T

Submission to Hon Steven Joyce:

Expert review of Australia's vocational education and training system

25 January 2019

Page | 2

NFF Member Organisations

Page | 3

The National Farmers’ Federation (NFF) is the voice of Australian farmers.

The NFF was established in 1979 as the national peak body representing farmers

and more broadly, agriculture across Australia. The NFF’s membership comprises

all of Australia’s major agricultural commodities across the breadth and the length

of the supply chain.

Operating under a federated structure, individual farmers join their respective state

farm organisation and/or national commodity council. These organisations form the

NFF.

The NFF represents Australian agriculture on national and foreign policy issues

including workplace relations, trade and natural resource management. Our

members complement this work through the delivery of direct 'grass roots' member

services as well as state-based policy and commodity-specific interests.

Page | 4

Statistics on Australian Agriculture

Australian agriculture makes an important contribution to Australia’s social,

economic and environmental fabric.

Social

There are approximately 88,073 farm businesses in Australia, over 99 per cent of

which are Australian family owned and operated.

Each Australian farmer produces enough food to feed 600 people, 150 at home and

450 overseas. Australian farms produce around 93 per cent of the total volume of

food consumed in Australia.

Economic

The gross value of Australian agriculture (excluding fisheries) in 2016 - 17 was

$61.7 billion, with around 80 percent driven by exports.

Together with vital value-adding processes for food and fibre after it leaves the farm,

along with the value of farm input activities, agriculture’s contribution to GDP

averages out at around 12 per cent (over $155 billion).

Workplace

The agriculture, forestry and fishing sector employs approximately 323,000

employees. Across the supply chain, agriculture powers around 1.6 million jobs.

Seasonal conditions affect the sector’s capacity to employ. Permanent employment

is the main form of employment in the sector, but more than 26 per cent of the

employed workforce is casual.

In the vegetable and horticulture industries, most farm employees are seasonal

workers and most of these employees are working in Australia on a visa. In contrast,

the cotton industry has more full-time employees, and those workers classified as

seasonal are generally Australian or New Zealand residents.

Environmental

Australian farmers are environmental stewards, owning, managing and caring for

51 per cent of Australia’s land mass. Farmers are at the frontline of delivering

environmental outcomes on behalf of the Australian community, with 7.4 million

hectares of agricultural land set aside by Australian farmers purely for conservation

and protection purposes.

Page | 5

Contents

Statistics on Australian Agriculture ................................................................. 4

Introduction ...................................................................................................... 6

The Agricultural Workforce ............................................................................ 7

The Farm Workforce — Skills & Training...................................................... 8

1. Farms value practical experience, with some short course learning ............. 8

2. Farms requires multi-skilled workers ......................................................... 10

3. Existing funding models result in inconsistencies across jurisdictions ...... 11

4. Trainee farmworkers face unique challenges ............................................. 12

5. Mid-career workers are not well served by the current VET model ........... 12

6. The VET Sector is a valued part of the Australian skills landscape ........... 13

7. This review should be mindful of the numerous prior reviews .................. 14

Page | 6

Introduction

The National Farmers’ Federation’s (NFF’s) vision for Australian agriculture is to

become a $100 billion industry by 2030. The Agricultural sector is already a

source of strength in the Australian economy, positioned to capitalise on growing

global demand for safe, high quality food and fibre over the coming decades.

Nonetheless, to achieve our vision, the sector needs public policy settings that

foster growth, productivity, innovation, and ambition. Realistic and pragmatic

measures to grow the agricultural labour force and enable access to capable and

workers will be a central component of these policy settings. A reliable workforce

is critical to the continuity and growth of Australian farms, and labour shortages

jeopardise the future of some farms and prevent the expansion of others. In either

case, there are substantial costs to the Australian agriculture sector and the

Australian economy more broadly. While a general shortage of workers will limit

the productivity of Australian farms, a lack of skilled workers will stifle the

industry’s ability to innovate and adapt to change. Both have implications for the

future of Australian agriculture.

In short, the NFF 2030 vision requires continued growth of the sector, and without

access to labour this growth may not occur.

The NFF welcomes the opportunity to provide input to the Hon. Steven Joyce in

respect of his expert review of Australia's vocational education and training

system.

Page | 7

The Agricultural Workforce

The Australian agriculture industry’s future depends on attracting, training and

retaining the next generation of farmers and farm workers. However, the needs of

the farming sector may be different to those of other industries. Indeed, some of

the defining features of farms pose challenges which make their workforces and

labour needs unique.

Some of those challenges include:

• A relatively high level of seasonal, casual and contract labour (including

harvest labour);

• A wide geographical spread, with much of the work occurring in remote and

rural areas;

• Frequent requirements for employees to work extended and/or unsociable

hours;

• Narrow margins and a “price taking” reality, where the value of the farm

produce is effectively determined by a “duopoly” of supermarkets;

• An ageing labour force; the median age of a farm worker’s age is 49

compared to the national average of 40;

• Lower level of literacy and numeracy across a number of occupation groups

and industry subsectors;

• A range of ownership structures, including owner operators, family business

models, sovereign wealth funds and multinationals; and

• A high concentration of small and medium sized enterprises.

These factors were recognised by the Agriculture Competitiveness White Paper,

where it is said that:

To meet projected demand and exploit market opportunities, the agriculture sector

needs both skilled farmers and a skilled and available workforce. However,

agriculture has struggled to attract and retain the skilled labour it needs to

prosper. This was particularly so when the mining industry was booming. Other

factors contributing to this have been declining rural populations as people have

moved to larger towns and cities, outdated perceptions of agricultural career

paths, and relatively low rates of participation in agriculture-related education.1

While the industry invests heavily in programs to recruit, train and retain skilled

workers within Australia,2 in combination these factors mean that finding and

retaining a reliable work force is a significant challenge and contributes to serious

1 Commonwealth of Australia, 2015, Agricultural Competitiveness White Paper.

2 See National Farmers Federation, December 2018, A Greener Future.

Page | 8

labour shortages for the sector. Precise figures remain elusive, but the size and

significance of the shortage is well documented. Studies indicate that more than

60% of growers in the fruit and veg sector experience difficulty recruiting and, as

a consequence, have left produce unpicked.3 While the dairy sector reports that

labour challenges cost it up to $364 million each year4. Indeed, case studies

suggest aggregate losses of individual farm businesses can range into the hundreds

of thousands — occasionally even millions — of dollars. The costs escalate when

the impact on future productivity of farms, the broader supply chain, and the flow-

on effect to agricultural communities is taken into account.

The Farm Workforce — Skills & Training

1. Farms value practical experience, with some short course learning

Statistics indicate that the majority of people employed in the agriculture, forestry

and fishing industries have relatively low levels of educational attainment: 64% of

the workforce having achieved a qualification no higher than year 12 or

equivalent, compared with 42% across all industries. Less than 10% of farm

managers are degree qualified, compared to more than a quarter of Australian

managers overall.

Most workers in the agricultural sector acquire their skills through practice and on-

site learning, with the addition of some targeted short courses of study. For

example, while in 2011 more than a third of the top 20 employing occupations in

3 Howe et al & University of Adelaide (issuing body), Labour Challenges in the Australian Horticulture Industry, 2018

4 National Rural Advisory Council, Report on the workforce planning capabilities of agricultural employers, May 2013

Page | 9

agriculture were high-skilled occupations5, for the vast majority6 most of the

workers had no formal post-school qualifications. This is consistent with ABS

2016 census data, which indicates that just 5% of all students in course at the

Certificate III or higher7 were studying agriculture, environmental or related fields.

The low share of workers with higher levels of educational attainment may be

reflective of the long history of unofficial extension activities which farmers rely

on to share information and improve farm management and practices; from

informal conversations to community and field days. It may also be a product of

the remote location of workers and subsequent lack of access to formal education

and training opportunities, and the traditional family business structures found in

the industry. The prevalence of ‘word of mouth’ work opportunities and on-the-

job training are also likely to have contributed. Another obstacle is the difficulty in

getting enough people for a particular course at one time to enable RTO to cover

its costs.

Indeed, the statistics reflect the fact that within many sectors of the agricultural

industry, learning is typically incremental, socially embedded, and occurs over a

lifetime. Job pathways can be horizontal or tangential, and involve a ‘building

block’ approach to gaining a portfolio of skills which are fundamental to securing

and maintaining employment in rural Australia.

That said, this may also reflect (to greater or lesser degree) a lack of policy

attention on the training needs of agriculture. For example, the largest cohorts of

rural industry workers perform work at or around the Certificate II or III level. It

follows that these are the areas with the greatest training and skills needs.

Unfortunately, according to data available at www.training.gov.au a mere 5% of

accredited RTOs have lower level Certificate II and III Agriculture, Horticulture

and Conservation and Land Management qualifications on their delivery scope. 8

Furthermore, Commonwealth policy settings have placed a heavier emphasis on

higher level qualifications and VET fee loans to support and underpin them, while

neglecting traineeships and apprenticeships.

The consequence (at least in part) is that the sector must draw on a larger labour

market than Australia offers — that is, on migrant labour — particularly when it

comes to skilled roles. For example, in the pork industry, a recent survey by

Australian Pork Limited found that 69% of respondents reported staff vacancies at

1 July 2017, and 95% of respondents with overseas workers reported all or most

have formal qualification equivalent to Certificate III Agriculture (Pig Production)

5 That is, ANZSCO Skill Levels 1 to 3, requiring at least a Certificate III plus two years on the job training. The occupations were livestock farmers; crop farmers; mixed crop and livestock farmers; agricultural and forestry scientists; shearers; animal attendants and trainers; and agricultural technicians:

6 Five.

7 i.e. cert III, cert IV, diploma, degree, or post-graduate qualifications.

8 Around 227 out of approximately 5,000.

Page | 10

or higher. All respondents said that they thought that the subclass 457 visa

program9 had been successful in helping to address on-farm skills and labour

shortages.

In addition, this focus on higher level qualifications is out of step with the

perceptions of many individual rural industry employers and the sector’s wider

scepticism of the need and value of higher-level qualifications. Indeed, there has

been a recent decline in the commencement of traineeships and apprenticeships

which combine structured learning, both on and off the job, with paid employment

and the practical application of skills and knowledge. Approximately four out of

five VET students are completing qualifications without adequate industry

placement or exposure to hone and develop their skills and capacities. This trend

will further accentuate the level of disconnect between many VET outcomes and

the needs of agricultural industries and employers. As noted above, farmers are

hands-on, ‘pragmatic’ people with much farm ‘training’ occurring on the farm

through informal structures. The Ag VET system should be designed in a way

which identifies and addresses the disconnect been this aspect of farm cultural and

Ag VET practice.

In the NFF’s submission, most VET qualifications, and particularly those in the

agricultural sector, should not to be granted to participants who have not worked

within the relevant industries and are routinely demonstrating, on the job, the

required and specified competencies. The sector should stipulate an increased

requirement for industry work experience placements or paid employment as

necessary course components.

2. Farms requires multi-skilled workers

A variety of competencies are required of skilled (and unskilled) farm workers.

For example, a Skills and Labour Needs Review10 survey, conducted by AgForce

Queensland, identifies the diverse set of skills that are required of a worker in

broadacre cropping enterprises. Categorised broadly, the eleven skillsets which

farms required of their employees and contractors in order to run an efficient

business were:

• tractor & heavy machinery operation;

• animal safety and animal husbandry;

• welding, chainsaw, and workshop machinery operation;

• mechanical servicing and repairs;

• rural safety and OHS qualifications;

• horse and bike riding ability;

9 Subsequently replaced by the ‘temporary skills shortage’ visa programs.

10 AgForce Queensland, Skill and Labour Needs Review Analysis 2012 at pg 19.

Page | 11

• chemical/nutrition application;

• fencing;

• electronic recording (GPS, NLIS) and computer skills;

• integrated pest management; and

• conservation farming methods, clean energy and carbon farming.

The report concluded that:

The high percentages of skills required by permanent employees in particular and

in part time and casual employees and contractors in general, highlights the

complex nature of modern broadacre agriculture and emphasises the need for a

high standard of training in the basic skills listed above.

The needs for a broad/diverse skillset is not unique to broadacre cropping. For

example, the dairy labour agreement contains a lengthy list of duties for the senior

dairy worker which include (but are not limited to):

• coordinating and implementing reproductive programs,

• planning and managing pastures and crops,

• supervising animal health programs,

• supervising staff,

• operating milking plant and equipment,

• performing irrigation works,

• transporting, handling, preparing and applying chemicals;

• maintaining sheds, fences, fixtures and fittings;

• ensuring food safety regulatory requirements are met; and

• operating computer equipment

The key point is this: the labour need of the farming sector are diverse and

challenging and traditional forms of training and education do not always succeed

in creating the labour force which the sector requires.

3. Existing funding models result in inconsistencies across jurisdictions

The degree of government funding support for agricultural traineeships and

apprenticeships continues to vary significantly between Australian jurisdictions.

For example, the maximum fee for a trainee who is eligible for the subsidy to

study for an Cert II in Agriculture NSW TAFE in the Armidale campus is $1,340,

while the fees payable for studying the same course at WA’s North Regional

TAFE is $2,550, almost twice the cost. In addition, trainees, apprentices and

students are required to make varying levels of fee contributions.

Page | 12

These disparities result in inconsistent, inadequate or inappropriate funding

models and, consequentially, in:

(1) Significant variations in the quality of training outcomes; and

(2) Limited availability of many VET pathways and qualifications across

jurisdictions.

The National Agribusiness Education Skills and Labour Taskforce noted in June

2014 that:

A recent review of current funding levels across jurisdictions for indicative

Agricultural and Horticultural qualifications at the Certificate II, II, and IV level

through traineeship and apprenticeship pathways. It found a myriad of different

approaches and priorities — and in many cases questionable bureaucratic

determinations — in respect of the level of funding required to deliver training at

particular AQF levels. It also found considerable variation in the number and scope

of qualifications that attract State/Territory government support.

Historically the agriculture sector has had limited involvement in formal structured

education and training. Over many years it has been the “poor relation” with

respect to the level of training delivery expenditure both nationally and across the

states. The government incentive-support for employer and trainees/apprentices is

marginal in comparison to many other industries.

Furthermore, over the last twenty odd years the compliance costs for registered

training organisations have increased almost four-fold, diverting funding to

compliance activities and dramatically reducing the amount to funding applied to

support training delivery and assessment. Nevertheless, the heightened level of

regulation of the VET sector since the establishment of ASQA has not resulted in

any better alignment of VET outcome to industry or employer requirements.

4. Trainee farmworkers face unique challenges

In addition to the traditional problems involving Australian Apprenticeships

traineeships and apprenticeships in agriculture and related industries (particularly

in rural, regional and remote areas) routinely face unique challenges which result

in retention difficulties and poor completion rates. These challenges include:

limited or prescriptive training-provider choice; geographic isolation; limited peer

and service provider support; and inadequate or highly competitive labour

markets. In addition, many rural traineeship participants have to relocate to

remote areas, depriving them of their usual familial and peer support networks,

and are often called upon to travel long distances to complete their requisite off-

the-job training.

5. Mid-career workers are not well served by the current VET model

During the five year period 2013 to 2017, there was a significant fall in

participation rate in Australian Apprenticeships:

• The 19 years and under cohort by 9.7%;

Page | 13

• The 20 - 24 years cohort by 23.1 %;

• The 25 - 44 years cohort by 49.4%; and

• The 45 years and over cohort by 67.7%.

Although there are undoubtedly additional explanations, the progressively

dramatic fall off – particular from the 20 - 24 to the 25 - 44 years cohort — in

participation rates as the age of the cohort increases would strongly indicates a

lack of engagement with the older/midcareer workers.

This could be explained in large part by the rigid VET qualifications structures,

and a lack of incentive to encourage employers to up-skill their existing

workforce. The problem has been exacerbated by changes to Commonwealth

employer incentives over time; significantly, with the removal of universal access

to Certificate II employer incentives and existing worker Australian

Apprenticeship pathways. This has dampened employers’ appetite to “upskill”

their existing workforce. All have contributed to the creation of rigid and systemic

impediments that discourage or preclude the participation of many mid-career

workers and others looking to take-up employment opportunities in different, new

and/or emerging careers paths.

Unfortunately, the removal and phasing out by the Commonwealth of existing

worker Australian Apprenticeships pathways has further diminished the VET

system’s capacity to meet the needs of mid-career workers looking for upskilling

and retraining options, as well as impeding the ability of the system to meet the

needs of industries seeking the rapid deployment of new skills.

In addition, it should be noted that in many jurisdictions access to funding support

for Certificate II qualifications is restricted to persons between the ages of 16 - 24

years.11 Unfortunately, with less than 10% of the rural industry workforce being

drawn from that age group, it means most rural industry workers (who are aged 25

and over) are denied access to funding support, to undertake structured training to

acquire many of the practical hands-on skills required across many sectors.

6. The VET sector is a valued part of the Australian skills landscape

Our concerns notwithstanding, with over 4 million Australians enrolled and

undertaking VET qualifications it cannot be said that the VET sector lacks wider

community confidence or is considered ineffective by many of its users. The

National Centre for Vocational Education Research (NCVER) student satisfaction

survey results routinely indicate high level of satisfactions with the courses

completed even though many may not necessarily give rise to an employment

outcome or enhanced an individual’s employment and/or career progression

prospects.

11 Unless they are Indigenous, Torres Strait Islander or disabled

Page | 14

NFF member organisations are active participants at all levels of the ongoing

review and development of the national competency standards framework through

two Industry Reference Committees supported by Skills Impact. We are believe

that the processes they follow ensure national qualification reflect real work

activities, current skills standards and practice. These standards then underpin a

delivery system that, when operating effectively, can help provide a skilled and

flexible workforce for the future.

Nevertheless, there would undoubtedly be plenty of opportunities to strengthen

industry links with RTOs within the VET sector; and to also improve significantly

the quality and volume of information linking training options to employment

outcomes, as well as improve the accuracy and usefulness of information on VET

options particularly for employers and students who often struggle to find their

way through the complex information maze.

7. This review should be mindful of the numerous prior reviews

There have been several Reviews over the years that have examined skills,

knowledge and educational requirements in rural and related industries that have

involved varying degrees of industry and peak body/group input.

These include:

• National Agriculture Workforce Plan 2014 - NFF National Agribusiness

Education, Skills and Labour Taskforce;

• Food and Beverage Workforce Study 2013 Australian Workplace

Productivity Authority;

• 2012 Inquiry into Agricultural education and Training in Victoria -

Education and Training Committee Parliament of Victoria;

• 2013 Review into Agricultural Education and Training in New South Wales;

• 2012 Senate Education, Employment and Workplace Relations References

Committee – Higher education and skills training to support agriculture and

agribusiness in Australia;

• 2012 Rebuild the Agricultural Workforce Report Allen Consulting Group;

and

• Skills for Prosperity – A roadmap for vocational education and training

Skills Australia 2011.