BILLS DIGEST NO. 84, 2013–14              16 June 2014

Australian Workforce and Productivity Agency Repeal Bill 2014

Carol Ey
Social Policy Section 

Date introduced: 4 June 2014

House:  House of Representatives

Portfolio: Industry

Commencement:  Sections 1 to 3 commence on Royal Assent, Schedule 1 commences on the later of 30 June 2014 and Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website at http://www.comlaw.gov.au/.

Purpose of the Bill

The purpose of the Australian Workforce and Productivity Agency Repeal Bill 2014 (the Bill) is to repeal the Australian Workforce and Productivity Agency Act 2008[1] (the Act) and hence abolish the Australian Workforce and Productivity Agency (AWPA).

Background

Skills Australia was established in the early days of the Rudd Labor Government to provide independent expert advice and recommendations to Government about Australia’s skill needs.[2] In 2012, Skills Australia was renamed the Australian Workforce and Productivity Agency (AWPA) and its role and functions significantly expanded.[3] These additional functions included developing sectoral workforce development plans, undertaking research and analysis and having responsibility for administering the National Workforce Development Fund, which was worth $558.5 million over four years.[4]

The current AWPA Board has ten members drawn from across academia, training providers, industry and employee representatives and is supported by some 50 staff in the Agency.[5] The Agency maintains the Skilled Occupations List, which is used for skilled migration assessments, and also produces widely used reports into workforce sectors.[6]

Phase two of the National Commission of Audit report recommended that AWPA be consolidated into the Department of Industry, as part of its overall recommendation of reducing the number of separate agencies and boards.[7] In addition, it was announced in the 2014–15 Budget that the National Workforce Development Fund will cease from 1 January 2015, which would reduce the decision-making functions of AWPA.[8] This Bill seeks to implement the Commission of Audit’s recommendations through abolishing the AWPA Board and absorbing the Agency’s staff and remaining functions into the Department.

Committee consideration

At the time of writing this Bills Digest, the Bill has not been referred to any committees.

Policy position of non-government parties/independents

The creation of Skills Australia, the predecessor to AWPA, was one of the first acts of the Rudd Government, and the 2011–12 Budget expansion of the role with the creation of AWPA signalled ongoing support from Labor for a body providing independent advice to Government on skills and workforce development needs.

In relation to the proposed abolition of AWPA, Shadow Minister for Vocational Education and Training, Sharon Bird, said ‘…AWPA brings together the peak national bodies such as ACCI, AiGroup and the ACTU to achieve industry leadership. Disbanding the key national policy and research body on skills while we have jobs being lost across the country is nonsensical’.[9]

Neither the Australian Greens nor the independents have publicly commented on this proposal.

Financial implications

There are expected to be some limited savings resulting from the abolition of the AWPA Board but these are not quantified.[10]

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill's compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act.[11] The Government considers that the Bill is compatible.

Failure to pass

AWPA staffing is currently provided by the Secretary of the Department of Industry, and funding for the Agency is appropriated to the Department.[12] Therefore the only budgetary impact of failure to pass this Bill will be that funding for 2014–15 has not been provided to the Department for the costs of the AWPA Board. As noted above, these costs are not substantial.

Key issues and provisions

The only substantive provision in the Bill is item 1 in Schedule 1 which proposes the repeal of the Act. This would abolish the AWPA Board, thus removing its power and functions to provide independent advice to the Government on skills and workforce development issues. It is intended that the research and analysis functions currently undertaken by AWPA will be absorbed into the Department of Industry.

The key issue is whether removing this source of independent industry advice will diminish the Government’s capacity to respond to emerging skills issues. There appears to be have been little public commentary on the value of having an independent board providing this advice, although there was some support from the business community when the establishment of Skills Australia was first proposed.[13] However there has not been any response from interested groups to the decision to abolish AWPA, which may suggest that little value is placed on this role.

On the other hand, the research and analysis functions of the Agency appear to be well regarded, with one commentator noting that AWPA’s manufacturing report provided ‘the sort of measured work we need.’[14] It remains to be seen whether incorporation of the staff undertaking this analysis into the broader department will impact on this work.

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[1].              Australian Workforce and Productivity Agency Act 2008, accessed 13 June 2014.

[2].              For more information see: C Kempner, Skills Australia Bill 2008, Bills digest, 63, 2007–08, Parliamentary Library, Canberra, 2008, accessed 11 June 2014.

[3].              For more information see: L Doyle, Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012, Bills digest, 128,
2011–12, Parliamentary Library, Canberra, 2012, accessed 11 June 2014.

[4].              Australian Government, ‘Part 2: expense measures’, Budget measures: budget paper no. 2: 2011–12, pp. 146–7, accessed 13 June 2014.

[5].              Australian Workforce and Productivity Agency (AWPA), Annual report 2012–13, AWPA, Canberra, 2013, pp. 9–12, accessed 11 June 2014.

[6].              See, for example: J Ross, ‘Hi-tech cure for manufacturing’, The Australian, 8 April 2014, p. 21, accessed 11 June 2014 and A Macdonald-Smith, ‘Energy skills shortage puts billions at risk’, The Australian Financial Review, 17 December 2013, p. 10, accessed 11 June 2014.

[7].              National Commission of Audit, Towards responsible government: phase two, March 2014, Annexure B, p. 137, accessed 11 June 2014.

[8].              Australian Government, ‘Part 2: expense measures’, Budget measures: budget paper no. 2: 2014–15, p. 168, accessed 11 June 2014.

[9].              S Bird (Shadow Minister for Vocational Education and Training), Government axes skills advisory board by stealth, media release, 11 April 2014, accessed 12 June 2014.

[10].              Explanatory Memorandum, Australian Workforce and Productivity Agency Repeal Bill 2014, p. 1, accessed 13 June 2014.

[11].              The Statement of Compatibility with Human Rights can be found at page 2 of the Explanatory Memorandum to the Bill.

[12].              AWPA, op. cit., p. 39.

[13].              S Ryan, ‘Employers back Labor's new national skills body’, The Australian, 17 September 2007, p. 5, accessed 12 June 2014.

[14].              J Ross, ‘Coalition too hasty on “inconsistent” HECS reforms’, The Australian, 4 June 2014, p. 33, accessed 12 June 2014.