Voluntary organisations such as Community Service Volunteers will be urged to bid for education and training cash as well as colleges and private companies under plans in the White Paper.
David Blunkett has singled them out as "particularly well-placed" to tackle social exclusion and to educate and train people with special or basic skill needs.
New funding regimes envisaged in Learning to Succeed would bring up to 2 million extra full-time and part-time youth, community and voluntary workers into education and training.
New rules will effectively abolish the divide between post-16 public, voluntary and private sector education and training. Any organisation which demonstrates it could meet the "essential quality and accountability thresholds" laid down by the Government would qualify for taxpayers' cash.
Mr Blunkett is seeking a new post-16 national framework balancing strategies of central Government with local flexibility and autonomy. "The creation of a single learning and skills council will simplify, and bring greater coherence to, arrangements for different types of education and qualifications, removing unnecessary bureaucracy and enabling the system to be more responsive to the needs of the individual," the paper says.
Adult education workers will be pleased that the divide between academic and vocational education - created under the 1992 FHE Act - is to be abolished. The Act removed all state subsidies from "leisure" courses, ranging from flower arranging to philosophy. The result was a big decline in the number of adults taking classes.
With the abolition of training and enterprise councils, the relatively new network of national training organisations will now provide vital market data on skill shortages and training needs. The NTOs, which set training standards and act as a voice for specific industries and sectors, from farming to accountancy, are also seen as potential training agents.
By the end of the year there will be more than 75 NTOs covering more than 95 per cent of the workforce. "They will help the Government extend and improve its dialogue with employers to ensure that the needs of businesses are taken fully into account in developing policy," the paper says.
The comment reflects ministers' dismay over the failure of TECs to involve industry more fully in education and training.
A boost is also to be given to the Small Business Service, recently created to assist new companies and firms with fewer than 250 staff. The organisation is to provide a "single gateway" for access to services for small businesses.
Further education colleges remain the key agencies for the expansion of education and training. They are expected to absorb the bulk of the 700,000 students to be recruited over the next two years.
While the new learning and skills council for England is a very different body to those it is to replace, it will most resemble the Further Education Funding Council. Its emphasis will be on partnership. Throughout the White Paper, the emphasis in on local partnerships involving organisations such as the University for Industry.