Investment in training and skills

In the UK, nearly 40 per cent of adults now go on to higher education (HE). Yet university is not the only place of learning beyond the school gates. There is a wide range of education and training undertaken by adults, from vocational courses at local colleges to ongoing on-the-job training and apprenticeships. This post-18 education and training receives less attention than HE, but is crucial to developing the skills needed by the UK's workforce and to boosting economic productivity. There is a range of potential policy levers available to a government wishing to encourage employers and individuals to invest in post-18 education and training.

In this report, we focus on the funding and financing of adult education and training in England. This encompasses four policy areas: the public funding of adult education (which covers funding for post-18 further education), the non-HE student loan system, apprenticeship policy, and the taxation of training. We do not cover other areas in detail, such as the regulation of training, although these are unquestionably important to the skills system. We begin by setting out how adult education and training participation has changed over time and how the experience in the UK compares with that in other countries. We draw lessons from the history of skills policy. We then analyse each of the four different policy levers in England through the lens of the trade-off between costs and benefits. The report concludes by setting out the lessons that can be drawn from this analysis and some of the government's options for reform.

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