Dris proposal for national licensing of the electrical occupations

Government objectives for reform

COAG has agreed to pursue wide-ranging regulatory reform to create a seamless national economy. This will enhance Australia’s longer-term growth, through reducing costs incurred by business in complying with unnecessary and inconsistent regulation across jurisdictions and improve workforce participation. A key part of achieving this objective is to address the deficiencies in the current approach to licensing in Australia by developing a National Occupational Licensing System (national licensing) for certain occupational areas. Under this reform, national licences would be issued by NOLA through delegated agencies in the states and territories. This would allow licensees to operate in all Australian jurisdictions, without having to apply for another licence or pay an additional fee. This would increase labour mobility and improve the efficiency of regulation.

The national licensing system will involve certain occupational and associated business licensing in the following initial occupational areas and is to be introduced in two waves:

• 
  first wave: electrical; plumbing and gasfitting; property; refrigeration and air-conditioning
  
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  second wave: building and building-related occupations; valuers and conveyancers.
  

COAG has agreed that, under national licensing, the first wave of licences will be settled by 2013, with the second-wave occupations to follow. National licensing would have the capacity to extend to other licensed occupations over time and provide a platform on which further harmonisation of state-based licensing arrangements, such as conduct requirements, could be considered.

The move to a national licensing system was initially agreed by COAG in the Intergovernmental Agreement signed in April 2009. Since then, arrangements for the national framework legislation (the National Law) have been implemented in most jurisdictions (New South Wales, Victoria, Queensland, South Australia, Tasmania and the Northern Territory) to establish the national licensing system.

Western Australia will consider its position on the passage of the Bill as a part of implementing national licensing arrangements. The Australian Capital Territory has reserved its right not to implement national licensing if the costs to the Territory outweigh the benefits.

A copy of the National Law can be found on the national licensing website at www.nola.gov.au.

The principles on which the work has been undertaken are based on COAG’s Principles of Best Practice Regulation² and incorporated in the Intergovernmental Agreement. These state that licensing arrangements should be effective and proportional to that required for consumer protection, and worker and public health and safety, while ensuring economic efficiency and equity of access.

Electrical occupations are important to the economy

The electrical services industry is the largest of the building and construction contracting trades, accounting for about one-seventh of the gross product, revenue and employment in the construction trade services sector. Industry activities span all building, infrastructure and industrial markets. Services provided include the installation of new electrical, electronic, communications and industrial equipment; the installation of wiring and cabling; and the repair and maintenance of existing electrical equipment and fixtures.³

An IBISWorld report from February 2012 anticipated that the industry would generate revenue totalling $11.5 billion in 2011–12, including value-added of $5.75 billion or about 0.5 per cent of Australia’s GDP.⁴ The industry comprises many small-scale operators employing four to five people per establishment on average, including working proprietors and partners.

Based on information provided by jurisdictional regulators, there are over 230,000 electrical licensees across Australia, as shown in Table ES.1. Approximately 72 per cent of licences are issued in New South Wales, Victoria and Queensland.

Table ES.: Number of existing electrical licensees per jurisdiction and nationally, as at March 2012

Number of electrical licensees	NSW	Vic	Qld	WA	SA	Tas	ACT	NT	National
Total existing licensees	64,096	51,016	54,480	31,090	18,530	5,051	3,500	5,733	233,496
Percentage of national total	27%	22%	23%	13%	8%	2%	1%	2%	100%

Note: These figures do not reflect the total workforce of the electrical occupations for NSW, Vic, WA, Tas or the ACT, where some electrical occupations are not licensed (see Attachment D for an overview of current licensing arrangements).

The industry is experiencing a sustained increase in demand for its services from the mining and resources sector. Skills Australia estimates that employment growth in mining operations will increase by 89,004 persons from 2010 to 2016, representing annual average growth in employment of 7.9 per cent over this period.⁵ Electricians are one of the top five fastest growing occupations in mining employment, as shown in Figure ES.. In general, the electrical services industry is important as an input to other sectors, and the licensing of this industry is important to public and industry confidence.

Figure ES.: Projections of employment growth in the top five fastest growing technicians and trade workers occupations in mining employment (less oil and gas), 2010 to 2016

Source: Skills Australia 2011, Employment growth projection in mining operations (less oil and gas), 2010–2016, p. 4.

Fly-in, fly-out work arrangements are a rapidly growing area in the mining and resources sector. While fly-in, fly-out arrangements can help to address skills shortages, Skills Australia argues that there is a need for options to facilitate greater increases in labour mobility if the resources sector and other sectors’ skills needs are to be met without adverse impacts on the rest of the economy.⁶ It should be acknowledged, however, that labour shortages can also be due to overall skills shortages nationwide. Further information on the electrical industry is available at Attachment B.