On 1 December 2025, the Australian Government announced significant changes to the apprenticeship incentives available to businesses from 1 January 2026. The scope and size of available incentives to employers have been narrowed to target select occupations and industries aligned to the housing and clean energy sectors, which now form the basis of the Key Apprenticeship Program.
Full-time apprentices engaged through the KAP now attract $5,000 paid in two instalments. Those who commenced prior to 1 January 2026 will be grandfathered under the previous arrangements.
Employers engaging apprentices not in the KAP, but in an eligible Australian Apprenticeship Priority List occupation, are still eligible to receive incentive payments through the Australian Apprentice Training Support Payment (AATSP); however, the maximum payment will reduce from $5,000 to $2,500, paid over the first two years of an apprenticeship.
For those occupations not on the priority list, no incentive is available.
Incentives for Australian Apprenticeships: 1 January 2026 – 31 December 2026
|
Apprenticeship Type |
Total Investment |
Employer & Apprentice Incentive |
|
Key Apprenticeship Program |
$15,000 |
Apprentice: $10,000 Employer: $5,000 |
|
Priority Apprenticeship |
$5,000 |
Apprentice: $2,500 Employer: $2,500 |
Source: www.apprenticeships.gov.au
The changes were announced as part of the government’s mid-year budget update, released in December last year. The Australian Industry Group welcomed the announcement that financial incentives for employers who take on apprentices in the housing and new energy sectors will continue at the same level in 2026, but expressed concern that support will significantly reduce for those who employ apprentices and trainees in other sectors.
These changes will make taking on an apprentice less affordable in other industries including those important for lifting our sovereign manufacturing capability and delivering high-quality services in the community and aged care sectors. For those occupations not on the priority list who will receive no incentives, we anticipate further reductions in the structured work-based training that an apprenticeship or traineeship provides. The impact this will have on important skills and sectors of the workforce is of deep concern.
If you encounter any difficulties navigating this process and require assistance, you may contact your Apprentice Connect Australia Provider or call the Skilling Australia hotline on 1800 020 108.
Australian Industry Group members seeking additional assistance or who wish to provide feedback on the impact of these changes on their business can contact the Centre for Education and Training by emailing CET@australianindustrygroup.com.au or calling +61 (03) 9867 0226.
Read Australian Industry Group’s media release Support for apprentices is welcome, but some sectors will be left without (1 December 2025)
For more information on these changes, please visit the following sites:
Financial supports for Australian Apprentices and their employers continue from 1 January 2026
