Shake-up to technical education to be confirmed amid major investment in skills at Budget

• ·       Budget to prioritise the next generation, helping young people get the skills they need to secure better-paid, higher-quality jobs
• ·       £500 million of investment every year will be committed to increase training for 16-19 year olds

A radical investment to implement the most ambitious post-16 education reforms since the introduction of A-levels 70 years ago will be placed at the heart of this week’s Budget.

The Chancellor, Philip Hammond will recognise that as the UK prepares to leave the EU, it is more important than ever that young people are ready and able to make the most of the opportunities ahead.

To give them the skills they need to secure the high-paid, high-skilled jobs of the future, he will announce a series of reforms to technical education, backed by over £500 million per year.

This will be underpinned by a transformation of the confusing current system of technical education, which is made up of around 13,000 separate qualifications. It will be replaced with a much more streamlined model of 15 world class routes that better suit the needs of students and businesses.

The government will work with employers and colleges to design these routes, from construction to creative based design professions, so that when young people leave college they have the skills, knowledge and expertise that employers want, as the Prime Minister’s modern Industrial Strategy boosts opportunities and spreads them to all sections of society and all regions of the country.

The new announcements also take the next step in the government’s plans to tackle weaknesses in the UK’s productivity levels – which the Chancellor will reiterate, is the only sustainable way to improve living standards for families up and down the country.

They will help deliver a vision to have two genuine routes of equal footing to develop world class skills for young people; either via a well-established academic route or a technical skills route with a new and improved upgraded system – helping to build an economy that works for everyone.

By pressing ahead with these reforms, the Chancellor will confirm that the government will deliver in full the recommendations of Lord Sainsbury’s review on Technical Education.

These include:

• ·        Increasing the amount of training for 16-19 year olds on technical routes by more than 50% to over 900 hours a year, including the completion of a high-quality industry work placement during the programme. These routes will be rolled out from 2019/20 and will receive over £500 million of new funding every year once fully up and running.
• ·        The provision of maintenance loans, like those available to university students, to students on higher technical education courses at levels 4-6 in National Colleges and Institutes of Technology. This will create real parity with the academic route. 

The Chancellor will also recognise that people should have the chance to retrain and upskill at all points of their lives and the Budget will set out further steps to support this, including:

• ·        Piloting new approaches to encourage lifelong learning to reflect the fact that the changing nature of work makes retraining and reskilling essential. A fund of up to £40m will be invested to test different approaches to do this.
• ·        Confirming maintenance loans for part-time degree-level study to improve support available to students, and doctoral loans to support higher-level study. Successive reforms to the student finance system now mean that government support will be available to adults wishing to study at any qualification level, from basic skills to PhDs.

Notes for Editors

There is a strong rationale to increase the technical skills of our young people:

• ·       There is increasing demand for intermediate and higher-level skills from employers: The CBI found that on balance, around 75% of businesses will demand more higher-level skills and around 40% will demand more intermediate level-skills.
• ·       Closer links to the world of work are required: 66% of employers consider work experience important for those entering the labour market, yet only 30% offer work experience.
• ·       The current system is confusing for students and employers: There are around 13,000 qualifications available for young people to choose from, many of which hold little value for either individuals or employers.
• ·       Our technical education system is weak by international standards: only 10% of 20-45 year olds hold technical education as their highest qualification, placing us 16th out of 20 OECD countries and by 2020 the UK is set to fall to 28th out of 32 OECD countries for intermediate (upper-secondary) skills.
• ·       And our current study programme for 16-19 year olds is smaller than leading international comparators: We currently fund 600 hours of study per year for our 16-19 year old students. This is less than countries with leading technical education systems, like Denmark and the Netherlands.