Industry Skills Fund Youth Pilot Programmes
Discussion Paper
Department of Industry
1. Introduction
1.1 Purpose
On 8 September 2014 the Prime Minister and the Minister for Industry announced two pilot
programmes:


Training for Employment Scholarships
Youth Employment Pathways.
This discussion paper has been developed by the Department of Industry (the department) to
provide stakeholders with more information on the design and implementation of the pilots.
This paper sets out a range of design considerations. Feedback from this paper will inform
the final programme guidelines and stakeholders are encouraged to have their say on matters
contained in this paper.
The department will issue the proposed guidelines for both initiatives prior to their
commencement on 1 March 2015.
1.2 Policy Environment
Across Australia youth unemployment is almost double the national unemployment average.
Many employers are hesitant to take on unskilled or new workers as in-house training is
resource intensive and external training is costly. For training to be valuable to employers and
individuals it must be linked to the needs of their business and the job role.
Low levels of educational attainment and poor transitions to work have impacts on the
individual, society and the economy. Disengaged youth are at a higher risk of not making a
successful transition to work.
Australia needs a highly skilled and highly motivated workplace to take advantage of
competitive advantages and market opportunities. Small and Medium Enterprises (SMEs),
including micro businesses, employ almost half of the Australian workforce. Investing in our
workforce is key to increasing business productivity and taking advantage of new economic
opportunities.
There are a range of supports in place for young people accessing Australia’s training
system. These include targeted support for apprentices and the National Training Entitlement
as administered by states and territories. However, given the level of youth unemployment
there is a need to trial alternative approaches.
These pilots will trial a new way of boosting economic activity in regional areas and improving
job prospects for young people.
1.3 Overview of the pilot programmes
The pilots encourage businesses to employ and invest in young people living in regional
Australia during a period of high youth unemployment.
Training for Employment Scholarships will:



provide up to 7,500 scholarships for unemployed youth aged between 18-24
be available to SMEs in those regional areas selected as pilot sites
support employers by covering the cost of up to 26 weeks of job specific training for
their new starters.
1
This pilot will assist young people who are ready for employment, but do not have the
required skills or the entry level training qualifications to commence in a job.
Businesses will benefit by having access to workers who have the skills needed by the
employer.
The Youth Employment Pathways will:
 assist 3,000 disengaged youth aged between 15-18 who have left school
 be provided by community organisations in regional areas selected as pilot sites
 transition pathway participants back to school, into the workforce, or on a vocational
education pathway.
Community organisations will be able to apply for a pathway place on behalf of a young
person and, through a tailored learning plan, will help individuals back on to a learn or earn
pathway.
The government understands that places in the pilot programmes are limited, however being
new, the effectiveness of the pilots in responding to the needs of employers and young
people must be evaluated before any further roll out is considered.
1.4 Single Business Service
The pilot programmes will be delivered through the department’s new Single Business
Service that streamlines the way businesses access industry information and services, by
putting their needs first – reducing red tape and providing quality, consistent services at the
lowest possible cost.
The Single Business Service assistance is available through a consolidated online presence,
a contact centre and a face-to-face facilitation network to advise businesses and other
organisations on the most appropriate programmes and services. It is a universal offering
available to any business in Australia. It makes information simple and easy to find and is
available anytime and on any device.
2. Proposed design
2.1 Target regions
The pilots will be trialled in a limited number of regional sites. The pilots are intended to be
rolled out on a small scale to targeted regions and then evaluated.
Target regions will be selected based on a combination of factors, including
 areas with high youth unemployment
 areas with employment growth opportunities
 areas with a high number of SMEs.
For the scheme to be successful, employers and SMEs in the area must be willing and able
to take on new workers.
2
Questions:
Should additional criteria be considered when selecting regions for each pilot?
What local conditions are required for the pilots to be effective?
Appendix A lists the regions in each state and territory where youth unemployment is highest,
according to data published by the Australian Bureau of Statistics. A number of further youth
engagement and labour market indicators are also provided.
Stakeholders may wish to respond to the issue of target region selection by reviewing the
data and identifying what other criteria are important when identifying suitable regions.
2.2 Who is eligible?
Training for Employment Scholarships
SMEs operating in the target regions will be eligible to apply for a scholarship. SMEs are
defined as an actively trading business with up to 199 employees.
The scholarship must be used for a new employee aged 18-24 who was previously
unemployed. The period of employment must be no shorter than 12 months and provide
employment for a minimum of 25 hours per week.
Employers will be required to demonstrate a training plan has been agreed with a training
provider when applying for a scholarship. The training provider must not be related to the
employer.
Question:
Should any further criteria apply to businesses seeking access to scholarships?
There are some considerations for establishing individual criteria. These could include
whether the pilot is open to any employee who meets the eligibility requirements and is new
to the organisation, and this could include longer term unemployed as well as school leavers.
It may include a worker who has very recently moved to the target region and needs some
upskilling for the local industry but is not a registered job seeker.
Questions:
Should any further criteria apply to young people eligible for training?
What individual criterion should be considered out of scope?
Should there be a focus on those who have been unemployed for a minimum period
(e.g. 6 months)?
Youth Employment Pathways
Community service organisations operating in the targeted regions will be eligible to apply for
payment for training and/or support services delivered to individuals. The young people
assisted must be aged 15-18 and not in school, education or employment.
The department is seeking input on the necessary skills, experience and capacity of
community service organisations to be most effective in supporting disengaged youth.
3
Questions:
What criteria should be applied to organisations?
Should any further criteria apply to young people eligible for support?
Should there be a waiting period after leaving school before young people are eligible
for this support?
2.3 What activities are eligible?
Training for Employment Scholarships
Scholarships are proposed to support accredited training up to Certificate II and may
incorporate core skills and capabilities such as literacy, language and numeracy support; soft
skills such as working in a team; business skills such as budgeting, computer literacy; and
pre-apprenticeship pathways.
A broad range of training and skills, such as driver’s licences, forklift licences, responsible
service of alcohol accreditation and the construction white card, which may be considered
prerequisites to employment, could also be supported.
Stakeholders are invited to comment on accredited and unaccredited training that will be most
effective in assisting employers to equip new workers with the skills they require.
Once an employer has identified the skills their business and new starter need it will be up to
their chosen training provider to package the short courses or skill sets into a high quality
training programme.
Questions:
What training will be most effective?
What training should be excluded from scope?
Youth Employment Pathways
Providers will assess a young person’s needs and provide individualised services that may
include the purchase of training that supports entry to the workforce and/or provide intensive
case management; support to address non-vocational barriers; and support to link
participants to school, training or employment.
Questions:
What support will be most effective for disengaged youth?
What should be excluded from scope?
2.4 Who can provide training and support
Central to the success of the pilots will be the provision of flexible, high-quality and business
tailored training, which may occur on a training campus or on-the-job in the workplace.
Training organisations selected by employers will be required to be registered as an RTO and
meet general criteria regarding their demonstrated ability to deliver the training at competitive
rates. Community groups in regions selected as pilot sites will need to submit a short
‘expression of interest’ to be eligible to provide training to pathway participants. Successful
businesses will be published on a list for community organisations to access.
4
2.5 Expressions of interest from training providers or
community organisations
Training for Employment Scholarships
Training providers engaged by the employer are expected to meet general requirements,
including:




registration as an RTO on the National Register
demonstrated experience delivering training suitable to the pilot (including formal
qualifications, skill sets and short courses)
an indication of cost of delivery for short courses or a price for a 26 week training
programme
demonstrated links and partnerships with local employers and industries.
Question:
Would it be favourable for training providers to be pre-qualified, or should this occur on
a rolling basis as employers apply for a scholarship?
Youth Employment Pathways
Further details for the expression of interests will be released in 2015 however it will require
community organisations to provide information on:



demonstrated experience working with disengaged youth and vulnerable
communities
demonstrated links and partnerships with local employers, schools and training
providers
an indication of the cost of delivering a pathway programme.
Approved providers will need to agree to the terms and conditions of the pilot
programmes-this includes the proposed payment schedules.
Questions:
What are the most important criteria for the department to consider when accepting an
expression of interest?
Should there be any additional criteria when considering who is approved to provide
the training?
5
3. Applications and funding
3.1 Application processes
The department intends to create a simple online rolling application process.
This may comprise an online eligibility check which would issue a scholarship or pathway
reference number which would then be used for payment.
Ease of application and timely payments are a focus for the department. Responses from
stakeholders are sought as to their preferred method of engaging with the government for
application, evidence and payment processes.
Training for Employment Scholarships
Question:
What is the simplest way to confirm the individual is a new worker?
Youth Employment Pathways
Questions:
What is the simplest way for providers to apply for a pathway on behalf of a young
person?
What can be considered adequate evidence to determine eligibility?
3.2 Funding arrangements and outcomes
The government has been very clear that the era of training for training’s sake is over.
Both pilot programmes are focused on achieving real outcomes and payments will reflect this.
Training for Employment Scholarships
Payment will be made to the employer on completion of training by the individual. Evidence of
completion and payment from the employer to the training provider will be required.
Small businesses (0-19 employees) may be able to receive 10 per cent up-front and the
remainder on completion of training if they would otherwise find it difficult to manage
financially.
While the growth stream of the Industry Skills Fund requires a co-contribution, this pilot will
not operate on a co-contribution basis. The investment through engaging a new employee for
a minimum of 12 months is considered a suitable mutual obligation commitment.
There are a limited number of places that can be filled under this pilot.
Youth Employment Pathways
Payment will be made to the provider in stages. Suitable evidence will need to be provided at
each milestone.
6
Three milestones are proposed which will coincide with payments:



on engagement of an individual
on completion of training and/or support services
on achieving an outcome - transition of the participant back to school, into work or
further vocational training.
There are a limited number of places that can be filled under this pilot.
Questions:
What are the appropriate payment milestones that would permit uninterrupted support
to the individual?
Should providers seek payment against individuals or against a group of individuals?
What would be considered adequate evidence to claim payment?
4. Having your say
4.1 How to provide feedback
The Department of Industry is seeking stakeholder input on the design of the pilot
programmes.
To ensure that the pilots are able to open from 1 March 2015, responses to this discussion
paper are sought by 14 November 2014.
To assist the department in compiling and analysing the views of all stakeholders,
respondents are encouraged to provide their feedback via email to
VETTaskforce@industry.gov.au.
Respondents may provide feedback on some or all of the topics in this paper.
7
Appendix A
Regions in Australia where youth
unemployment is highest, and selected
characteristics
NSW
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
Richmond - Tweed
19.8
7621
1737
8.2
18.7
27170
Mid North Coast
18.9
5965
1737
9.5
25.4
21455
Illawarra
18.7
7504
1471
7.0
12.3
41568
Newcastle and Lake Macquarie
14.8
10925
2761
7.4
11.5
50174
Coffs Harbour - Grafton
13.9
4239
1737
8.7
22.4
15782
12
7904
315
7.0
16.2
27327
Hunter Valley exc Newcastle
11.7
7368
2761
8.0
15.8
33730
New England and North West
11.2
7554
651
9.4
18.6
24718
Riverina
10.9
6459
656
7.4
13.8
21998
7
4745
656
7.0
13.5
14539
5.7
4983
385
8.4
17.3
15956
4793
581
10.9
21.9
14688
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
Shepparton
25.3
5064
1183
7.4
18.0
15648
Hume
19.8
6324
1183
6.5
14.8
19601
Bendigo
18.8
4899
1183
6.4
13.6
19122
Geelong
18.2
8036
1156
6.0
11.6
33992
North West
15.4
7267
481
7.7
18.9
17868
Warrnambool and South West
13.4
5472
1156
5.6
14.6
14962
Latrobe - Gippsland
10.2
8776
913
7.4
16.9
30598
9.1
5050
469
6.4
13.7
20560
ABS Region
Central West
Murray
Southern Highlands and Shoalhaven
Far West and Orana
-
VIC
ABS Region
Ballarat
8
QLD
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
Townsville
22.5
7000
3455
8.9
12.3
36390
Cairns
20.2
8753
3455
11.1
21.0
29596
Wide Bay
18.7
8049
2329
13.0
26.2
31551
Queensland - Outback
17.8
2764
278
19.1
23.7
12054
Darling Downs - Maranoa
16.7
5968
2329
9.0
18.5
15036
Gold Coast
16.5
21236
3278
8.0
12.9
74806
Sunshine Coast
15.3
12799
1356
8.2
14.9
38079
Fitzroy
10.9
6873
2329
8.6
15.0
31233
Mackay
6.9
6577
3455
8.0
12.6
23603
Toowoomba
3.2
4616
1337
7.5
13.8
21777
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
South Australia - Outback
29.8
2871
266
10.9
21.5
11098
South Australia - South East
19.5
7288
415
7.5
19.3
20122
Barossa - Yorke - Mid North
7.3
4351
114
7.9
19.7
11354
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
11.2
6549
833
9.3
20.0
14701
Bunbury
4.9
5661
571
8.1
16.6
20300
Western Australia - Outback
2.8
6672
1428
14.2
17.3
30086
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
South East
26.7
1127
928
8.3
23.5
3473
Launceston and North East
20.6
4540
341
8.2
15.7
18739
West and North West
13.6
3270
261
8.8
20.6
13828
ABS Region
SA
ABS Region
WA
ABS Region
Western Australia - Wheat Belt
Tas
ABS Region
9
NT
ABS Region
Northern Territory - Outback
Unemployment
rate 15-24 yrs
(%)
July 2014
Total
SMEs
in region
(no.)
(July
2013)
Internet
vacancies
(no.)
(July
2014)
NEETs
15-19 (%)
(2011
Census)
NEETs
20-24 (%)
(2011
Census)
Population
15-24
years (30
June 2013
ABS)
18.6
1578
489
28.4
39.4
16128
NOTES:
Unemployment rate is for July 2014, Labour Force Survey ABS
SMEs by region, ABS (81650 Counts of Australian Businesses, including Entries and Exits, Jun 2009 to Jun 2013)
Internet Vacancy Index (IVI) data sourced from the Department of Employment for July 2014
'Not in Education, Employment or Training' (NEET), ABS 2011 Census of Population and Housing
Population figure for 15 to 24 year olds, ABS 2011 Census of Population and Housing
10