Former CBI chief to become Britain's new 'skills czar'

Gordon Brown is set to name Sir Digby Jones, the former director-general of the CBI, as Britain's new "skills czar" today in response to the recommendations of the Leitch Report on skills.

The Chancellor is also expected to adopt one of the key recommendations of the report, published yesterday, that calls for the lion's share of the £3bn of taxpayers' money pumped into adult vocational training to be spent by employers rather than colleges.

The Treasury-sponsored study warns of "undistinguished mediocrity" unless the country takes urgent action over training. It urges the Government to introduce a statutory entitlement to basic "Level Two" skills for employees in 2010 if there is no "radical step-change" in training provision. It also calls for compulsory education or work-place instruction for all employees up to the age of 18.

The 148-page document, written by Lord Leitch, former chairman and chief executive of Zurich Financial Services, calls for adult training to be "demand-led" rather than "centrally planned" - an implicit attack on further education colleges.

He calls for the voice of employers to be strengthened through a Commission for Employment and Skills reporting to the Government. In his pre-Budget report statement today Mr Brown is also expected to announce the creation of 500,000 new training places.

The Leitch report urged employers to be far more engaged in the issue of skills and substantially to increase their investment.

Lord Leitch, a Labour peer, said the Government should encourage employers to sign a "pledge" to commit themselves voluntarily to train all eligible employees to Level Two basic skills. Employer investment should also be increased in Level Three and level Four qualifications - equivalent to GCSE and A-level respectively. Under his vision, the number of apprenticeships would increase "dramatically".

The long-term unemployed should be given a compulsory "skills health check" in a "non-threatening" way to discover if a lack of training contributes to their unemployment.

Launching the study at the Treasury yesterday Lord Leitch pointed out that 5 million adults in the UK lacked functional literacy, 17 million had "difficulty with numbers" and more than one in six young people left school unable to read, write or add up properly.

He said his programme would yield £80bn worth of net benefit to the economy over 30 years, equivalent to an annual boost of £2.5bn.

"Skills were once a key lever for prosperity and fairness. Skills are now the key lever. This is quite simply the best investment we can ever make.

"Without increased skills, we would condemn ourselves to a lingering decline in competitiveness, diminishing economic growth and a bleaker future for all." he said.

John Brennan, chief executive of the Association of Colleges (AoC) welcomed the report's ambitious targets, but expressed concern about the major changes to the funding regime which he said needed "careful planning".