Purpose of the bills
1.1
The Jobs and Skills Australia Bill 2022 seeks to establish a new agency, Jobs and Skills Australia (JSA), as a statutory body within the Department of Employment and Workplace Relations (department) while consultation occurs on a permanent model for the agency.
1.2
The main functions of the new JSA agency would be to:
advise the Minister and Secretary of the department on Australia's labour market and its skills and training needs and priorities; and
report on Australia's labour market and its workforce skills and training needs and priorities to assist government policy development and program delivery.
1.3
At the same time, the Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022 would abolish the role of the existing National Skills Commissioner by repealing the National Skills Commissioner Act 2020.
Background
Context of the bills
1.4
In his second reading speech, the Minister for Skills and Training, the Hon. Brendan O'Connor MP (minister), identified skills and labour shortages as a major challenge facing Australian employers across a range of sectors, particularly in the wake of the COVID-19 pandemic. The minister stated that 'the number of businesses unable to fill job vacancies is growing and is expected to dampen economic growth'.
1.5
This reflects a combination of both short-term labour shortages (mostly at lower skills levels), as well as more persistent shortages of highly skilled workers, including in technical and trade-based occupations.
1.6
In addition to workforce shortages, skill needs within occupations are changing, with a growing need for digital skills, non-routine cognitive skills and communication and collaboration abilities.
1.7
In response to these challenges, Minister O'Connor stated that the proposed JSA agency would:
… have an important role in strengthening Australia's economy by providing crucial workforce planning functions. It will undertake the workforce forecasting and prepare capacity studies for new and emerging industries and contribute to the planning for a pipeline of skilled workers.
Two-stage approach to establishing JSA
1.8
The Jobs and Skills Australia Bill 2022 represents the first stage in establishing JSA. This includes setting out JSA's initial structure and functions, as well as creating the position of interim JSA Director to lead the agency through its establishment phase.
1.9
The Explanatory Memorandum (EM) notes that in this first stage, JSA would be created as a statutory body within the department. This would allow JSA to begin work while further consultation occurs—including as part of the September 2022 Jobs and Skills Summit—on a permanent model for the agency. Following the consultation period, it is expected that a new bill would be introduced to establish JSA's permanent functions, structure and governance arrangements.
Abolition of the National Skills Commission
1.10
Operating in parallel with the Jobs and Skills Australia Bill 2022, the Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022 would abolish the role of the existing National Skills Commissioner.
1.11
The National Skills Commission (NSC) was established on 1 July 2020 under the National Skills Commissioner Act 2020. The NSC is led by the National Skills Commissioner, Mr Adam Boyton.
1.12
Currently, the NSC's role is to provide expert advice and national leadership on the Australian labour market and current, emerging and future workforce skills needs. It also plays a role in simplifying and strengthening Australia's vocational education and training system.
1.13
The minister has stated that JSA would build on the work of the NSC but would have 'a broader remit to address issues in the skills and training sector'. This broader remit would include working in partnership with industry and other stakeholders as well as a proactive role in workforce planning.
Key provisions of the Jobs and Skills Australia Bill 2022
1.14
The key provisions of the Jobs and Skills Australia Bill 2022 are contained in proposed Parts 2–5 which detail:
the establishment and functions of JSA (Part 2);
the establishment and functions of the JSA Director and staff (Part 3);
administrative arrangements relating to the JSA Director (Part 4); and
a number of miscellaneous provisions (Part 5).
Part 2 – establishment and functions of JSA
1.15
Proposed clause 7 provides that JSA would consist of the JSA Director and staff assisting. For the purposes of the Public Governance, Performance and Accountability Act 2013, the JSA Director and staff would be departmental officials and the Secretary of the department would be the accountable authority for JSA expenditure.
1.16
In accordance with proposed clause 9, JSA would be responsible for advising the Minister and Secretary on:
the current and emerging labour market, including workforce needs and priorities;
current, emerging and future skills and training needs and priorities, including apprenticeships; and
the adequacy of the vocational education and training (VET) system, including training outcomes.
1.17
In addition, JSA would be required to:
prepare capacity studies, including for emerging and growing industries/occupations,
this may include analysis of factors impacting worker supply and demand in particular sectors, gap analysis of in-demand skills, and consideration of when workers will be needed in the future;
undertake workforce forecasting and cross-industry workforce analysis, and assess workforce skills requirements,
this may include systematic identification, analysis and planning of future workforce needs to support industry and economic growth; and
undertake research and analysis on resourcing and funding requirements for registered training organisations (RTOs) to deliver accessible quality VET courses,
this would include considering costs from the perspective of both RTOs and students.
1.18
JSA would also be responsible for informing the public about the matters above, as well as for collecting, analysing, sharing and publishing data and information to inform policy development and program delivery.
Performance of functions – required consultation
1.19
Proposed clause 10 would require JSA, where appropriate, to consult and work with:
state and territory governments, plus relevant authorities of state and territory governments; and
employers, unions, training providers and other industry stakeholders, and other persons or bodies with an interest in the labour market, workforce skills or workforce training needs.
1.20
This clause would give effect to the Australian Government's commitment to tripartism by requiring JSA to build and maintain genuine working relationships with relevant stakeholders as it performs its functions.
Part 3 – establishment and functions of JSA Director and staff assisting
1.21
Proposed clause 12 would establish the office of the JSA Director. Proposed clause 13 provides that the functions of the JSA Director would be to:
assist JSA to perform its functions;
undertake other functions that may be conferred by the rules, JSA's establishing act, or any other Commonwealth law; and
do anything incidental or conducive to the performance of the above functions.
1.22
Under proposed clause 14, staff assisting the JSA Director would be made available by the Secretary of the department and would be subject to the directions of the JSA Director. In addition, proposed clause 15 would allow other Commonwealth agencies to make staff available to assist the JSA Director, while proposed clause 16 would allow the JSA Director to engage consultants.
Part 4 – administrative arrangements relating to the JSA Director
1.23
Part 4 would establish administrative arrangements relating to the office of the JSA Director, including appointments, remuneration, leave of absence, engaging in other paid work, resignation and termination. In addition, under proposed clause 23, the Minister would be able to determine any terms and conditions relating to matters not covered by the bill.
Appointments
1.24
Under proposed clause 18, the JSA Director would be appointed by the Minister on either a part-time or full-time basis for a term not exceeding one year (noting that section 33AA of the Acts Interpretation Act 1901 would allow for the JSA Director to be reappointed). The EM states that this appointment period reflects the interim nature of the arrangement in light of the proposed development of a permanent model for the agency.
1.25
Proposed clause 19 allows for an acting JSA Director to be appointed in certain circumstances. The EM notes the proposal to use this provision to appoint an interim JSA Director while consultations on a permanent model for the agency are undertaken.
Remuneration
1.26
Under proposed clause 20, the JSA Director would be paid the remuneration determined by the Remuneration Tribunal or, if no determination exists, the remuneration prescribed by the rules. Allowances to be paid to the JSA Director would be prescribed by the rules.
Leave of absence
1.27
Proposed subclause 21(1) would provide for a part-time JSA Director to be granted leave of absence on terms and conditions considered appropriate by the Minister.
1.28
Under subclause 21(2), a full-time appointee would have the recreation leave entitlements determined by the Remuneration Tribunal. The Minister would be able to grant other leave of absence on terms and conditions determined by the Minister.
Engaging in other paid work
1.29
Proposed subclause 22(1) would prevent a part-time JSA Director from engaging in paid work the Minister views as conflicting, or potentially conflicting, with the performance of the JSA Director's functions.
Proposed subclause 22(2) would prevent a full-time appointee from engaging in other paid work without the Minister's approval.
Resignation and termination
1.30
Proposed clause 24 would allow the JSA Director to resign by providing written notice to the Minister.
1.31
Under proposed Clause 25, the Minister would be able to terminate the JSA Director's appointment for a range of reasons, including misbehaviour, an inability to perform because of physical or mental incapacity, bankruptcy, being absent for 14 consecutive days or 28 days in any 12 months (other than as a result of leave of absence), engaging in paid work in contravention of proposed clause 22, or a failure to comply with the requirement to disclose interests.
Part 5 – miscellaneous provisions
1.32
Part 5 of the bill deals with miscellaneous provisions such as Ministerial directions, annual reports, delegations and the rule-making power.
Ministerial directions
1.33
Proposed subclause 27(1) would permit the Minister to direct the way in which the JSA Director carries out their functions or those of JSA.
However, proposed subclause 27(2) would operate to prevent the Minister from directing the content of any advice provided by the JSA Director or JSA.
Delegation
1.34
Proposed Subclause 29(1) would allow the Minister to delegate their powers to the Secretary of the department or an SES employee of the department. Proposed subclause 29(2) would permit the JSA Director to delegate their functions or powers to an SES employee of the department.
Rules
1.35
Under proposed clause 30, the Minister would be able, by legislative instrument, to make rules prescribing matters that are required or permitted by the bill to be prescribed, or are necessary or convenient to be prescribed to carry out or give effect to the bill.
Financial implications
1.36
The EM notes that the Jobs and Skills Australia Bill 2022 and Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022 would have no financial impact. JSA would be funded from savings realised by abolishing the role of the National Skills Commissioner.
Consideration by other parliamentary committees
1.37
When examining a bill, the committee considers any relevant comments published by the Senate Standing Committee for the Scrutiny of Bills and the Parliamentary Joint Committee on Human Rights. At the time of writing, neither committee had reported on the Jobs and Skills Australia Bill 2022 or the Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022.
1.38
The committee notes the EM's statement on compatibility with human rights, which concludes that the Jobs and Skills Australia Bill 2022 is compatible with human rights because it promotes the protection of human rights and does not limit any human rights. It also notes that the Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022 does not engage any applicable rights or freedoms.
Conduct of the inquiry
1.39
On 28 July 2022, the Senate referred the provisions of the Jobs and Skills Australia Bill 2022 and Jobs and Skills Australia (National Skills Commissioner Repeal) Bill 2022 to the committee for inquiry and report by 23 September 2022.
1.40
The committee advertised the inquiry on its website and invited submissions by 19 August 2022. The committee received 55 submissions, listed at Appendix 1 of this report.
1.41
The committee also held a public hearing in Canberra on 23 August 2022. A list of witnesses who gave evidence at that hearing is included at Appendix 2.
Acknowledgement
1.42
The committee thanks those individuals and organisations who contributed to this inquiry by preparing written submissions and giving evidence at the public hearing.