Training tax credit should reimburse apprentices' tuition

News release

VANCOUVER (BCFL News Release) - B.C.'s new training tax credit should reimburse an apprentice's tuition upon completion of inter-provincial certification, says B.C. Federation of Labour President Jim Sinclair.BC Fed logo

The 2006 provincial budget included a $90 million tax credit for training but included no details on how it should be utilized. In the wake of the Federation's submission on the matter, the finance minister organized a consultation.

"Tuition fees have increased by 40 per cent while support to apprentices were all but eliminated," said Sinclair. The focus of any training tax credit must remain on apprentices. In addition to tuition reimbursement, the Federation submission also proposes an apprentice tool allowance for each year of apprenticeship training.

Sinclair's remarks came after a meeting with Finance Minister Carole Taylor to outline the Federation's submission to the provincial government's review of a training tax credit.

The Federation also proposed that, in order to maximize incentive for apprenticeship completion, the training tax credit must be back-end loaded for eligible employers. The proposed tax credit would increase in each subsequent year of a training program, with the largest amount claimed following the apprentice achieving trade certification.

Sinclair stressed that over the long term, rewarding good employers wouldn't be sufficient. "It's the old carrot and stick approach. The tax credit may be a carrot but where's the stick?" Sinclair asked.

"Employers who don't train should have to contribute to the system. Poaching skilled workers by the highest bidder might generate some nice paycheques for the individual worker, but in the long run will only hurt our economy," said Sinclair. Sinclair suggested B.C. consider the training model used in Quebec where employers must invest one per cent of their payroll in training.

Since 2001/2002, the number of provincial training certificates completed has decreased by 26 per cent. According to the Industry Training Authority, only 42 per cent of those in apprenticeship programs complete and attain their full credentials. This compares to a rate of 95 per cent for union-sponsored training programs.

Download a copy of Training Tax Credit submission below.

Submission-Training Tax Credit.pdf