2015 E-Oz Energy Skills Australia Annual Conference, Hyatt Hotel, Canberra, Tuesday, 27 October 2015

I want to thank you for the opportunity to join you today – as the daughter and sister of electrical engineers who trained as apprentices, I retain a great interest in your work.  My Dad finished his career as a Mines Safety Inspector and instilled in all of us a profound respect for the significance of safety, skills and professionalism.

 

The theme of your conference this week, “Your Future and the Energy Space” has plenty of emerging challenges and opportunities to cover as we see continuous change in the sector and the need for a training sector with the capacity to, not only respond, but seize the opportunities by pre-emptive action.

 

Although it is not only in your industry sector that we see this – it crosses all industry sectors.

 

In August this year we saw public media reports of the significant impact that emerging and ever-evolving technology will have on how we work and, therefore, how we train the workers of the future.  It is abundantly clear that innovation will be key to how we teach, how students access education and training and how businesses utilise the innovative capacities of their workforce to grow and succeed.

 

Most of you would be aware that the Foundation for Young Australians at that time released their report, The New Work Order: Ensuring young Australians have skills and experience for jobs of the future, not the past”.

 

This report showed that approximately 71 per cent of young Australians currently in VET courses are preparing for occupations where at least two-thirds of the jobs will be automated over coming decades.

 

CEO, Jan Owen, said:

 

“We need to provide our young people with a different set of skills – to allow them to navigate their way through a diverse employment journey that will include around five career changes and an average of 17 different jobs.  We must start thinking differently about how we back young people for the jobs and careers of the future, so they don’t get stuck in the past.”

 

I couldn’t agree more.  Before too many young people in training start wondering if they should drop out because their course won’t be worthwhile, I should say that I believe the challenge is to build into our course content and our teaching methods an increased focus on critical thinking and problem-solving and digital literacy and utilisation.

 

What we actually need for innovation is learners who, to use a very old phrase now, are “self-empowered” learners.  What we should be ensuring is that they graduate from your courses able to assess their need for further knowledge and skills and know-how to gain these. 

 

The automation that will disrupt so many current jobs will be accompanied by globalisation and an increased focus on collaboration that can open new doors to these very workers, new jobs, new careers, even new small businesses, if they are equipped to take them up.

 

Labor federally is also very aware and focussed on developing policies to ensure the nation is prepared for these changes.

 

In his Budget Reply speech, Bill Shorten outlined significant policies to support the extension of science, technology, engineering and maths skills across the education sector. 

 

In an address to the Australian Workplace Practitioners Network in March this year I discussed with them the importance of emerging literacies, alongside the importance of language, literacy and numeracy as we traditionally defined them.  I said at that time:

 

“The world of work, and indeed, the ability to participate in civic and community life is increasingly requiring a population with new literacies – including in financial and digital knowledge and skills.

 

Our personal and work life is increasingly complex and people will require better understanding of the financial sector to be a more informed consumer.  It is critically important to developing this literacy that people have a solid grounding in both literacy and numeracy from which to build their expertise in financial literacy.

 

This more complex world also encompasses a more digital life – for work and play, for solitary reading and family skype catch-ups, for shopping and submitting health claims.  Each of you could easily add to this list to reflect your own daily life I am sure.

 

Like financial literacy, being digitally literate is increasingly a requirement for full and meaningful engagement in economic, social and civic activities.”

These developments demand of us all that we ensure all of our education and training enables the next generation to have the underlying knowledge and skills they will need in all employment sectors to, not only manage change, but to grasp it and utilise its benefits.

 

In a Matter of Public Importance debate in the Parliament in June on “The Government’s Failure to Plan for the Jobs of the New Economy”, I referred the House to the critically important environmental scans that are done each year by Industry Skills Councils such as your own, (who have sadly been defunded by the Federal Government), and I particularly quoted from the most recent scan released by Innovation and Business Skills Australia which said:

 

“The impact of technology broadens each year as it is felt in all aspects of business operations, all sizes of business and all industries. Customer service is being enhanced through data analytics which are providing complex analyses of consumer behaviours, paper based printing is being subsumed by mobile electronic options, finance and business services are operating anywhere and anytime using cloud based applications on a wide variety of devices. Nationally and internationally, convergence and collaboration are occurring in the workplace and between and within industries, suppliers and clients.”

 

E-Oz’s own environmental scan for 2014 describes a significant shift, or “disruption” as the more trendy version is described, in the energy sector.

 

In the section “An Internet of Things” we see a great description of this major shift in the energy grid network from ‘behind the meter’:

 

“Each of the technologies… can become parts of an internet of things which together provide new ways for the various players in the energy market to interact … the combination of smart metering with intelligent consumer appliances and systems will extend the networks to another layer, bringing the local ‘intranet of things’ from behind the meter, into the internet of things.”

 

The report identifies further that:

 

“Via the internet of things consumers will seek optimisation and maximise benefits by being able to (either automatically or by human intervention) take into account how all elements of the consumer’s local ‘intranet of things’ for example, a home, business or factory, work together. This will be facilitated by the consideration of historical, actual and predicted costs and usage data to inform consumer choice.”

The report rightly concludes:

 

“The deployment of these technologies require that new technical and service skills to be available, within applicable regulatory frameworks, to support the installation, calibration, interconnection and synchronisation of intelligent appliances and systems at various scales, both within and between networks.”

 

This is no small challenge for each of you and it points us also to the importance of dedicated and well-trained professionals driving the VET sector, capable, themselves, of adapting and deploying innovation to meet these challenges. As stated in your environmental scan:

 

“Leading developed nations are now establishing ‘early warning systems’ to quickly detect the onset of trends and building agile vocational training systems capable of responding once issues are identified.”

 

I absolutely agree with this assessment but I am very sorry to report that the current government does not seem to share this view.

The former Abbott Government’s eagerness to remove any traces of good Labor programs and policy saw them act, I believe very prematurely, to abolish the Australian Workforce and Productivity Agency (AWPA).  The decision to axe our peak strategic policy and research body on skills was made with no formal announcement, not even a media release. 

AWPA was established in 2012 by the former Labor Government, replacing Skills Australia, to provide expert, independent advice to government on current, emerging and future skills and workforce development needs.  AWPA brought together the peak national bodies such as ACCI, AiGroup and the ACTU to achieve industry leadership.  AWPA also took a tripartite approach to skills and training where industry, training providers and unions had a strong voice. 

I was, and remain, deeply concerned about the Government’s continual narrowing down of its access to advice by completely abolishing Industry Skills Councils. It is hard to see how losing the decades of experience of the many board members of these councils improves the quality and depth of advice to the Government.

The other portfolio matter I’d like to talk about today is the serious impact of recent Government cuts on the Australian apprenticeship scheme and enrolment and completion numbers. 

Since the election of the federal Liberal Government we have lost almost 100,000 apprentices according to the National Centre for Vocational Education and Research report released in September for the March quarter. 

Apprentices and trainees in training in September 2013 at the time of the change of government, totaled nearly 418,000.  In March this year this had plummeted to just 319,700. 

The Federal Government’s record is appalling on apprenticeship promotion and support. Their record includes:

  • $1 billion in cuts to apprenticeship programs such as mentoring, access and the Apprentice to Business Owner program  in the 2014-15 Budget;

  • Replaced apprentice support with apprentice debt by abolishing the Tools for Your Trade Program;

  • Rebadged and cut funding to Australian Apprenticeship Centres;

  • Abolished the Joint Group Training program; and

Cut support for adult apprentices. 

They have developed no new incentives to address the drop in apprentice numbers much less to get ahead of the game by looking for innovation and opportunity in this sector. 

Many of these programs of the former Labor Government were targeted directly at support and extension of the apprenticeship scheme.  I would like to particularly acknowledge the project e-Oz undertook in 2013, the Energy Industry Apprentice Progression Management System.  

This was a two-year project through the Australian Government Skills Connect initiative under funds from the Accelerated Australian Apprenticeships Initiative, the Australian Apprenticeships Advisers Program and the Australian Apprenticeships Mentoring Program – now all gone. 

I believe it is a serious indictment on the government that a project such as this has been abolished despite its fantastic outcomes.  The project doubled the retention rate to more than 90% of apprentices – the retention rate in the most recent NCVER report showing a drop of nearly 18% to 40,600 across all sectors. The completion rates for apprentices across the standard four year training was only 62% over the previous five years, with most dropping out in the first two years. 

I was particularly interested in the innovations that had been trialed in this project, clearly with great success: the application of a mentor to each apprentice, the web-based readiness assessment tool (which I understand was utilised by nearly 10,000 potential apprentices) and the more regular competency testing. 

Your industry environmental scan identified a short-term drop in apprentice numbers despite continued reported skills shortages.  Projects that work to reverse this trend are actually even more critically important at such a time or shortages become critical in the medium to long-term.  As the report states: 

“Unfortunately, for the industry to respond to the challenges of the deployment of intelligent systems and smart appliances, investment in skills is required.” 

The other significant workplace trend that continues to emerge is the growth in sole trader, small business operators.  Many of the apprentices who complete training in your industry sector already go on to set themselves up in this way.  As households become more complex environments with energy coming out from “behind the meter” that number and complexity of their requirements of the tradespeople running their own businesses in the sector will exponentially increase. 

This is why I think it was short-sighted of the Government to abolish the Apprentices to Business Owner program which had only just got up and running at the time of the change of government. 

As Minister in May 2013 I was very pleased to announce the start of this $19.4 million program. We quite clearly understood that across a whole lot of industry sectors people finish their apprenticeship and then go out and operate as a sub-contractors, sole operators or small businesses and the AtoB program was a good initiative to provide them with the sorts of skills they might need that you don’t get in your apprenticeship, those sorts of small business management skills, as well as trade specific skills and licensing training. 

The entry-level jobs market is changing.  It has become more difficult for young people to get their first job, employers are regularly advertising entry-level jobs with a two year minimum experience requirement and vocational training is increasingly important as the pathway between leaving school and getting a job.  

We must get the pathway for our young people from school to work operating as effectively as possible, we must ensure a strengthened post-secondary sector, our public TAFEs are a national asset that have been too consistently decimated in recent years, and the quality private RTO sector is being badly undermined by shonky providers. 

The pathway to work through vocational education and adult second-chance education and training is absolutely critical to our national economic well-being, growth and job opportunities.  A quality VET sector delivers the skills needed to continue improving productivity and participation – it has a hard economic value as well as a significant social dividend.  

In a modern economy where these pressures are coming more quickly and requiring agile responses from businesses we must be ensuring that the workforce are not only trained with the relevant skills on entering the industry but also supported to access quality training, retraining and skills development. 

The Federal Government has failed dismally to meet this challenge.  There is a lot of VET reform happening, some of which I support, but too much funding has been cut and programs abolished to meet the task before the sector. 

I know that as individuals and a peak organisation these challenges also exercise your minds and I look forward to continuing to work with you in the future on the policies the nation and your industry need for a successful future.