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Senator Hon. Simon Birmingham address to Master Builders Industry Dinner


Address to Master Builders Australia Industry Dinner
Hosted by Master Builders South Australia, Friday 28 August 2015, Adelaide Oval.

SIMON BIRMINGHAM: Thanks very much for that welcome, and ladies and gentlemen it’s wonderful to be with you all here at the Adelaide Oval, the magnificent Adelaide Oval. It is a great venue indeed to have a gathering of Master Builders, because it is a testament to the fact that you have taken, as an industry, with your skills, with your capabilities, with your sense of innovation, you have taken the most beautiful cricket ground in the world and turned it into an even more beautiful cricket and football stadium. And it’s a real pleasure to be here at this place, where I trust the Adelaide Crows will cause another upset against another West Australian team, just as a certain other South Australian team led against a certain other West Australian team last weekend.

And I begin by acknowledging a few people here, to of course the leaders of the Master Builders Association – to Trevor Evans, the President; Dan Perkins, the Deputy President who for his sins is a West Coast fan, and I’m happy to wish him well in the finals, but not so much for this weekend. As we said at our table before, when it comes to the finals, a West Coast victory at least means a happy Julie Bishop, and a happy Julie Bishop is good news for all of us.

To Wilhelm Harnisch, the CEO; to Tim Mead, the chair of the National Training Advisory Committee; to Richard Bryant, the South Australian President.

When I’m here talking about Master Builders and instruction, and I paid a particular welcome tonight to Jock Merrigan from Urban Habitats. I welcome Jock, I haven’t seen you here tonight Jock, there you are. I welcome Jock. Curiously, for the rest of the people in the room, but Jock’s got a minor renovation project on his list of works at present, it’s very dear to my heart. And even dearer to my wife’s heart.

So I trust that Jock does a great job – I hate to single you out tonight Jock.

To my colleagues, Senator Sean Edwards, a great friend and warrior in the Australian Senate, and if only we had six more warriors in the Australian Senate like Sean Edwards, the country’s government would run much more smoothly that it does relying on some of those interesting individuals who occupy the cross benches. To my wonderful friend in the State Parliament Vickie Chapman, the Deputy Liberal Leader; Steven Griffiths and David Pisoni, shadow ministers; to John Darley – to all the friends in the Labor Party, wherever you are tonight, hello, you’re not in this room, but …but seriously, it is very good to be able to be with you all.

As you heard [indistinct] today from North Queensland had the honour and the pleasure over the last few days of being in the Torres Strait and the Northern Peninsula area of Cape York with the Prime Minister, and it is really an opportunity to see Tony Abbott at his best, at his most committed and his most passionate, when he’s there engaging with those Indigenous communities – pursuing of course the opportunities to lift people out of poverty and to give those remote areas of Australia, and the people who have been here for tens of thousands of years the opportunities to lead the types of lifestyle that so many of us all take for granted.

It’s a long way of course from up there, and very early start today, but I’ve been well accustomed to early starts over the last couple of days, because when the Prime Minister takes a bunch of his ministers and a bunch of senior officials to the remote parts of Australia, it becomes a bit of a large logistical exercise. And so the Army have had to sleep in, not in the types of wonderful homes that you all build, but in tents the last few nights on camp beds.

But Tony being Tony doesn’t let that put him down, he makes sure that the Army has us all up at 5:15 each morning for a PT session. So I’m feeling not just enlivened to be with you all tonight, delighted to be back home in Adelaide where I won’t be sleeping in a tent, but also very pleased to know that I won’t have the drill sergeant tomorrow morning talking to me at 5:15.

But seriously, as a government, we have fought very hard to make sure our agenda is singularly focused around the competitiveness of Australia, around how as a country we can best create the opportunity for business growth, and invest through our economic opportunity for businesses to create more jobs for more Australians in the future. That’s why, in terms of competitiveness, we’ve done things like get rid of the carbon tax, reduce taxes to small businesses and micro-businesses, initiate measures that are about trying to reduce some of the cost pressures from government. Because that’s about trying to make Australian business more competitive. It’s why as a government we’re pursued as part of our overall competitiveness agenda, reduction in red tape and reduction in areas of government bureaucracy wherever possible.

It’s about trying to make an Australian business more competitive. It’s why we are investing and putting more focus on skills and vocational education and training, as we do through my portfolio, because we recognise that’s an important part of making Australian business as productive as possible, and by being as productive as possible, business can be as competitive as possible.

It’s why we have run the largest ever infrastructure projects in the country, and have got the biggest portfolio of spending on infrastructure. Because again, we know that building infrastructure doesn’t just contribute to economic stimulus now and while it’s being built; building effective infrastructure, effective investment, and in the right types of road, port, and airport assets lifts the national productivity.

And by lifting the national productivity we again become more competitive as a nation, and better able, in an increasingly global world, to create the types of jobs that sustain the type of prosperity as a country we want.

And that will continue to be a real primary focus of our Government. And we recognise that industries like yours, major employers like yours are critical to our success. Our efforts are not about creating jobs from government; our efforts are about trying to create the right environment for you to create jobs. As small, medium, and large businesses, as those who engage contractors, as those who stimulate opportunities for new businesses to grow throughout our economy.

My particular role of course in this space is nowadays to focus on education and training and particularly vocational education and training. When the Prime Minister appointed me to the ministry at the end of last year, it was the first dedicated ministry established for vocational education and training, skills and apprenticeships that Australia’s seen since the Howard Government.

My priority is to make sure that we give that focus to the reforms that are required to make our VET sector and to make TAFEs and private training organisations, enterprise based and industry based organisations, operate in a way that is as effective as possible to provide people with skills that, in the true sense of vocational education, equip them directly for jobs and employment in the future.

And when it’s done well, when it’s truly integrated with employers who pass on their knowledge and training, then we can have confidence that vocational training does lead to great job outcomes. Because if I look at apprenticeships, the iconic aspect in many ways of the vocational sector, we see that for those who successfully complete their apprenticeship, especially in a trade-based apprenticeship, 90 per cent of people secure employment at the end of that. That’s a figure that almost any other area of investment in training would die for. To see whether it’s university graduates, other sectors of training to have 90 per cent of those who complete actually securing employment in the immediate term after their conclusion.

The problem though is that apprenticeship completions have hovered around a 50 per cent mark for far too long.

So one of the big reforms we’ve undertaken as a government is establishing a new Australian Apprenticeships Support Network. It’s been backed up by a major investment in new IT infrastructure to support the national apprenticeship system so that no longer will we need to have those who need apprentices having rooms as large as this filled with boxes full of paper to tick off individually the competencies of somebody on the way through. We’re providing the IT infrastructure and then we’re able to divert the money that used to be spent on paperwork and bureaucracy into providing gateway services at the outset, it will help all of your businesses to make sure you’re getting the right person going into the right apprenticeship and the right business.

To make it as I like to say a happy marriage at the outset that we actually provided that upfront counselling service to ensure the apprentice is well matched to the trade and to the employer. But also investing more in mentoring to be available during the life of the apprenticeship so that once again if it’s going off the rails, either from the employer side or the apprentice side, there’s an independent source to be able to step in and to provide assistance in that regard. So the apprenticeship support network is really about trying to lift the completion rates.

We had some challenges in commencement rates as well, which I want to ensure we move on to addressing but first and foremost I want to see that the time and effort and money spent on starting people out on their apprenticeship actually gets more of them to conclusion of their apprenticeship through having the right support in the right locations around the country.

Commencements are also a challenge, more so in the non-trade apprenticeship space, the traineeship type space but in that area I acknowledge that since the previous government withdrew a number of subsidies and incentives, for the provision of apprenticeships and traineeships we’ve seen a marked decline in commencement numbers and that’s continued as a decline under our government, to a lesser extent that it has continued. Some of that is to do with economic circumstances in different parts of the country but it also is a reality that we need to have a look at what is causing those commencements to go down and in the coming days I’ll be making clear the types of processes we’re going to play out over the next couple of months so that we’re well placed with some recommendations to go into the next Budget cycle and have a look at how we can best and most effectively rebuild that apprenticeship space in terms of commencements supported by our existing initiatives to lift the rate of completions.

And it’s really important of course that we succeed in that, not just because it will help more young people, more mature age apprentices secure employment by completing those apprenticeships but because it’s backed up by the type of evidence in your Towards 2020 document and I want to congratulate MBA on its initiative on developing towards 2020. In outlining its passionate interest and engagement in skills and training activities and then identifying the scale of the challenge that lies ahead, the need for 300,000 additional skilled workers by 2020; the recognition that your industry has around concerning trends on the reduction of apprenticeship commencements. At the low levels of female participation and I’m very eager to make sure we work with MBA on whatever the model for apprenticeship reform are over coming months so that we can deliver a system that reverses this decline we’ve seen in commencement numbers.

I’m equally going to make sure that when it comes to the content of training, in apprenticeships and in all qualifications of vocational education sector that we have training that is as job relevant and industry relevant as possible which is why we’ve re-written the rules around how it is that qualifications will be developed in future.

Put in place a new framework led by a new industry, employer-led national committee that has of COAG and states as well as the Commonwealth Government and will then break down into a whole series of different industry sector committees led by employers, who will be the ones who determine what content, what skillsets, what competencies go into their qualifications in the future.

Because it’s my passionate belief that it’s employers who know best what skills they need in their employees, and that’s the view of our government that we want to put engaged employers and employer representatives at the head of the table making the decisions about when training packages should be reviewed, what qualifications should be in training packages, what competencies should be required in those qualifications. We are confident that our new structure for training packages will give sectors like yours a much clearer say and control over the content and qualifications, which should give all of you then much greater confidence then those who come out at the other end of training through the VET system actually have the types of skills you need for the jobs that are on offer in the future.

This is complemented by significant new investment from a Federal Government perspective in industry and employer-led training. Our Industry Skills Fund is a $664 million Federal Government investment, where we’re supporting employers to make applications for funding for the training they need to be able to grow their business. And it’s flexible; it means that you as builders could be seeking funding to help train people in marketing, or in ancillary or associated aspects of your work around interior design or other aspects, that will help you to diversify or grow your business interest by investing in the skills of some of your employees. And I again encourage all of you to think about how it is you could access those kinds of services and that type of government support to be able to grow your businesses in the future.

Overall, I have great faith and confidence in the structure of our vocational training system. Around three million Australians per annum undertake some form of vocational education and training. Only half of those do so with any level of government support. The other half is funded by their employers or out of their own pocket. And as those of you in this room know, there’s no greater vote of confidence in anything than when people are paying for it themselves. So it’s a great vote of confidence that around 1.5 million Australians invest in VET every year because they see direct value in it. But we need to make sure that’s continued, which is why we’re investing and lifting the quality, improving the job relevance, and ultimately having discussions about how the training market can work best.

Here in SA we have some real challenges on that front, and I acknowledge the leadership that the MBA has shown in relation to some of those problems and concerns about the changes to the training market in SA, which have seen a dramatic reduction by the South Australian Government in the opportunity for non-TAFE providers to provide training in the construction industry and building industry.

I’ll be meeting once again on Monday of next week with stakeholders who are concerned about South Australia’s approach to training, and I’ll continue to talk to the Weatherill Government, and urge them to recognise that employers and students deserve choice in the training provider they access. They deserve to have a market that is actually providing them with the highest quality, the best price, and the greatest outcomes when it comes from training.

I close with an invitation to all of you, and that is to think about a rather dry topic, but the federation reform agenda. At present, the Prime Minister is developing a white paper in relation to how the Australian federation works, what the most efficient allocation of responsibilities between the Commonwealth and the states are. And when he met with state premiers and leaders just a few weeks back, one of the striking parts of the communique they issued was a statement having a look at whether vocational education and training should be funded on a consistent national approach rather than a piecemeal state-by-state approach. That was backed up yesterday by the big talkfest think tank exercise that occurred in Sydney, led by a number of entities, who put a national approach to vocational education and training close to the top of their agenda.

So I encourage you as an industry that is so reflective of every corner of this country to think about whether that is ideal, and how that would work. There will be opportunity for comment – as the Federal Government we’re not wedded to any particular outcome from this, aside from an outcome that gives us the best capacity to fund vocational education and training in the future in a way that delivers our country with the skills we need. Because we do know that sectors like yours are willing to invest in skills of your employees, that you’re willing to invest in growing our economy and the competitiveness and productivity of our economy, and as a government we want to get the structures right to help you to achieve that, to the greatest success possible.

So again, thank you very much for the thoughtful policy input you provide at so many different levels as an organisation, for the jobs and economic activity you contribute to the country, and for coming here to the wonderful Adelaide Oval in my home city of Adelaide and home state of SA, and wish you every success and pleasure in your discussions, and especially for the opportunity to join tonight and speak with you tonight.

Thank you very much.

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