Budget 2020: More than $2 billion to get Kiwis into jobs post Covid-19

Thursday, 14 May 2020

The Government’s 'Jobs Budget' is set to open up free vocational training for all New Zealanders during the next two years.

The Government is also giving the Ministry of Social Development a $400m boost and investing $1.6 billion in trades and apprenticeships.

It intends to rapidly retrain about 10,000 hospitality and aviation sector workers for primary sector jobs as part of Budget 2020’s investments in jobs and training.

The funding is part of a $50b fund to respond to the coronavirus crash and rebuild the economy, with $16b allocated on Thursday, $14b already spent, and another $20b available if needed.

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TRADES AND APPRENTICESHIPS

The $1.6b Trades and Apprenticeships Training Package aims to give the economy a boost by opening up opportunities for those who lost jobs during the Covid- 19 crisis, or need to upskill for a new career.

The fund will be available from July 1, and will include courses linked to building and construction, agriculture, and manufacturing, as well as also vocational courses like community health, counselling and care work.

Education Minister Chris Hipkins said it was important to invest in training and education for people who might have lost their jobs in the crisis, or wanted to move into a different sector, where prospects are better.

The Budget also allocates $320m for ‘targeted investment’ for free trades training in critical industries, $412m for employers to keep training their apprentices and $19m for group training schemes to retain apprentices.

The volume of Trades Academy places in secondary schools will increase by 1000 places a year from 2021, with the aim to build up a future skilled workforce.

Hipkins said making targeted vocational training courses free – for all ages, not just school leavers - would help people who have lost their jobs retrain and also allow new employees in some essential services to train on the job.

“The initiative to support employers and group training schemes to retain and keep training their apprentices is critical for continuity. The last thing we want to see is apprentices and trainees having to be let go when we need really them.”

New Zealanders of all ages could receive trades training, Hipkins said.

File photo of the Transmission Gully roading project.

The package will include $334m for additional tertiary education enrolments, $141m to support tertiary and trades education and $32m to meet demand in trades academies.

Hipkins said industry skills leadership would be vital to address the profound impact of Covid-19 on the labour market and education systems, so Workforce Development Councils and Regional Skills Leadership groups will get $276m.

The intention was to establish the councils in the second half of 2020, he said. A new $26m online careers advice system will also be set up.

“It will help all New Zealanders to understand their transferrable skills and will be particularly valuable for those who can’t easily show a clear work history,” Hipkins said.

In order to respond to the labour market needs post Covid-19, 15 Regional Skills Leadership Groups will be established.

The groups will be tasked with providing on-the-ground intelligence about regional labour market disruption and highlight particular areas within the community that need particular focus.

MSD SUPPORT

The Budget has allocated a further $400m for the Ministry of Social Development to get people into work. With the increased pressure of that, it will get $250m to help employ more frontline staff.

Social Development Minister Carmel Sepuloni said an additional $150m would also be invested in expanding MSD’s employment support services. This would allow MSD to respond to increased demand, including providing some services to people before they enter the benefit system, she said.

Other areas that would be funded included $12.5m towards strengthening employment services for disabled people, $12.1m towards services for those on remand and recently released offenders and $59.6m towards expanding Skills for Industry’s pre-employment and in-work training that would support the Government’s Construction Accord.

PRIMARY SECTOR JOBS

Agriculture Minister Damien O’Connor said $19.3m would be spent over four years in a range of initiatives to help thousands of recently unemployed New Zealanders access training and work opportunities in the primary sector.

The primary sector would need about 50,000 more people in a post-Covid-19 world, he said.

In the immediate term, the initiative aimed to place about 10,000 people in primary sector jobs by rapidly retraining and absorbing workers displaced from other sectors like hospitality and aviation.

There was no shortage of international demand for New Zealand food and fibre, so farmers, growers and producers would play a critical role in the economic recovery, he said.

Part of the funding would go into working with industry on familiarisation courses that help new workers know what to expect from life on a farm, and to provide essential skills to help workers settle into primary sector roles and lives,” O’Connor said.

MĀORI APPRENTICESHIPS

Funding of $50m will go towards support for Māori trades training.

“Māori community groups will partner with the Crown to establish and design group training schemes that employ Māori as apprentices and support the placement of apprentices across a range of workplaces. It will work by providing tailored support for Māori employers to take on Māori apprentices,” O'Connor said.

YOUTH EMPLOYMENT

A youth employment initiative, for at-risk youth in the regions will get a $121m boost.

He Poutama Rangatahi helps connect young people to real jobs identified by employers and the funding is aimed at giving it a more sustained footing in the regions, and speed up its establishment in urban areas like west and south Auckland, Hamilton, Porirua and east Christchurch.

Employment Minister Willie Jackson said: “We know this programme works and gets people into work.

“Expanding He Poutama Rangatahi will play a key role in kickstarting the recovery by helping people on the margins of the labour market get entry requirements for training and be supported to stay in training and employment,” he said.