35.Even before the Covid-19 pandemic struck, the effects of an ageing population, automation and the Fourth Industrial Revolution were already starting to significantly shake up jobs and skills. The growth of new sectors, such as green energy, will spur demand for new skills, making it vital for adults to be able to reskill and upskill throughout their working lives. Yet we also know that adults face barriers to lifelong learning, with research commissioned by the Department reporting cost as a barrier identified by 42% of respondents.79 We therefore took evidence on Individual Learning Accounts (ILAs). Different forms of learning accounts have been developed in various countries, but essentially they provide a means of devolving choice and funding to the individual through a virtual account or a voucher to spend on accredited education or training.80 The introduction of the new £2.5 billion National Skills Fund offers a significant opportunity to implement ambitious lifelong learning policies and has reinvigorated discussions on learning accounts.81
The spectre of the failure of the 2000–1 Individual Learning Accounts (ILA) Scheme continues to appear every time learning accounts are mentioned. This is not without good reason, and the short-lived 2000–01 ILA scheme is an example of an ambitious policy that was sunk by the Department’s poor planning and inadequate risk management.82 The National Audit Office’s Individual Learning Accounts report provides a comprehensive examination of the Department’s failures, which resulted in a small number of training providers abusing their access to a system to open accounts and appropriate funds.83 The then Education and Skills Select Committee found that the ILA scheme had collapsed amid two main issues: “its rapid growth had outstripped its expected cost to public funds; and there were suspicions fraud had become so endemic that it could not be eradicated without killing the scheme.”84 The scheme had a budget of £199 million but actual expenditure exceeded £290 million.85 The failures of this scheme have meant that ILAs remain political kryptonite for English policymaking. Yet twenty years on, particularly with advances in technology and digital security, this need no longer be the case.
36.Written evidence highlighted that ILAs could stimulate participation in lifelong learning by lowering cost-barriers and encouraging individuals to take ownership over their skills and learning development.86 Baroness Wolf told us that:
you have to put far more of the power and decision-making in the hands of the individual and that you get better skills for the economy not by asking a Government Department to organise courses for people that they are sent on but by giving them far greater ability to learn skills when they think they want to.87
The Chartered Institute of Personnel Development suggested that learning accounts could offer scope for individual and employer co-investment.88 Similarly, Iain Murray, senior policy officer at the Trades Union Congress, told us:
One of the things we have been considering with the development of the lifelong learning account is that it functions as a wrapper. It makes people aware of their entitlements to funding coming through the state, but it also would facilitate other innovative kinds of funding, for example, employers agreeing to put in some money if an employee puts in some money. There are innovative ways of using lifelong learning accounts to empower people to take up boosted Government funding and also funding from other sources.89
37.As the Organisation for Economic Co-operation and Development’s (OECD) 2019 report sets out, various countries have adopted forms of learning accounts to boost adult skills and training.90 Close to home, versions of learning accounts have been introduced in Scotland and in Wales and there are likely to be lessons that could usefully be learned from their implementation.91 In 2019, Wales introduced a pilot Personal Learning Accounts (PLAs) scheme targeted at priority groups, such as adults in employment earning under £26,000. Under the PLA scheme, eligible adults receive full funding for college courses in skill shortage areas.92 Scotland has a system of Individual Training Accounts, which offer a grant of up to £200 for training courses for individuals who are looking for work or looking to progress in work.93 During the 2018/19 financial year, Scotland had spent £3.7 million on almost 19,000 accounts, and expected over 22,000 individuals to benefit from an account by the end of that year.94 Further afield, Singapore has a system of learning accounts that was highlighted in several written submissions as a gold-standard model.95 Unlike the versions in Wales and Scotland, Singapore’s ‘SkillsFuture Credit’ is a universal scheme for all adults over 25. It initially provides adults with S$500 (approximately £280) to spend on training, which is topped up at intervals. Adults over 40 receive an additional S$500 credit specifically aimed at mid-career support.96
38.We believe that there is a place for a rigorously designed and independently overseen Individual Learning Accounts scheme funded through the new National Skills Fund. This would put purchasing power into the hands of the individual, enabling adults to take control over their learning and skills pathways. The pilot or first iteration of the scheme should be targeted at groups who have historically low engagement rates with lifelong learning, such as those on low incomes. Ultimately, however, we would like to see the scheme take on a truly lifelong emphasis, moving beyond a one-off grant, to a system where adults receive 2–3 further top-up investments throughout their working lives to revitalise training and upskilling.
39.We recommend that the Government develop Individual Learning Accounts, drawing on the lessons learnt previously. These should be funded through the National Skills Fund, and initially should be aimed at unemployed adults and adults in work earning a low wage.
Chosen excerpts by Job Market Monitor. Read the whole story @ A plan for an adult skills and lifelong learning revolution – Education Committee – House of Commons