing $2.8 billion Supporting Apprentices and Trainees wage subsidy that is helping employers to retain their apprentices and trainees.
 
“The Australian Government has already invested significantly to ensure that apprentices are retained where possible and supported to re-engage if they lose their job,” Minister Cash said
 
The announcement will reassure school leavers in finding employment. It will create opportunities for mature workers to retrain and support employers keen to hire trainees and apprentices but are struggling to afford the cost during the coronavirus pandemic.
 
The Prime Minister Scott Morrison praised the scheme in a statement, saying “this new wage subsidy gives businesses certainty to hire and provides a career path to aspiring, young tradies”. Apprenticeships and traineeships are an important pathway to get young people into jobs and to ensure there is a skills pipeline to meet the future needs of employers.
 
What we know so far:
 
Any business or Group Training Organisation (GTO) that engages an Australian Apprentice on or after 5th October 2020 may be eligible for a subsidy of up to 50% of gross wages up to 30 September 2021. 

Must be one of the first 100,000 apprentices or trainees who commences or recommences on or after 5th October 2020 and registers successfully for the subsidy.
 
The subsidy is capped at a maximum of $7000 per quarter, regardless of geographic location, occupation, industry or business size.
 
The scheme is on offer to all industries across the country – from manufacturing, construction, arts, mining to IT and business administration.
 
The subsidy will be paid directly to the employer when they sign up an apprentice or trainee with a commencement or recommencement date on or after 5th October 2020.
 
BAC is not available for any apprentice or trainee receiving other wage subsidies, such as Supporting Apprentices and Trainees (SAT) or JobKeeper.
 
Apprenticeship Support Australia (ASA) welcomes the announcement of the new subsidy program and is pleased by the Government’s ongoing support of our apprentices and trainees. The announcement is also a major win for businesses as the subsidy has been extended to businesses of any size and in any industry.
 
Managing Director of Apprenticeship Support Australia, Darren Cocks, said “the announcement comes at the right time; with companies continuing to feel the impact of the pandemic, this subsidy will provide businesses the encouragement and support to take on more apprentices or trainees. Given apprenticeships require a long-term commitment, BAC paves the way for developing skills for tomorrow and securing a strong road to economic recovery and Australia’s future."
 
Rod Marchant-Smith, business owner of Peninsula Air, who currently employs three apprentices through Apprenticeship Support Australia is thrilled with the news. He commented, “as a small business owner, the support received has definitely enabled us to weather the storm to date. The new incentives might allow us to hire even more apprentices this year than we had planned”.

The new subsidy will give businesses the certainty they need to invest in new staff during these extremely difficult economic times and help reduce the high unemployment levels brought about by COVID-19.

Further information about the subsidy is available here.

If you would like to talk to a member of our client services team please call us on 1300 363 831 or send us an email here.


 

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