Cash for skill base in dispute

Half of Britain's young people should be expected to continue their education after 16 for at least four years, education leaders were told last week.

Sir Bryan Nicholson, former president of the Confederation of British Industry and this year's president of the North of England Education Conference, told delegates that radical changes were needed to higher education if Britain was to compete effectively on the global market. He believed the rate of expansion of student numbers was too slow.

Instead, he praised the trend towards shorter courses, flexible study patterns, blurring of barriers between further and higher education and more locally-based students.

No country had ever gone bankrupt through investment in education and training, he said. The "tiger" economies of the Far East had grown so rapidly precisely because they had decided to invest heavily in that area.

His words will have carried particular weight with delegates at the Sheffield conference because Sir Bryan is close to Sir Ron Dearing, whose inquiry into the future of higher education will report later this year.

Gillian Shephard, Secretary of State for Education and Employment, speaking later at the conference, also praised the tiger economies' emphasis on education.

But she insisted that Britain had to keep costs firmly under control if it was to compete with these countries, where labour costs were lower. "Increasing that skill and knowledge base is the way forward," she said. "We cannot and will not succeed without it. But on its own, it is not sufficient."

She said team skills, innovation and flexibility were as important for young people as academic knowledge and job specific skills.

Don Foster, Liberal Democrat education and employment spokesman, accused Conservative policies of creating an education system that was failing young people.

He singled out the further education sector as "a time bomb waiting to explode", facing inevitable crisis if colleges continued to be run by market forces combined with underfunding.

More powers over FE policy should be delegated down from the Further Education Funding Council to the nine regional committees, he said.

David Blunkett, the Shadow education secretary, also attacked the Conservative education record and pledged Labour's own commitment.

"Tony Blair has been quite clear," he said. "Education will be the passion of this Labour Government."