Right to Retrain – Time to bring back skills accounts?

Five Key Principles to Ensure the Success of Future Skills Accounts 

Nearly 20 years after it all went wrong with Individual Learning Accounts, the politicians think that it’s safe to go back into the water and consider whether skills accounts have a rightful place in the post-16 landscape.

In AELP’s view, they can do more than just dip their toes; the re-elected government’s promise of a National Skills Fund provides an opportunity to launch a well-designed successor scheme. Folding into the Fund the less than stellar National Retraining Scheme would add further resource to help make skills accounts a success.

The argument for bringing them back is simple. In the same way that the apprenticeship reforms have encouraged greater employer choice, skills accounts will give purchasing power to the individual learner with incentives for employers to support individuals further and for individuals to invest more themselves.

Against the challenges of post-Brexit migratory controls and increasing automation, they will have a major impact when there is a significant skills deficit in this country at all levels.

More specifically we can see skills accounts making a really positive difference in the areas of:

• Digital skills entitlement
• Level 2 and Level 3 entitlements
• Right to retrain
• Higher Education and Advanced Learner Loans funding and
• Maths and English.

Many will know the faults with the original ILA experiment and they largely relate to failures in quality control.

Addressing these should be at the forefront of a relaunch and AELP has submitted to government a blueprint for a skills account design which should:

1. Robustly tested and approved provider base

Ensure the skills account funding is routed through a robustly tested and approved provider base as opposed to the unmanageable 8,910 providers that previously accessed funding for ILAs – building on the more recent experiences of developing a robust government-approved apprenticeship training provider register to test the capability, capacity and readiness of providers to access government funding, with Ofsted the recognised regulator given oversight of judging the quality of the subsequent training delivered.

2. Catalogue of approved programmes

Control the breadth of qualifications and programmes available for individuals to buy with funding ring-fenced in their skills account with a catalogue of approved programmes – building on the lessons from advanced learner loans and the use of an approved central qualifications catalogue.

3. Latest technological advancements

Actively embrace the latest technological advancements to enhance, control and protect the integrity of the skills account system – identifying trends quickly, with the ability to suspend or investigate accounts based on specific behaviours or patterns, be that by learner type, geographical location or by programme/qualification type.

4. Shared responsibility to meet all needs

Not always expect government alone to shoulder the full responsibility to meet the total cost of the investment required. In addition to the entitlements and access to loans, there could be incentives for individuals and employers (and even combined authorities) to top up a skills account for targeted training. Incentives could be in the form of tax relief, national insurance contribution relief or rebates.

5. Targeted focus and facilitating access to grant and loan funding in one place

Structure skills accounts in a way that enables government to flexibility direct funding to support additional specific target to meet new or developing needs; for example an amount in all accounts to fund training on digital skills development and the account should be able to facilitate a mix of grants and loan funded provision in one place, acting as a one-stop shop for the individual to control and make informed choices.

Quality

On the issue of quality, let’s be clear that this should not be about restricting access to the market for new providers who offer innovation and competition, but be learning from past mistakes and experiences from programmes. These include allowing untested providers access to funding with ILAs in 2000, direct contracting to new providers with advanced learner loans and the first iteration of the register of apprenticeship training providers. It is vital to learn from past failings to develop an improved fresh approach.

ILAs were used to fund a huge range of qualifications which in many cases offered little value for money in terms of social mobility or productivity gains for the individual. In establishing skills accounts, there needs to be a centralised and controlled catalogue of fundable programmes/qualifications which are the only options for individuals to purchase via their account.

In 2013 for the launch of advanced learner loans, the ESFA produced a central online catalogue of fundable programmes which is updated across the year. Having a similar catalogue for skills accounts would be a sensible way forward.

More about the AELP proposals can be found in our recent AELP Submission: #77 to the DfE. Ministers are under orders from Downing Street and Treasury to review how they currently spend their departmental funding and with a new National Skills Fund, the occupants at Sanctuary Buildings have an exciting opportunity to make a fresh start with skills accounts which we believe will work.

Mark Dawe is Chief Executive of Association of Employment and Learning Providers