Member for Mallee John Forrest believes apprentice incentive cuts will disillusion adults who need retraining to remain in the workforce.
The Federal Government amended its Support for Adult Apprentices initiative in the Mid-year Economic and Fiscal Outlook 2012-13.
The amendment will save about $81.2 million in four years.
Mr Forrest said originally employers who paid an apprentice at a level at or above the national minimum wage could receive weekly payments of $150 in the first year of the apprenticeship up to $7800 in total.
He said the employer would then receive up to $100 a week in the second year of the apprenticeship up to $5200 in total.
Employers will now receive a lump sum of $4000 at the end of the first year of an apprenticeship.
Mr Forrest said the reduced incentives would make potential employers think twice about taking on an adult apprentice.
"The best thing for any human being is that they be gainfully employed," he said.
"If they're over 50 and lose their job, we need to see that people in that mature age area can be gainfully employed again."
Mr Forrest said the decision flew in the face of a call by the Greens to increase Newstart.
He said people needed better employment opportunities instead of relying on benefits.
"I don't expect people to live on $245 a fortnight," he said.
He said all people needed access to work.
"It's the best social policy," he said. "I am concerned that in our changing economic environment, we might see people consigned to the employment scrap heap when in fact they could be productive for many years to come if they receive essential training.
"It doesn't make sense to me."