You may have missed it in the news recently, but on the 17th of July the new Trade Support Loans Bill was passed through both the House of Representatives and the Senate.
What does this mean?
Eligible apprentices can now access Trade Support Loans of up to $20,000 over the course of their apprenticeship.
The loans assist apprentices with everyday living costs while they complete their apprenticeship, and will replace the 'Tools for your Trade' Grants which were scrapped on 30th June 2013. Similar to the previous scheme, the loan income is able to be used for any purpose suitable to the apprentice's needs.
The programme provides apprentices with up to a $20,000 paid monthly in arrears adding to;
Year 1 - Up to $8,000
Year 2 - Up to $6,000
Year 3 - Up to $4,000
Year 4 - Up to $2,000
How does it work?
The Trade Support Loans will work similar to the Government HECS/HELP Debt scheme, being repaid by the individual through the taxation system when the minimum income threshold is reached; in 2014-15 the minimum repayment occurs at $53,345.
The notable difference is that unlike the indexation on HECS/HELP Debt which is set to be changed to the Government Bond interest rate and caped at 6% p.a. as of 2016, Trade support loans will be indexed from the 1 July 2017 in line with the much lower consumer price index (CPI).
Another feature of the Trade Support loans is that apprentices who successfully complete their apprenticeship receive a 20 percent discount on the balance of their loan, effectively meaning that the amount borrowed will be reduced by 20 percent.
Follow this link to find a list of Trade Support Loans eligible apprenticeships.
How do I apply?
Apprentices can apply for the loan through Australian Apprenticeships Centres - Murray Mallee Training and MEGT Apprenticeship Centre located in Swan Hill. Once the application is complete, apprentices can then choose to opt-in every 6 months, and can opt out at anytime.
For more information on trade support loans or if you would like to discuss whether they are right for your situation, call 5032 9422 and book an appointment today.