Findings of the Basic Skills Agency survey - which looked at 379 projects the agency funded in the past three years - fly in the face of claims that short-term funding fails to lead to sustained long-term provision.

However, the study also found the projects were most likely to take off where there was a possibility of future long-term funding. Colleges proved particularly good seed beds for basic skills schemes as Further Education Funding Council cash could take over after initial development grants had run out.

Alan Wells, agency director, said short-term funding was “no answer to the long-term funding problems in the education services”.

The picture was much bleaker for small voluntary-sector organisations, who might find themselves forced to seek “short-term funding after short-term funding”, and often ended up unable to continue with literacy and numeracy projects.

Small and medium-sized companies, with less cash available for training, might also be unable to find the money to take over the funding of fledgling basic skills projects, putting such schemes at risk.