Training System Needs Reform

In his reply to the 2004 Federal Budget, Opposition Leader Mark Latham committed a future Labor government to a "train or work" policy.

Under this policy, all able-bodied people will be given two choices -- either work or train.  No sitting around collecting the dole.

This is a positive re-affirmation of the Labor Party's commitment to mutual obligations.

Nonetheless, if it is to be successful and get people into good paying jobs, it will need to be accompanied by more money (which Latham promised) and root and branch reform of the training system.

The Australian training system was established in the late 1980s and no longer fits today's environment.  Indeed, it was out of date almost before being completely established.

The system arose out of efforts by the ACTU to slow the momentum towards enterprise-based bargaining while satisfying its members' demands for productivity-based wage rises.

The solution it hit on was awards restructuring coupled with competency-based training.  Under this system the ACTU, along with the employer association, decided what jobs industries required and what training was needed to do the jobs and locked these into the awards.

They then negotiated a detailed training framework which supported the awards and got government, in large part, to fund the training.

The promise was that this would create career paths for employees, guaranteeing them wage increases as they moved up the career ladder on the basis of skills they acquired.

It also brought training under the control of the industrial relations club, thereby helping to guarantee its continuation in the face of declining union membership.

The system was always deeply flawed.  First, it is not relevant to most businesses.  The job specifications and training levels were driven not by the needs of business but by agreement among third parties.

They were also provided through the industry-based awards system when most people are employed under enterprise or individual agreements, or as contractors.

The system also gives the wrong signal to employees -- that is, all they need to do for a wage increase is to get training rather than perform.  As a result, employers are reluctant to fund or utilise the system.

Second, it does not match the needs of workers.  The model is based upon the assumption that people work in the same firm or career throughout their working lives, and via seniority and training, steadily progress up an established pathway.

This, however, does not fit the work experience or demands of most people.

Most people can expect to pursue multiple and often divergent pathways over their work career, including, at times, starting again.

The training system -- and awards system -- does not meet these needs.

The system is not starved of funds.  Indeed, the Australian National Training Authority, which supports and fosters it, has a budget in excess of $1.2 billion.

As a CEO of a major company recently observed of the National Training Agenda:  "It's just this 4000-pound marshmallow that's out there".

Last thing we want is for the unemployed to be trapped in a messy and costly marshmallow.

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