Abbott Plans to Ease the Financial Stress for Apprenticeships Australia
Apprenticeships Australia are making headlines today with Tony Abbott’s new campaign to boost skilled workers by providing up to $20,000 in a HECS-style interest free loans to apprentices, to help with upfront costs and reduce high drop out rates.
The coalitions newest campaign – this apprenticeships Australia loan scheme is proving a powerful play; designed to assist with the costs of tools and equipment, acknowledging the need for financial aid to assist apprentices to complete training.
Abbott`s Trade Support Loan scheme will target Australian apprenticeships where national skill shortages are apparent and will provide access to up to $20,000 over a four year period to ease financial pressure that so often causes young apprentices to drop out of apprenticeship.
Trades with a strong skills shortage and with a 50% drop out rate are targeted
- Diesel mechanics
- Electricians and
Australian Apprentices will have to pay back the loan once they have completed their apprenticeship however this is only when they earn over a set threshold, similar to the HECS loans for university students who have to begin repayments once their salary hits $49,000.
However under Abbott`s Trade Support Loans, apprentices will be further incentivised with an fantastic 20% discount on their total loan, if they complete their training in full.
“I want young Australians to be equipped with the skills they need to secure their long term job prospects in a dynamic economy,”
“The Apprenticeships Australia scheme has identified the obvious hardship people undertaking Australian apprenticeships present financially, and will help up skill our country so that jobs will be filled by our highly skilled workforce and ensure our people have a long and fruitful career ” Mr Abbott told The Sunday Telegraph.
Australia urgently needs more apprentices.
The policy document notably points out that “Australia urgently needs more apprentices. We need more young people to take up a trade career to ensure future growth and jobs.”
With Australian apprenticeships dropout rates ever-increasing, sitting currently at 48%, the coalition has certainly identified a strong area of concern, and this option does provide addressing.
Funding Available for Apprenticeships Australia Under Abbott`s Trade Support Loan Scheme
- 1st Year apprentices would receive $8000 paid in quarterly instalments of $2000.
- 2nd Year apprentices would get 4 X $1500 – to a maximum of $6000.
- 3rd Year apprentices could access a $4000 top up
- 4th year apprentices could secure $2000 annually.
(Payments would immediately stop if apprentices dropped out of training.)
Abbott`s Trade Support Loans will be offered to apprentices undertaking a Certificate III or IV qualification identified on the National Skills Needs List which offers up to 70 different trades.
According to Group Training Australia, one of Australia’s largest employer network of apprentices and trainees has explained that this loans plan could be key to lowering our substantial drop out rates of apprenticeships Australia.
One thing is for certain, a policy like this helps the back pockets of up-and-coming tradies, assisting with up-front needs and allows apprentices to repay down the track, once qualified when it’s financially possible. Tony Abbott claims that providing financial loans for apprenticeships in Australia has the potential to lower drop out rates and help with our skills shortage and aims to create a highly skilled Australian workforce for the future.
What do you think? Do you like the proposal or disagree?
Reference: Tony Abbott Announces $20K Funding Proposal for Apprenticeships Australia