PM plans to rush out vocational training reforms

JULIA Gillard will fast-track her planned shake-up of the vocational training sector.

Julia Gillard

JULIA Gillard will fast-track her planned shake-up of the vocational training sector.

The Prime Minister warned yesterday that existing systems were ill-equipped to teach Australians the skills needed in new-economy jobs in areas such as high-quality manufacturing.

She has also promised tax breaks for companies to reward innovation, warning that manufacturers must shift "up the value chain" to relieve the strain they are facing from the strength of the Australian dollar.

After months of complaints from unions, steelmakers and the car industry over pressure on manufacturers caused by the value of the Australian dollar, Ms Gillard used a speech yesterday to the Australia-Israel Chamber of Commerce in Melbourne to highlight the folly of Australian manufacturers seeking to compete with overseas rivals on price when they should be focused on quality.

But as she called for more innovation and specialisation among manufacturers, Ms Gillard said she would bring forward a review of the training sector to ensure training matched the requirements of the new economy.

The review would be funded under her government's $1.75 billion, five-year skills package, announced last year.

"The level of the dollar and the pace of its rise has broken some business models and forced economic restructuring," Ms Gillard said yesterday.

"We've said for years, for decades, that given a choice between competing on quality or competing on price we'd compete on quality; that we'd take the high road to high-value, high-wage, high-skill employment; that we want to create jobs based on making and selling the best products and services we can.

"The strong dollar is locking in that high-value, high-quality approach for us. It's as if the world is turning up the speed on the treadmill while we're exercising."

Ms Gillard, who revealed in The Australian last week that she planned to introduce HECS-style income-contingent loans to the training sector, said economic circumstances demanded reform in vocational education.

"A new economy, driven by change, demands workers every bit as innovative as its firms, whose skills grow as quickly as the sophistication of the technology they use every day," she said.

"That's not just for scientists . . . it's for advanced manufacturing and mining, agriculture and logistics, and it's in the shops and workshops we visit every day."

The Prime Minister said she would release details of her training reforms in coming weeks and seek the co-operation of the states and territories through the Council of Australian Government.

Her plans include abolishing upfront fees, upfront loans and subsidies of up to $7800 per student.

Tony Abbott said the address failed to address economic issues such as debt and cost of living.