Wage subsidies to be available for second and third year apprentices from October

The federal government will expand its apprenticeship wages subsidies program to cover apprentices in their second and third years. 

Announced by Small Business Minister Stuart Robert earlier this week, the new Completing Apprenticeship Commencements program will represent a $716 million addition to the existing Boosting Apprenticeship Commencements program, which was first announced in the 2020 federal budget.

The Boosting Apprenticeships Commencements program currently provides subsidies of 50% of wages for new or recommencing apprentices for eligible businesses and group training organisations that hire an apprentice between October 5, 2020 and March 31, 2022. 

The subsidy is paid over a 12-month period, with a maximum of $7,000 per quarter. The program was initially capped at 100,000 places but was later extended to be offered on a demand-driven basis for an additional 12 months. 

The latest extension, which will commence in October 2021, will provide eligible employers with a 10% wage subsidy in the second year of an eligible apprenticeship, followed by a 5% subsidy in the apprentice’s third year. 

Employers must have already received support under the Boosting Apprenticeship Commencements program in order to qualify for the second and third year subsidies. 

The government says the program will provide additional support to the 270,000 apprenticeships that are expected to be covered by the existing Boosting Apprenticeship Commencements program between October 2020 and March 2022. 

According to Minister Robert, there were 348,200 Australians in apprenticeships and traineeships as of June 2021, which represents an increase of 30% on the previous year. 

Robert said this extension aims to give employers confidence to retain second and third year apprentices “right through to completion”. 

Dominic Schipano, national executive officer of not-for-profit industry training organisation CITT and director of the Council of Small Business Organisations Australia, welcomed the extension of government support this week, as did national employer association Ai Group. 

The extension will improve apprenticeship retention rates and boost the number of tradespeople in areas that are experiencing skills shortages, said Ai Group chief executive Innes Willox. 

“The support will be particularly important for employers facing COVID financial pressures who had been weighing up whether they could afford to retain their apprentices,” said Willox in a statement. 

More information about the Boosting Apprenticeship Commencements program is available here.