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A key issue for the UK’s economy is how we meet the challenge of the Fourth Industrial Revolution and the future of work. Central to this challenge is the question of skills, an essential driver of productivity and growth.
Education and skills are the number one priority for employers that are struggling to find the right people with the right skills and who are increasingly concerned that they will not be able to fill positions in the future.
Yet more than half of all school leavers now go to university. More than ever before. While those who don’t are ill-served by an underfunded, second best, post-18 education offer. This suggests that our skills system is not fit for present purpose, or indeed the solution to the challenges of the future.
This report sets out a range of measures, to future proof skills and transform our education, training and skills system to address Britain’s productivity crisis. Skills for jobs that don’t yet exist, argues that funding and competing resources is a major consideration, but the solutions will need to take in whole-system changes to rebalance UK skills and prepare for the disruptive effects of automation.
1. Rebalance the UK’s tertiary education system. To provide a more cost-effective means of studying and to provide better value for money, for learners, business and Government. This will allow:
• A supply of vocational, technical and academic skills to meet the future needs of the UK’s industrial strategy
• Continuous, life-long, learning provision for all working age people
• New ways of teaching and studying, incorporating the advantages of technology to create new platforms and applications for remote learning, and
• New sector specific institutions for the delivery of specialised and bespoke training that can offer shorter, faster, more direct route for upskilling populations (such as Ecole 42 in Paris, Flat Iron in London, and Pursuit in New York).
2. Restructure skills funding with a National Education Contributions (NECs) scheme. We recommend a system akin to National Insurance Contributions (NICs), that would:
• Reform the whole funding system for tertiary education including the abolition of the current student loan system
• Separate the functions of Research & Development from skills acquisition and fund them appropriately
• Auto-enrol all workers to allow employees, employers and the government to pay into a central pot that could be drawn on by individuals, to fund skills training, at any stage in their lives.
• Provide a self-financing system that is ring-fenced from the Government’s national accounts, by using a Special Purpose Vehicle to collect NECs from employees, employers, and the government.
3. Create ‘Adult Skills Accounts’. To distribute the proceeds of national education contributions, this system would learn from previous experiments in the UK and internationally, to provide individual skills accounts that could be drawn on equally by all citizens, at any point during their working life.
4. Introduce a ‘Tech Levy’ and protect ‘Data Sovereignty’. To bolster the NEC model for lifelong learning, this paper proposes a new levy on established tech firms (which will benefit disproportionately from an educated workforce) alongside legislation to introduce and protect ‘data sovereignty’.
5. Re-imagine universities as a platform for continual learning. University subscription models should also be considered as a future role for Higher Education Institutions to support lifelong learning. This would provide students with multiple opportunities, not just between the ages of 18 and 22, but whenever necessary. To dip in and out of the curriculum throughout their lives to gain and update their knowledge and skills as needed, potentially paying lower tuition fees up front and then an annual subscription fee during their lifetime, utilising an Adult Skills Account.
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