Upskilling and reskilling has a range of positive benefits for the individual, their employer and the wider economy.
These benefits include increased earnings and well-being for the individual; increased productivity and thus increased competitiveness, lower costs and higher output for employers; and increased tax revenues and reduced state benefit payments for the benefit of the wider economy.
A reduction in adult skills funding
Given the raft of benefits derived from adult education, it seems somewhat odd that there has been a 45% reduction in adult skills funding since 2009-10. Added to this are policy decisions such as scrapping plans to extend tax relief for self-funded work related training which again appear to be counter-intuitive.
AAT is not alone in being concerned about the current adult education landscape in the UK. Earlier today, the Centenary Commission published a comprehensive report on the provision for, and possibilities of, adult education today and for the century ahead.
The Commission consists of senior figures with a broad range of skills and experience including Dame Helen Ghosh, Sir Ken Olisa OBE, Ruth Spellman OBE and Lord Bilimoria. Its recommendations should therefore not be taken lightly.
Encouraging lifelong learning
Indeed, many of the 18 recommendations are things that AAT has been lobbying on for several years, for example broadening the apprenticeship levy and calling for national information campaigns to encourage lifelong learning.
Likewise, the Centenary Commission places a strong emphasis on literacy, numeracy and digital skills as AAT has frequently done in recent years.
But there is more to consider in the report, not least the recommendation to introduce a lifelong learning account for individuals. This is a proposal put forward and supported by many, indeed it is currently Liberal Democrat Party policy, but policymakers are nervous of such a scheme given the disastrous Individual Learning Accounts (ILAs) introduced by Labour at the turn of the century.
Parliament’s Public Accounts Committee reported that more than a third of the £290m taxpayer expenditure on the scheme related to fraud and abuse – and £37m of the total cost went to Capita to run it. Despite the fraud, abuse and mismanagement, there was widespread acceptance that the principle of ILAs was sound and that it helped many people to improve and gain new skills that they otherwise would not have.
Improved testing and piloting required
Given the significant benefits to individual learners and in turn to employers and the economy, AAT would cautiously back the return of a lifelong learning account provided there is substantially improved planning and risk management, robust quality assurance and extensive testing and piloting before any national rollout.
The Centenary Commission also calls for there to be a specific minister for adult education. Given the Government scrapped the position of Skills Minister (for whom Adult education was a responsibility) and subsumed all the responsibilities of that role into the large remit of the Secretary of State, AAT can understand why this is a particularly sensitive subject.
However, whilst the sentiment is understandable, the reality is that every sector thinks they are important enough to warrant a specific minister and even those that have this, are far from guaranteed good policy or increased investment. A dedicated Minister might be helpful but is certainly not essential.
Reporting on employee education spending
Finally, another Centenary Commission recommendation requires further consideration – the recommendation that employers be required to report annually on their employee education spending and to break this down to show how much is spent on the top 20% of earners and how much on the bottom 20% of earners.
This undoubtedly has some merit because it could incentivise (or embarrass) poor performers into investing more. But would simply reporting on this encourage behaviour change?
Reporting requirements have grown exponentially in recent years, for example in relation to the gender pay gap, executive pay gap and prompt payment reporting – much of this has made little difference because policymakers seem unable to understand that merely reporting on a problem is very different to doing something about it, especially amongst the most stubborn of organisations.
Good companies will always comply but it’s not the good companies that are the problem.
AAT backs the majority of recommendations in the report; believes further work is needed on some of these but that it offers a very positive contribution to the debate on the future of adult skills and lifelong learning in the UK today.
More AAT news and further reading:
- AAT’s stance on the Scottish Tourism Tax
- AAT takes a stand against plastic waste
- How accountants and businesses should prepare for Britain leaving the EU
Phil Hall is AAT's Head of Public Affairs and Public Policy.