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The Government is investing $230 million in trades training programmes it says will support 38,000 people into work.
The funding is expected provide 38,000 apprenticeship support places, although 14,000 of those would arrive after August 5 when a lower first-year subsidy of $500 a month will kick in.
The second-year subsidy rate would remain at the current $500 a month until the initiative ends in December 2023.
Education Minister Chris Hipkins and Social Development and Employment Minister Carmel Sepuloni made the pre-Budget announcement today at the post-Cabinet press conference, which they said would assist with the country's economic recovery after Covid.
Hipkins said the 3.2 per cent unemployment and economic activity were among the strongest in the world, thanks in part to investments in training programmes such as Apprenticeship Boost - a payment to employers taking on new apprentices.
"Over the past two years, over 190,000 people have benefitted from government investment in trades training, including apprenticeships," he said.
Apprenticeship Boost started in August 2020. Hipkins said it had helped increase the number of apprentices since the start of the pandemic by 55 per cent.
"We're also succeeding at getting more women into the trades."
Hipkins said businesses were calling for more skilled workers.
A $230 million investment as part of Budget 2022 would support another 24,000 apprentices getting Apprenticeship Boost support and 14,000 to keep being supported beyond August this year, he said.
There are already 17,000 employers involved in the programme and today's investment means new employers can join up, he said.
Under the scheme the first-year subsidy rate will lower from $1000 to $500 per month from August 5. The second-year subsidy rate will remain at $500 per month until the initiative ends in December 2023.
Hipkins said more work was to be done with apprenticeships, but good progress had been made. He congratulated new apprentices and thanked employers for taking them on.
Hipkins said the building and construction sectors had suffered major skill shortages.
"Ultimately, we made the decision to extend the subsidy."
He said the Government was confident a strong number of new apprentices could be sustained.
"Never say never," Hipkins said when asked if the scheme might extend beyond 2023.
Included in today's announcement is more support for Mana in Mahi and Māori Trades Training, which has assisted over 4719 young people into work and training, Sepuloni said.
Budget 2022 would see funding for 1600 places on the scheme over the next two years so that it can continue to train people for available employment opportunities.
Funding is also being extended for Māori Trades Training and the Ministry of Social Development has established partnerships with 17 Māori entities delivering unique multi-year work-focused training, she said.
"The training programme is beginning to bear fruit and today's announcement provides certainty to our providers and the rangitahi who are benefiting from the scheme.
"New Zealand is seeing a huge boom in construction and building and we have plenty of people willing and ready to take up the opportunities it provides. However, many lack the foundational skills to realise their potential."
Deputy Prime Minister Grant Robertson also appeared at the post-Cabinet news conference as with Prime Minister Jacinda Ardern is isolating after her partner Clarke Gayford tested positive for Covid-19.
Robertson said New Zealand had a very strong economy, with low unemployment, and boosting apprenticeships was important at this point in the country's economic development.
He said it was important not to end up in a situation akin to that which befell New Zealand after the Global Financial Crisis.
Robertson said labour shortages followed, and only "skyrocketing immigration" could address that at the time.
The deputy prime minister said today's announcements were about ensuring youth could upskill.
The Prime Minister was isolating rather than using the exemption scheme for critical workers for two reasons: their daughter Neve and because she is not technically considered a critical worker.
While Ardern has had to cancel some events - including a visit to Hawkes' Bay - she could do most events and meetings remotely, including chairing Cabinet, delivering a pre-Budget speech to Business NZ on Wednesday and taking part in Question Time and speeches in Parliament.
The ministers are also likely to face questions over the Government's approach to crime amid a wave of youth ram raids, the climate change emissions budgets announced this morning, and the new BA.5 Covid-19 variant that was found in the country yesterday.
This morning the Act Party released its "alternative budget" where it proposed a range of cuts to public spending.
Shortly after, National Party deputy leader and finance spokeswoman Nicola Willis delivered a speech outlining her party's approach, focusing on the "squeezed middle".
The Budget is to be delivered May 19, with a focus on climate change and health.