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Lessons on account at the 21st-century bank

Education is the key to national renewal the Social Justice Commission said this week. Susan Young analyses its report. Tony Blair has indicated that Labour is prepared to look at the options, although it fears discouraging students from poorer families.

The Learning Bank is probably the most radical of the commission's ideas on maximising opportunities in the 21st century. In its simplest form, every 18-year-old (eventually including aspiring university students) would have an Individual Learning Account in which the Government had "banked" enough credits to provide three years' full-time learning.

Effectively, this would be a loan which would have to be paid back through tax, once the learner was back in work and earning above a certain threshold.

The commission believes the bank would be particularly useful for creating true parity between academic and vocational paths, as everyone would get the same three-year entitlement to "spend" as they wished. They hope it would encourage lifelong learning by enabling individuals to buy diploma courses and a variety of full or part-time tuition, delivered in a range of ways and at times to suit them. There would be nothing to stop a worker taking a two-year diploma at one time, and 10 years later taking further courses up to the limit of entitlement.

Both maintenance and tuition fees could be borrowed from the bank. Initially, university students would not be involved in the scheme - the commission sees an urgent need to reform higher education funding, and wants that tackled first. It suggests that maintenance and a proportion of tuition fees should be repayable by one of three methods it outlines.

Even recently, this prospect has been politically unacceptable to Labour which fears discouraging students from poorer families, but this week Tony Blair indicated that the party was prepared to look carefully at the options.

He also indicated his real enthusiasm for the individual learning account plan, and in particular the commission's idea that workers could also be given credits by employers, either in compensation for not providing their own training or as part of a company benefits package.

However, it appears that privately Labour is less convinced about the idea, regarding it as too complicated for people to understand.

The bank was one of the commission's final ideas, and one it felt worthy of further development. Researcher Richard Thomas, who was involved with developing the idea, will be further investigating its possibilities, including suggestions that as a quasi-autonomous institution with Government underwriting, it could raise funds by selling "Learning Bonds" to investors and by other means.

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