The CBI's decision to withdraw support for the Government's diploma programme is a massive blow for ministers' exams strategy.
The CBI wants ministers to ditch the academic diplomas in humanities, science and languages announced by the Schools Secretary, Ed Balls, last year. This puts a question mark over the credibility of the Government's new qualification just weeks before it is to be launched.
If the Government accedes to the CBI's request, the strategy being pursued by Mr Balls – pitting diplomas and A-levels/GCSEs against each other – would be ruined.
Diplomas would become just another vocational qualification taking second place to the more academic A-levels in the eyes of the universities and employers.
But if the Government stands firm, insisting that the diplomas bridge the academic and vocational divide, the lack of support from employers will see them wither on the vine.
I understand why the Schools minister, Jim Knight, is "surprised" by the CBI's statement. Industry has had unprecedented involvement in the planning of curriculum content in the diploma. But however justified the pique felt by ministers, the dilemma remains.
In a sense, the mess that the Government has got itself into stems from the decision by the former prime minister Tony Blair to reject the findings of the inquiry by Sir Mike Tomlinson into exams reform. It suggested an overarching diploma covering GCSEs, A-levels and vocational qualifications – thus ending the divide. It was a simple solution but Downing Street feared accusations from right-wing commentators that it was abandoning theA-level "gold standard".
It still makes the most sense as the way ahead but, alas, the U-turn has gone too far for any minister to admit it. But no other possible solution will work and – without that swallowing of government pride – thousands of youngsters will be sentenced to studying for a qualification that has insufficient esteem to open the doors to success in the job market.