Federal Budget 2026 – A deeper dive into the budget papers

Apprenticeship incentives

A key budget initiative is to change employers’ access to apprenticeship incentives from 1 January 2027, creating savings of $266 million. This comes from lowering the employer incentive for the Key Apprenticeship Program (KAP) and removing access for employers with 200 or more staff.

Group Training Organisations (GTOs) remain eligible for incentives regardless of their number of employees.

Australian Apprenticeship Priority List

The Priority List identifies occupations eligible for incentives, based on skill shortages requiring Certificate III level or above training. The methodology will be reviewed, with the intention that the list:

• Considers national and regional shortages using Jobs and Skills Australia data
• Uses two years of shortage data for stability
• Aligns with government priorities (construction, net zero, manufacturing, care)
• Supports women and First Nations employment

These changes will take effect from 1 January 2027. The 2026 Priority List remains unchanged.

Recognition of Migrant Skills

The Government will invest $85.2 million over four years from 2026–27 to improve recognition of migrant skills, including:

• $75.1 million for a new TRA assessment system and streamlined licensing pathways
• $5.6 million for skills assessments for onshore visa holders
• $4.5 million to strengthen oversight of assessing authorities

Consultation will also occur on a skills migration commissioner.

Member Forum: Have your say

Australian Industry Group will hold a Teams meeting at 11:00am AEST, Wednesday 17 June to gather member feedback.

Register via CET@australianindustrygroup.com.au