Apprenticeship fees scrapped for all from July 1

Ross Faulkner (right) hopes to keep on his eight apprentices, including carpentry apprentice Dan Andresen (left). Photo / File

The Government has scrapped fees for all apprentices from July 1 in a bid to maintain trades training through the Covid-19 recession.

The $320 million programme aims to stave off a sharp drop in training that occurred after the global financial crisis, when trainees plunged from 133,000 to 83,000.

It will be funded out of a four-year, $1.6 billion package announced in last month's Budget, which also includes a further $412m employer apprenticeship subsidy which has yet to be detailed.

The Budget said the $320m fund for free trades training would be restricted to "courses linked to industry skills needs in building and construction, agriculture and manufacturing and also vocational courses like community health, counselling and care work".

Education Minister Chris Hipkins says the free courses will now be extended to all apprentices in all industries.

However, apprentices and trainees in targeted sectors will have compulsory student services fees and other compulsory course costs paid as well as their training fees.

The targeted sectors for the rest of this year are:

• Primary industries, including agriculture, horticulture and viticulture, fisheries (including aquaculture) and forestry;

• Construction, including building, plumbing, and civil engineering;

• Community support, including youth work, care for elderly, counselling and community health, including mental health and addiction support;

• Manufacturing and mechanical engineering and technology;

• Electrical engineering; and

• Road transport (eg heavy vehicle operator).

"For 2021, we will refine these initial targeted areas to reflect the work that is under way across Government to better understand how industry workforce needs are being affected by Covid-19 and what skills will be needed to support the country's economic recovery," Hipkins said.

The measures will apply to existing apprentices and trainees as well as new sign-ups, and will apply from July 1 this year until December 2022.

Trainees will save up to $6780 for an NZ Certificate in Mechanical Engineering.

The move comes just in time, as Statistics NZ said building consents for new dwellings in April dropped 17 per cent below the same month last year due to the Covid-19 lockdown.

Building and Construction Industry Training Organisation chief executive Warwick Quinn said the drop could have forced employers to lay off up to 30 per cent of their apprentices without Government support.

"At the moment our apprentice numbers are holding up, however we are not seeing the number of signups because of the large drop-off over the lockdown," he said.

"We have quite a number waiting in the wings for the Government's announcement on free fees - several hundred waiting for that decision."

BCITO chief executive Warwick Quinn (right), with Daniel Poe (left), the 11,000th Kiwi apprentice working towards a building qualification. Photo / File

He said some employers were ready to hire more apprentices with Government support.

"I had a call from a pretty large contractor asking, 'Do you think there will be sufficient support that will provide me with enough to be able to employ someone fulltime so I can manage all of my apprentices? If I could afford to, I would take on another 30'," Quinn said.

"My hope is that that is going to happen. They are quite a big commercial builder in Wellington."

Auckland builder Ross Faulkner, who has eight apprentices, said he intends to keep them all even though house-building projects he had lined up before the lockdown for an architect and two Air NZ staff have been put on hold because of the Covid-19 crisis.

"Stress levels are rising, you might say," he said.

"We have been able to juggle things around to make it work, and we are expecting a few jobs to come through in the next week or two."

Ross Faulkner (right) hopes to keep on his eight apprentices, including carpentry apprentice Dan Andresen (left). Photo / File

Even in past recessions, Faulkner has kept all his apprentices by sharing them with other builders when necessary.

"I haven't had to lay anybody off in my career."

He said a 2013 apprenticeship "reboot" by the Key Government, which paid $2000 to every new apprentice and their employer in the construction industry, "made it more attractive for me to take on two or three at that stage".

Details of the promised $412m employer support this time are still awaited.