During the current financial year my Office has had a strong focus on the achievement of Major Projects Skills Guarantee (MPSG) contractual commitments. While we welcome strong local content commitments, we have observed that agencies and contractors delivering Local Jobs First (LJF) Strategic Projects with MPSG commitments significantly above the mandated 10% minimum requirement are finding it challenging to deliver those commitments in the current tight labour market, particularly in regional areas.
The obligation to deliver on LIDP commitments, including MPSG, in LJF projects ultimately rests with government agencies. My advice to agencies in the current labour market environment is to re-double efforts to ensure a robust assessment of MPSG contractual commitments by contractors, particularly where these commitments are above the minimum 10% labour hours requirement.
Agencies should ensure there is compelling evidence of the plan to achieve MPSG commitments. The evidence should include contingency planning for unexpected events which may adversely impact the number of forecast hours to be completed by apprentices, trainees or cadets. This is particularly critical for projects or packages with short timeframes, as it is even more difficult to correct course within the time constraints.
Agencies should ensure that this MPSG scrutiny extends to all aspects of ongoing LJF project monitoring and reporting systems. Agencies’ LJF project governance frameworks should include detailed regular reporting of achievement against both local content and MPSG commitments, to enable the early detection and forecasting of potential challenges so that successful solutions may be found.
My Office is here to support agencies in their understanding and delivery of local content and MPSG commitments under LJF strategic projects, or to refer agencies to DJSIR or ICN as appropriate. For more information, contact us.
