Speaking at a conference of business leaders, he outlined plans to increase the number of apprenticeships by 90,000 in the next five years, alongside welfare reforms to enable those out of work to acquire more skills.

Gordon Brown said: "A generation ago, a British Prime Minister had to worry about the global arms race. Today a British Prime Minister has to worry about the global skills race because the nation that shows it can bring out the best in all its people will be the great success story of the coming decades.

"The biggest barrier to full employment is now not the shortage of jobs but the shortage of skills among the unemployed and inactive. The biggest barrier to Britains success in the jobs of the future: a skills deficit particularly amongst the low paid."

John Denham, Secretary of State for Innovation, Universities and Skills agreed that for Britain to succeed in the global market, developing skills was essential and that apprenticeships had a vital part to play.

He said: "This plan details not only how the expansion in numbers will be delivered but also how the quality can be improved to ensure apprenticeships can be a mainstream option for more of our workforce and help secure a prosperous future for the whole country.

"This represents a major boost to our national skills base, to our ability to compete internationally, and to the prospects of those young people and adults to sustain rewarding and productive employment.

The new measures to expand apprenticeships include a pilot wage subsidy programme for small businesses and a new drive to increase apprenticeships in the public sector.

It is also hoped that enabling employers to provide their own accredited qualifications, such as the recently announced McDonald's "Basic Shift Manager" accreditation, will make it easier for employers to improve the range of apprenticeships on offer.

Concerns however have been voiced about the validity of such qualifications outside the firm which awards them. UCU general secretary, Sally Hunt, commented: "We fully understand the benefits of people being able to transfer in-house accredited training to the next level. However, we would have concerns about qualifications that are very narrow and specific to one organisation, like McDonalds.

"Just last week, a report revealed that some universities have concerns over diplomas. We are unsure whether those institutions would be clamouring to accept people with McQualifications." "