| A summary of the Leitch Review of Skills final report, December 2006
This review, chaired by Lord Leitch, set out in 2004 to consider the UK’s long-term skills needs. It also looked at how to better integrate skills and employment services. The review focuses on adult skills, because 70% of the 2020 working age population have already left compulsory education. However, it also recognises how vital effective education for young people is to the ambitions it sets out, and emphasises how critical reforms to GCSEs are to improve functional literacy and numeracy.
Although the UK’s skills base has improved significantly over the last decade, with rising school standards and growth in graduate numbers, its skills remain weak by international standards. The review finds that, even if current targets to improve skills are met, the UK’s skills base will still lag behind that of many comparator countries in 2020.
There is a direct correlation between skills, productivity and employment. Unless the UK can build on reforms to schools, colleges and universities and make its skills base one of its strengths, UK businesses will find it increasingly difficult to compete. As a result of low skills, the UK risks increasing inequality, deprivation and child poverty, and risks a generation cut off permanently from labour market opportunity.
The review therefore recommends radical change, which it hopes will lead to a more prosperous and fairer society. The estimated possible net benefit is at least £80 billion over 30 years. This would come from a boost in the productivity growth rate of up to 15% and an increase in the employment growth rate by around 10%. In turn, it is hoped that social deprivation, poverty and inequality will diminish. The review does not aim to set out a detailed plan for the future, but urges the UK Government and Devolved Administrations in Northern Ireland, Scotland and Wales to act to decide the next steps.
The Review recommends that the UK commit to becoming a world leader in skills by 2020, placed in the top eight of 30 OECD (Organisation for Economic Cooperation and Development) countries. This will be based on ensuring that every adult has a basic platform of skills, improving the quality of the UK’s intermediate skills base and ensuring improvements at the top end drive improved management and innovation. This will mean doubling attainment at most levels. Objectives for 2020 include*:
• 95% of adults to achieve the basic skills of functional literacy and numeracy, an increase from levels of 85% literacy and 79% numeracy in 2005.
• Exceeding 90% of adults qualified to at least Level 2, an increase from 69% in 2005. A commitment to go further and achieve 95% as soon as possible.
• Most of those having ‘intermediate’ skills to be qualified at Level 3 rather than Level 2. Improving the esteem, quantity and quality of intermediate skills. This means 1.9 million additional Level 3 attainments over the period and boosting the number of Apprentices to 500,000 a year.
• Exceeding 40% of adults qualified to Level 4 and above, up from 29% in 2005, with a commitment to continue progression.
* Adults means age 19 to State Pension age. Basic means everyday literacy and numeracy skills. Level 2 equates to 5 good GCSEs; Level 3 equates to 2 ‘A’ levels; Level 4 equates to a degree (or their vocational equivalents).
• Shared responsibility: employers, individuals and the Government must increase action and investment. Employers and individuals should contribute most where they derive the greatest private returns – at the higher skill levels. Government investment must focus on ensuring a basic platform of skills for all, targeting help where it is needed most.
• Focus on economically valuable skills: skill developments must provide real returns.
• Demand-led skills: vocational skills must meet the needs of individuals and employers rather than being centrally planned.
• Adapt and respond: it is impossible accurately to predict future market needs.
• Build on existing structures: improve performance through simplification and rationalisation, stronger performance management and clearer remits. Continuity is important.
• Increase adult skills across all levels. Additional annual investment in skills up to Level 3 will need to rise to £1.5-2 billion by 2020, and increased investment is required in higher education.
• Route all public funding for adult vocational skills in England, apart from community learning, through Train to Gain and Learner Accounts by 2010. (Train to Gain offers employers workplace training to meet their needs, with public subsidy for training for first, full Level 2 qualifications and support for wider training beyond that level. Learner Accounts would be used by individuals to pay towards accredited learning of their choice, based on current schemes in Wales and Scotland.)
• Strengthen employer voice. Rationalise existing bodies and better articulate employer views on skills by creating a new Commission for Employment and Skills, reporting to central Government and the devolved administrations. The Commission will manage employer influence on skills.
• Increase employer engagement and investment in skills. Reform, relicense and empower Sector Skills Councils (SSC). Deliver more economically valuable skills by only allowing public funding for vocational qualifications where the content has been approved by SSCs. Expand skills brokerage services for both small and large employers.
• Launch a new ‘pledge’ for employers to voluntarily commit to train all eligible employees up to Level 2 in the workplace. In 2010, review progress, and if the improvement rate is insufficient, introduce a statutory entitlement to workplace training at Level 2 in consultation with employers and unions.
• Increase employer investment in Level 3 and 4 qualifications in the workplace. Extend Train to Gain to higher levels. Dramatically increase Apprenticeship volumes. Improve engagement between employers and universities. Increase co-funded workplace degrees. Increase focus on Level 5 and above skills.
• Increase people’s aspirations and awareness of the value of skills to them and their families. Create high profile, sustained awareness programmes. Develop a new universal adult careers service.
• Create a new integrated employment and skills service, based upon existing structures, to increase sustainable employment and progression. Ensure that all involved in such services, from Government departments, the Learning and Skills Council and Jobcentre Plus, to front line staff and colleges, focus on people’s long-term, as well as short-term, prospects. Launch a new programme to improve basic skills for those out of work, embedding this support for disadvantaged people and repeat claimants, and offering in-work support to those who find employment. Develop a network of employer-led Employment and Skills Boards, building on current models, to influence delivery.
To download the full report visit www.hm-treasury.gov.uk
To download the Government's response to the Leitch review, World Class Skills: Implementing the Leitch Review of Skills in England (July 2007), visit www.dius.gov.uk/publications/leitch.html
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