A lifelong “learning account”. Liberal, radical, just the way the party needs to go.

From free school meals in 1906 and 2014 to the Pupil Premium, Liberals have a proud and positive history in terms of reforming education in the UK. Despite this, Vince Cable’s idea of a “learning account” might be the most radical yet. The policy seems to be in its infancy at the moment with Vince Cable asking to “develop” the policy with the party. It would see all young people given a learning account, that they could use at any point in life for education purposes. As Mr Cable argued this is “fundamentally a liberal idea” and it is astonishing how little attention it has received.

The possible positives from this scheme seem remarkable; it would encourage social mobility as those from lower income households could make most use of the money. There are also deeper impacts in culture and sport, the power of education to inspire should not be forgotten. Giving people the freedom to choose exactly what to do with their education throughout adult life will give people an opportunity to pursue talents and careers they would previously only dreamed of.

There are of course some complaints. This of course would be an expensive policy and Vince Cable’s reply of taxing wealth certainly needs to be expanded upon. Yet here Vince Cable’s economic clout comes to the fold. In a recent speech to the Resolution Foundation on inequality he outlined how taxes can be improved. Specifically stopping loopholes in capital gains and inheritance tax as well as raising proposing tax on property value rather than council tax among other suggestions. Therefore, such a scheme would not be as hard to implement. 

Another criticism, that many students from higher income household do not need it and thus is a waste of money, first appears strong. However, the principle of this policy is to help people throughout their lives. From this, people who have been comfortable in the past but find themselves in need in later life are well supported. Additionally any money left over after someone’s death should be recycled in the scheme, reducing costs and if someone decides they won’t need it there should also be an opt out scheme where again the money is recycled.

Sue Pember, director of policy at adult learning provider membership body Holex and former civil servant, welcomed Vince Cable’s policy,  claiming:

 We support the concept of a learning account that could travel with the student through different stages of their lives, If we are to grow and prosper after Brexit, we need a comprehensive adult education, skills and employment funding plan.

The most impressive part of this policy however is possibly the simplest, it gives the people authority over their education, their future, their lives. This authority would be incredibly important throughout someone’s life, enabling them to retrain, get higher education or develop new skills. University students could also use it to pay for the debilitating costs of accommodation and academic books as well as being able to jump start a career.

Much needed technical careers would also greatly benefit. This, combined with a renewed focus on apprenticeships, would help develop the skilled and practical jobs the UK desperately needs. Firstly, students would be able to fund their initial training when pay is low and secondly, this policy allows for far greater mobility in changing profession later in life.

Not only is this a positive idea but it is also one that can be worked with other political parties, especially Labour, who have been talking about focusing on adult education. I heavily encourage the party to get behind Vince Cable with this idea; it will support everyone in this society, every individual, every group and every community.

* Simeon North is a proud member of the Liberal Democrats and study Politics and Philosophy at the London School of Economics. As the son of a teacher and doctor, the NHS and education are particularly important to him. He is also interested in the role Britain plays in the world. He writes online articles, enjoy reading books and wants to get more involved in journalism and with the Liberal Democrats.

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This entry was posted in Op-eds.


  • David Becket 4th Oct '17 - 10:33am

    This is the most welcome of the ideas we have seen from Vince, and we should be promoting it, or at least promoting we are working on it.

    I have no doubt that Vince’s Tax expertise will ensure it is affordable. It will give an equal playing field to all school leavers, as well as taking some of the sting out of Student Loans.
    It will also help those who have to change jobs in later life, and that is likely to occur more frequently in the future. If it is not used for education or training it cannot be spent, and the cut off should be on reaching retirement, we do not want to see it funding U3A.

    Lets run with it, shout it from the rooftops and have a few more similar ideas on Housing, Health & Social Security and Environment.

  • Peter Watson 4th Oct '17 - 10:51am

    The nature of learning/training accounts is being discussed quite thoroughly in a parallel thread (https://www.libdemvoice.org/policy-pitch-divert-money-from-tax-credits-to-lifelong-training-accounts-55385.html) so I would not want to repeat that here.

    Instead I would like to raise a simple question: why should this be an “account” rather than a loan in the same way as university tuition fees?

  • Peter Watson 4th Oct '17 - 11:07am

    “free school meals in … 2014”
    At the risk of diverting an important discussion on lifelong learning, I should point out that the Lib Dems were late converts to the notion of universal free school meals, having opposed the idea before Nick Clegg’s surprise announcement, and often presented it afterwards more like a bribe to voters already well-enough off to pay for school meals rather than as a tool for social mobility.

  • The problem with this is you will end up subsidising many people who may go into decently paid jobs, I.e. the same problem as ‘free’ university that is leveled at Labour. As Peter Watson might be hinting, why not look at bringing in a reformed loan system for FE that matches the university fees for progressiveness? That way people pay back individually, decide for themselves if it is worth it to go into x career, and it wouldnt stop retraining.

    The proposal would also be highly expensive, potentially funded from a source such as property, which would face the Ed Miliband “politics of envy” reaction from the public. Even JC steered clear of property. My prediction is that it will lose votes across the board while most of the youth/left continue to flock to Labour, therefore a poor trade-off.

    Don’t get me wrong, everybody should be willing to lose votes for liberal things like drug legalisation and opposing mass surveillance, but this proposal has little to do with liberalism – it is a mixture of misguided benevolence and others looking for a way to outgun Corbyn on free stuff and tax in the desperate hope the party will go back to its early 00s heydays. It won’t work.

  • Instead I would like to raise a simple question: why should this be an “account” rather than a loan in the same way as university tuition fees?

    Well, an ‘account’ effectively makes the monies/credit your’s ie. it transfers ownership to all – a liberal/SDP commitment; it also transfers some of the future growth risk away from the government and on to the market and individual.

    The shame is that the Child Trust Fund was a good initial attempt – oops! the LibDems were opposed to their creation and early on in Coalition closed them down!

    Using an account changes the equation from pay later (ie. student loans) – where we have lots of discussion about the affordability of repayments and whether the loan is repaid and what is the value to society of having a 60 year old going to Uni. given they are unlikely to repay their loan etc., to one where people are spending their savings/investment – thus a 60 year old, would be spending their money on further education, which given it is okay for that person to spend similar amounts (of savings) on cruise holidays, shouldn’t cause such handwringing discussions…

    So I suggest we look at the CTF case study and learn from it, because mistakes were made, but also there were many relevant lessons learnt.

  • Darren Martin 4th Oct '17 - 1:02pm

    I think this is a great policy idea and exactly the kind of thing the party should be working to develop.
    I just have a bit of an issue with the passage around wealth taxes to fund this.
    With this policy we should be looking to build a link between worker and business. Fundamentally we want to give people access to life-long learning so they can keep upskilling themselves as our economy changes. That benefits business as they have access to more skilled workers.
    So to fund it, we should be looking at how business can pay for it, a robot tax for example, that would offset job losses from automation into a learning account to help workers move on to other jobs.
    Unless of course you seek to define the value of the education as something greater than economic gain, framing it as something that adds to our shared wealth in many areas. Then a wealth tax makes sense but would be more difficult to make the case for.

  • Vince Cable is absolutely right to identify training as crucial. However, he is wrong to think that learning accounts are the way to go or that they are in any sense ‘liberal’. Frank Little (earlier comment) gives one good reason for this but there are other fundamental flaws in the plan and a subtle but crucial conceptual error that some above make.

    The big flaw is the assumption that one-size-fits-all. It doesn’t.

    In fact, need must vary by at least a factor of ten and probably more. One could presumably devise work-arounds but that implies a thick rule book and a large bureaucracy. Far from “giving people the freedom to choose…” it would snare them in byzantine rules, be unlikely to respond to demand (except perhaps from the largest companies) while the Treasury would drive towards cheapness (and hence, ultimately, failure). In short, it’s top-down and perilously close to a central planning solution.

    The conceptual error is thinking training is in any way comparable to welfare.

    Welfare provides safety nets but is horribly expensive so governments usually choose to focus help on the most needy with steep withdrawal rates for those just a little better off.

    In contrast learning is an INVESTMENT – made by an individual (and sometimes an employer) where the individual get a return in better wages, security, job satisfaction, mental health etc. Employers can get a return as well (but employees can leave) and society as a whole gets a big return – financial and other.

    The secret to investing well is in the old saying, “Look after the pennies and the pounds will look after themselves” – the “pennies” in this context being the individuals. So any successful scheme MUST put them in the driving seat by presenting them with an a la carte menu of choices linked to jobs. If it’s set up prudently and with high quality choices, then there is no limit on funding you should invest and fund with debt. In fact the more the better because it will all get a positive return – it’s becomes speculate to accumulate.

    Such an approach is bottom-up, empowering and responsive. And it has a proven track record as it’s how some of professions work.

  • George – As you say good training is vital. The investment must be ‘efficient’ in both financial & human terms and it must be simple to administer so it’s resilient against fraud while working for trainees in all firms from smallest to largest. Anything complicated will rule out firms too small to have specialist departments yet small firms are huge in aggregate.

    Elsewhere you stressed the importance of regulation to keep providers up to scratch. I agree. In this context regulation means assessments that they don’t control – a mix of written exams and experience logs etc. as appropriate for each course. It’s the job OFQUAL does for schools.

    The obvious regulators are trade associations. They have relevant expertise and a strong incentive to keep standards high or devalue their own skills. To participate they should be licensed by BIS to ensure they comply with scheme rules including that they are governed by members (co-operatives).

    Good mentoring is key to helping trainees find their feet and outperform expectations, especially if they have a troubled background (I suspect that this would be a very big non-financial win for the right approach). It is, of course, absolutely essential that employers can’t treat trainees as cheap and disposable labour.

    This implies that employers must have ‘skin in the game’ and happily it turns out that’s easy to arrange. Require training courses to be divided into ‘modules’ with, say, 4 of these comprising a ‘stage’ which must be passed before progressing. Then make employers responsible in the first instance for the costs (their own internal costs + course fees) and reimburse them for each candidate when and only when s/he passes a complete stage. If resits are needed, payment is delayed until they are passed.

    That’s easy to organise; on receipt of a schedule of successful candidates, BIS would refund employers according to a published tariff to cover course costs plus a fair allowance for the employer’s supervisory/mentoring costs (which can be very high). If the government wanted it could ‘supercharge’ training provision by overpaying in selected areas or trades or for the long term unemployed. What’s not to like?

  • Simon Banks 6th Dec '17 - 9:31am

    It is a good and fundamentally Liberal idea. The reason why it shouldn’t be a loan is that this would rule out use by, say, a 75-year-old living on the basic state pension or anyone living with severe and worsening impairments and without a lot in the bank.

    Like other bright ideas, though, it does need to be reality-checked. Opportunities like this are generally taken up mostly by the people whose education, social milieu and mindset alert them to opportunities – well-educated and/or middle-class people. To work as a measure towards equality – even just of opportunity – it would need plenty of advocacy.

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