£4.2 billion annual skills investment needed to overcome COVID-19 and reboot economy for 21st century

23 September 2020

The Future-Ready Skills Commission today calls for £4.2 billion a year of funding for adult skills to be devolved to regions, to help the UK recover from COVID-19 and be better able to adapt as the nature of work changes over the coming decades.

In its final report issued today, the Future-Ready Skills Commission makes nine key recommendations offering bold and innovative approaches to adult skills funding and careers advice, including a radical shift of powers for its delivery and governance.

Taken together the recommendations are designed to create a devolved skills system designed around people, businesses and local economies, meaning employers can recruit the talent they need, individuals can better access opportunities that will lead to more resilient, flexible and dynamic local labour markets that work for all, while contributing to the national recovery and the leveling-up agenda.

Cllr Susan Hinchcliffe, Chair of the Future-Ready Skills Commission and the West Yorkshire Combined Authority, and Leader of Bradford Council, said: “The devastating impact of the COVID-19 pandemic is being felt hardest by the most disadvantaged in the labour market. We can see the economy transforming in front of our eyes, with whole industries and sectors being decimated. Unless we can support people with skills and training in a way that fits with the reality on the ground where they live and work, we risk damaging the life chances of a whole generation.

“We need a radical change in attitude towards skills and training, enabling life-long learning, empowering people to take up their skills entitlements from school to retirement, and employers that value investing in their staff. As our report argues, the UK’s skills system has to be based on the needs of the people, businesses and local economies it is intended to serve if we are to build an economy that works for everyone.”

The report, A Blueprint for a Future-Ready Skills System, calls for:

• Reversing a decade of cuts to funding for adult education and devolving national funding streams to regions in their entirety, amounting to £4.2 billion in annual adult skills funding to be devolved
• Universal skills entitlements from school-leaving to retirement, with a right to minimum qualification levels, funding to support people’s ambitions, and careers advice and information based on local labour markets so people can understand how an investment in skills will be of benefit to them
• Far greater collaboration between employers and educators in setting local training agendas, with regional five-year strategic skills plans, supported by formal delivery agreements to create a stronger link between the needs of labour markets and the skills available

The Future-Ready Skills Commission is an independent, national commission supported by the West Yorkshire Combined Authority and made up of experts and leading thinkers from business, education, local government and think tanks.

Over the past two years, it has conducted an in-depth examination of the UK skills system, from post-16 education through to adult skills and career development, drawing upon national and international examples of best practice to design a skills system for the 21st century.

Its final report, A Blueprint for a Future-Ready Skills System, contains nine recommendations that, if enacted, would lead to an adult skills and training system that can better meet the needs of local economies, and future challenges and opportunities in the workplace.

Its recommendations are:

• Ensure the funding system offers fair access regardless of age, level of attainment, background and learning route alongside reversing the long-term decline in adult training
• Empower areas to design services around the individual to address complex and interrelated health, employment and skills issues
• Everyone should have the right to quality information about jobs and careers, no matter what their stage in life
• Employers should take greater ownership of their talent management and skills development, aided by a joined-up approach to business support that means they can find the help they need, regardless of the route they take to find it
• In order that people can gain the right skills needed for good quality work in their area, all adult skills and careers funding needs to be devolved
• Recognise that areas are best placed to understand their own skills requirements and implement statutory five-year strategic skills plans to make it happen
• Ensure that training meets the current and future skills needs of regional labour markets, delivery agreements with skills providers should be put in place, supported by investment funding
• Large-scale public infrastructure projects designed to level up areas should include an additional skills premium of up to 5% of the total budget to maximise their economic potential
• The Apprenticeship system needs national review to make it work more effectively, and this should include recognising and resourcing areas as the key route to employers and individuals