Budget 2018: lower funding for apprenticeships

Federal funding promised for apprenticeships and training by 2021 has been cut by $200 million.

Federal funding promised for apprenticeships and training by 2021 has been cut by $200 million as a revenue shortfall forces the government to overhaul and extend its troubled skilled workers fund.

A year after the fund was announced, the government has yet to sign a single agreement with any state or territory to generate a promised 150,000 apprenticeships across four years.

The government also has failed to pass legislation to impose a levy on employers bringing in overseas labour. Proceeds from the levy were to be channelled into the fund.

To overcome the lack of revenue, the government will provide $250m this financial year to fund projects, while extra funds totalling $50m will be made available to state and territory governments that sign up by June 7. However, the amount of new money to be allocated across the next three financial years will be $200m less than forecast in last year’s budget papers.

According to departmental officials, $293.4m will be spent next financial year compared with $360m promised last year. Almost $100m less will be spent in 2019-20 while $32m less than promised last year has been allocated in 2020-21.

The government is promising to spend $1.523 billion across five years compared with the $1.475bn that it promised last year to spend across a four-year period. Last year’s budget papers forecast $1.2bn would be raised from the levy but that amount has been revised down to $1.023bn.

The government also has expanded the refund and exemption provisions of the fund.

The $350m that was to be spent this financial year was made up of $261.2m in government funding and $88.8m in levy revenue that was never collected. The $261m now has been split across the budget forward estimates.

States and territories will be able to access money from the scheme only if they match the federal funding and rules set down by the Turnbull government that include priority occupations.

The government will take new measures to combat illegal “phoenixing” — where companies declared insolvent restart under a new name — at a cost to the budget of $40m across three years.

The director penalty regime will be extended to GST, luxury car tax and wine equalisation tax, making directors personally liable for a company’s debts.

The Australian Taxation Office’s powers will be extended to retain funds where there are outstanding tax lodgements. New offences will be introduced to target illegal phoenixing while law changes will seek to prevent directors improperly backdating resignations to avoid liability.

The government also will increase funding to its union regulator, the Registered Organisations Commission, by $8m across four years.