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Apprenticeship Boost’ Subsidy Protects Most Vulnerable Workers Says Industry Training Leader

The CEO of industry training organisation (ITO) Competenz, Fiona Kingsford, says her organisation is delighted to see today’s Government announcement of up to $16,000 going to employers to help pay the costs of all apprentices for the first two years.

“This apprentice wage subsidy will provide relief for our employers and protects the jobs of workers in the early stages of their apprenticeships, who are often the most vulnerable. It will also allow businesses to take on new apprentices to help combat an ongoing skills shortage and post-COVID unemployment,” says Ms Kingsford.

“Coupled with the Government’s free apprenticeship and targeted traineeship training fund announced on 02 June, this shows a real commitment to getting New Zealand industry training back on track to lead our post-COVID economic recovery.”

In his announcement, Education Minister Chris Hipkins also said the Government wanted to help employers keep their apprentices on and give them confidence to take on new apprentices, particularly as they fast track new infrastructure projects.

“Without support of this kind after the Global Financial Crisis, apprentices were let go

and when the economy picked up, New Zealand struggled with huge skills shortages

and had to pay more to find skilled people from overseas,” said Minister Hipkins.

Across the 37 sectors Competenz represents, including engineering, manufacturing, food processing and forestry, employers will be able to access the subsidy for nearly 3,000 apprentices.

From August 2020 to April 2022, employers can apply for funding of up to $12,000 per apprentice in their first 12 months of training, and up to $6,000 in their second 12 months.

Ms Kingsford is also pleased to see this support will reach those who need to retrain in a new industry due to COVID-19, and school leavers who may be facing an uncertain future in the job market.

“There will be a swathe of school leavers entering the job market at the end of this year and they have just been given a real boost. An apprentice wage subsidy enables more young people to undertake on-the-job training, get paid and gain nationally recognised qualifications, providing tangible opportunities that may not have been available otherwise,” says Ms Kingsford.

“We also see the other end of the scale in our industries, with people in their 30s and 40s successfully taking on an apprenticeship to retrain in a new industry, which is clearly relevant in the situation we now find ourselves in.”

The Government has budgeted $380.6 million for the ‘Apprenticeship Boost’ scheme which was announced on Budget Day.

The Ministry for Social Development will be responsible for administering the scheme.

Competenz urges employers who wish to access this apprentice wage subsidy to call 0800 526 1800 or email info@competenz.org.nz

For official government information the Apprenticeship Boost scheme go to:

Work and income website

Tertiary Education Commission website

Q+A for Apprentice Boost

How much do employers receive for having an apprentice?

The initiative runs for 20 months, and an employer could get a maximum of $16,000 for an apprentice who is starting their training (12 months at the first year rate, and 8 months at the second year rate). Employers will receive $12,000 per full year of training for each first year apprentice, and $6,000 per full year of training for each second year apprentices. They may receive less than the full year amount depending on where in their training each apprentice is. For example, if a first year apprentice is already 9 months into their training, they will receive 3 month’s support at the $12,000 per year rate (i.e. $3,000) before shifting to the second year rate of $6,000 per full year of study.

How is an employer eligible?

An employer will be able to receive this support if they employ an eligible apprentice (i.e. one that is enrolled in a Level 4 New Zealand or Managed Apprenticeship programme, and is in the first or second year of this apprenticeship).

Will there be priority industries that are eligible?

No. There are no priority industries for this support; this is available to apprentices in all industries.

How will the funding be used?

This support is a wage subsidy paid to the employer per eligible apprentice. The employer is required (by law) to continue to pay the apprentice at least the minimum wage or training wage. The employer will therefore top up this subsidy amount and continue to pay the apprentice the wage they are legally entitled to.

Is it for new apprentices only?

No. The Apprentice Boost is available for all new and existing apprentices, if they are eligible.

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