The federal government’s quiet decision to slash apprenticeship incentives is not just a budget tweak; it’s a blow to the very trades that keep Australia running. By halving support payments for apprentices and employers across hundreds of priority occupations from January 2026, the government risks crippling sectors already battling critical skill shortages.
At the very moment we need more hands, more talent, and more investment – especially in automotive, hospitality and retail – Canberra has chosen to pull support from the next generation of essential workers.
And just like that, the federal government quietly pulled the fast one, slashing the incentives for apprentices and their employers across hundreds of traditional trades.
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Article ID: 328536
We are at a critical juncture. The Australian government’s decision to halve the Australian Apprentice Training Support Payment (AATSP) for apprentices in most priority occupations from January 1, 2026, is deeply concerning, especially for sectors like automotive, hospitality, and retail. While incentives in housing construction and clean energy will continue, from January 2026, for those in our vital industries, the incentive will be cut in half from $5,000 to $2,500 for both employers and apprentices.
This reduction comes at a time when we desperately need more skilled workers to fuel the future of mobility, particularly as Australia accelerates its shift toward electric vehicles (EVs). By 2030, we must train over 21,000 EV specialists to meet the demands of electrification and ensure our automotive industry remains competitive and innovative.
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Apprenticeship programs are the backbone of developing skilled technicians essential to this transition. Cutting back support threatens to undermine our capacity to attract young talent, train the next generation of technicians, and ultimately, drive Australia’s automotive future forward.
We must prioritise and invest in our apprenticeships now, because without a strong, skilled workforce, our vision of cleaner, smarter mobility will be out of reach.
Slashing funds to key industries like automotive and hospitality may not actually inspire young people to enter those sectors and can, in fact, do more harm than good. When apprenticeship incentives are reduced, it puts at risk those apprenticeships that come with higher costs, those that require significant investment before completion.
While incentives often boost the number of starts, they rarely improve completion rates. This is because many of these programs attract lower-quality apprenticeships, and the underlying issues, such as insufficient training support or mismatched employer-apprentice relationships, remain unaddressed.
Cutting these funds could undermine the very system designed to develop skilled workers and sustain our trades.
I call on our local and federal politicians to stand up with employers like me and stand up for our trades and future workforce.
It’s crucial that we advocate for the reversal of these funding cuts and meet with industry stakeholders to find solutions that truly support apprenticeships and sector growth. Our trades, economy, and communities depend on your leadership.
Every trade has its value; no one trade is better than another, they all build the foundation of our communities and economy.
