[ARCHIVED CONTENT] Prime Minister welcomes Workforce Development Report (27/11/2001)

Prime Minister welcomes Workforce Development Report (27/11/2001)

The Prime Minister today welcomed the publication of 'In Demand: Adult Skills in the 21st Century' a report to the Government published today by the Government's Performance and Innovation Unit.

Research has shown that the UK suffers from a lack of skills in the workforce - 20 % of adults have poor basic skills and 36% of working age adults are not qualified up to level 2 (the equivalent of 5 good GCSEs).

The PIU was commissioned to look at how workforce development could contribute to the government's key aims of increasing productivity and tackling social exclusion, carrying forward the work of the National Skills Task Force. Proposals to improve the UK position on skills are also being considered in today's Pre-Budget Report, which builds on the PIU's work and the Chancellor's budget 2001 statement.

This report recommends a radically different strategy for skills. It proposes a much more demand led system in which the needs of employers and employees determine the provision of development, and considers a number of policy measures to take this agenda forward. It concludes that what is needed is a more coherent approach which helps firms adapt to increasingly competitive markets and helps individuals to update existing skills and learn new ones, rather than seeing education as something that happens just once.

In particular the report proposes:

Maintaining the clear focus on reducing the estimated 20% of the UK workforce who lack basic literacy and numeracy skills as the top priority, since without basic skills individuals may be trapped in insecure low paid jobs.
In the longer run, aiming to ensure that all adults have the opportunity to achieve a level 2 qualification (roughly equivalent to 5 good GCSEs).
Individuals and employers should be able to build on these foundations to develop the specific intermediate skills that are needed in local labour markets.

The Prime Minister has now asked the PIU to prepare a report setting out specific policies to be published next summer, alongside the results of the spending review. This work will be carried out in wide consultation with interested parties, under the guidance of John Healey the Minister for Adult Skills and in close collaboration with the DWP, DTI and Treasury.

The Learning and Skills Council, which is responsible for delivering government funded workforce development in England, will implement many of the proposals and will therefore work closely with the PIU throughout. The Small Business Service will also be involved, as they are responsible for delivering support, including workforce development, to small businesses.

Welcoming the PIU report, the Prime Minister, Tony Blair, said:

'Britain's future economic success depends critically on how well we use and unlock the talents and potential of our citizens. Schools must play the central role in preparing people for work and careers. But we must also help adults who have been failed by the education system, particularly those who lack basic literacy and numeracy skills. This report sets out a strategy to achieve these objectives. I have now asked the PIU, in close collaboration with DfES, DTI, DWP and Treasury, to take this work forward by developing a detailed action plan setting out agreed policy which will be published in the summer of 2002 alongside the spending review.'

John Healey, Minister for Adult Skills was Sponsor Minister for the report and also welcomed its publication:

'Better basic skills and a boost to technical learning in the UK workforce are vital if we are to compete with the rest of the world. This is an important report that sets out long term policy options for Government to consider. I look forward to working with ministerial colleagues and the PIU to deliver policies that will drive forward workforce development.'

Notes for editors

The Prime Minister announced the Workforce Development project in November 2000. John Healey, Minister for Adult Skills, was the Sponsor Minister for the project. Further information about the PIU can be found on its website www.cabinet-office/gov.uk/innovation
Key facts:

Workforce development consists of activities which increase the capacity of individuals to participate effectively in the workplace, thereby improving their productivity and employability.
UK labour productivity currently lags behind that in other major industrialised countries. Closing the productivity gap with Germany, for example, could generate £50bn more output over the next 10 years.
A more skilled workforce contributes to higher productivity and is better able to adapt to the demands of a changing economy. 36% of the working age adults in the UK, 13 million people, lack standard school-leaving (level 2) qualifications (UK figure is 2001 - more recent data is not available for comparison but 1998 figures were 28% France and 17% in Germany).
UK employers invest similar amounts to those in other countries (an estimated £23bn in 2000) but opportunities for development are concentrated on young workers, those with qualifications and those in larger firms (a quarter of those with degrees have typically participated in training in the preceding 4 weeks compared to only 4% of those with no qualifications).
Young people are becoming more qualified but there are a large number of adults in the UK workforce with no qualifications. They can be caught in a low pay/no pay cycle.
Giving adults the opportunity to improve basic skills or to achieve a Level 2 qualification helps them to become more employable and substantially increases the likelihood of them receiving development opportunities at work.
The Learning and Skills Council was established in April 2001 and has a total budget of £6bn next year. They are responsible for government funded post-16 education and training. Around one-third of its budget will be spent on developing adult skills.

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Prime Minister welcomes Workforce Development Report (27/11/2001)

Notes for editors