Commission on Social Justice: Minimum wage warning for Labour as party urged to adopt student loans: Education

Nursery education for 85 per cent of all three-year- olds and 95 per cent of four- year-olds.

Targets to ensure that all children can read and write by the time they are seven.

Examination reform which would broaden A- levels, bring extra rigour into vocational qualifications and possibly abolish the GCSE.

Labour moved closer to accepting that higher education should no longer be a free service last night when it welcomed the commission's findings.

Last year the party's higher education spokesman was sacked after making similar suggestions in a discussion paper.

Bryan Davies, the current Labour spokesman on higher education said the proposal that graduates should repay their fees and living costs would be assessed carefully.

'We have some radical thinking to do on an alternative strategy and the commission has given us a significant steer on that,' he said.

The commission argued that education should be a life-long process and that state funds should be used to buy nursery places for all rather than to pay for a minority of students who already had the advantage of both brains and wealth.

Many of the commission's ideas are borrowed from the National Commission on Education, which reported its findings last year. Both bodies emphasise the importance of getting all children into the education system as early as possible.

The report argues that nursery education should be available for all three- and four- year-olds. The cost, around pounds 1bn per year, could be met largely through taxation but would lead to savings on benefits as mothers were released on to the labour market. The commission suggests that developers applying to build on a site might be required to put in a new nursery school free of charge.

All the main political parties are in favour of universal nursery education, but the number of places needed could be higher than that assumed by the commission. It believes that 15 per cent of three-year- olds and 5 per cent of four- year-olds will stay at home, but in France the take-up is 99 per cent.

The commission calls for a single system of care for all under-fives, combining day-care and education. The two services could be provided in children's centres along with holiday care for primary-school children and support for parents, it says.

For children already at school, the report concentrates on improving literacy and numeracy. It says all pupils should learn to read and write by the time they are seven and that extra support should be available for those who struggle, but it does not define how fluent they should be.

The report says that the key to reform in the 14-19 age group is breaking down the barriers between academic and vocational education. It proposes radical changes to the examination system.

A-levels are too narrow, vocational qualifications lack intellectual rigour and school- leaving exams for 16-year-olds are now extinct in almost all developed countries, it argues.

The exams would be replaced by a broader 'A-level and vocational experience' for all 16- and 17-year-olds, with those who leave school taking part-time training to A-level standard.

A proposal that employers should have to pay up to 2 per cent of their payroll towards staff training has met with widespread approval, though it was pointed out that a training levy system abandoned by the current government set the level at 5 per cent.

Professor Alan Smithers, of Manchester University, said: 'It might be better if employees could decide whether to spend the money on education or on going to the South of France.

'Much of the money for training could be consumed just by running the system.'

On higher education, the report calls for radical change and questions the 'peculiar assumption . . . that universities should continue the boarding tradition of public schools.' In future, students will drop in and out of the system, building up points towards a degree as they go, rather than leaving home at 18 for three years of university life, it says.

While it questions the need for maintenance grants for part-time students, it argues that they should be funded on the same basis as full-timers.

Graduates should receive loans for maintenance and for one-fifth of their tuition costs, it says. Under a system similar to one in Australia, they would begin repaying the money once they were earning a reasonable amount, possibly 85 per cent of the average wage.

John Daniel, vice-chancellor of the Open University, welcomed the commission's commitment to a more level playing field between full-time and part-time students. 'Anything that makes people realise that there is a need for all sorts of people in higher education is a good thing,' he said.