Saturday, January 12, 2019

An alternative approach to SkillsFuture

There are a few cases of large scale fraud with SkillsFuture. This is the govt program that pays a large part of the course fee and a daily allowance for the unemployed attendees.

There are good and bad aspects of this scheme. Some of the attendees found the courses to be useful for their careers. The quality of training provided by the institutions are good.

There are also bad cases. Some participants attended courses that are not really relevant to their needs. They went to the courses mainly to get the allowance.

Some of the training providers do not offer quality courses. The trainers are demotivated when a large part of the class comprise of disinterested attendees.

There are also a few cases of fraud. Some entrepreneurs set up training facilities primarily to tap the SkillsFuture credit. The enrolled participants who signed up mainly for the allowance.

I do not know the extent of the fraud and the wastefulness, compared to the real and useful skills obtained by the participants.

I suspect that it is difficult to monitor the fraud and the wastefulness.

I would prefer the SkillsFuture program to be scaled down and a large part of the funds used in some other ways to help the unemployed workers.

This is how I would approach it.

a) The unemployed worker should register for a placement program.
b) The program will help to place the unemployed worker with a registered employer. The govt will subsidise 50% of the wages, up to $1,000, for 1 year.
c) If the employer finds that the worker needs certain skills, they can send the worker to be trained during the first year.

This placement program may need more funds that the savings from SkillsFuture. The govt should set aside the additional funds.

This arrangement is likely to work better than current SkillsFuture funding.

What about workers who are still employed but wish to get some skills in case they have to change jobs?

They can skill attend the SkillsFuture courses, which should be largely subsidised directly by the govt. There is no need to set aside a credit in the worker's account for this purpose.

It is a bad idea to set aside the SkillsFuture credit account. It is money that tempts the worker to use it (otherwise it is wasted) and crooks to set up fraudulent schemes to tap these funds (it has happened).

We have many years of experience with the SkillsFuture scheme and its predecessor schemes (sorry, I cannot recall the names). Let us learn from the experience and find a better arrangement and hopefully a better outcome.

Tan Kin Lian

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