Individual Learning Accounts

1. Definition and objectives of Individual Learning Schemes

1.1. What are individual learning schemes?

This report focuses on individual learning schemes (ILS), which are training schemes that are attached to individuals (rather than to a specific employer or employment status) and which are at their disposal to undertake continuous training along their working lives and at their own initiative. These schemes are generally implemented by public authorities and mobilise public resources. Three main types of such schemes can be distinguished:

• Individual saving accounts for training (ISAT). These are schemes where the individual can accumulate resources for further training, and public authorities provide support under different forms, including: tax incentives, direct subsidies (grants or bonuses), and/or associated subsidised loans. Employers can also sometimes deposit money on/contribute to the account, which is frequently supported by tax incentives. These saving accounts are generally managed by a financial institution. This form of scheme is rare in practice. Pilot schemes have been implemented in the past in a number of countries, such as learn$ave in Canada and the Lifelong Learning Accounts (LiLAs) in the United States. In the first half of the 2000s, the Swedish government also worked on a project of individual saving accounts for training and passed a draft bill, but the plan was eventually abandoned.

• Individual learning accounts (ILA). These are schemes where rights for training are accumulated over a certain period of time. Publically financed, the account is virtual in the sense that the resources are only mobilised when training is actually undertaken and paid for. The only example of this type of scheme is the French Compte Personnel de Formation which, since January 2015, replaces an earlier training account (Droit Individuel à la Formation) making it broader in scope and fully transferable. The scheme is currently undergoing significant reform following the 2018 law entitled “Loi pour la liberté de choisir son avenir professionnel”.

• Voucher schemes. These are schemes which support training through direct governmental payments to individuals, often with a contribution from the participant him or herself. Although many individual learning schemes are named “individual learning accounts”, most of these schemes actually function as vouchers. Examples of voucher schemes include the Opleidingscheques in Flanders (Belgium), the Bildungsprämie in Germany, the Cheque formação in Portugal, the Individual Training Accounts in Scotland, the Chèque annuel de formation in Geneva Canton (Switzerland), and the Individual Training Accounts in the United States. The Bildungskonto in Upper Austria functions almost as a voucher scheme, although application is made only after training completion, and may actually be called a training subsidy.1 Former schemes such the UK and Wales Individual Learning Accounts were also voucher schemes in practice. Although available for a lifetime, the SkillsFuture Credit in Singapore also belongs more to the voucher category as there is no formally established accumulation of rights over time.2 Finally, Carta ILA in Tuscany (Italy) was a hybrid scheme in the sense that, instead of the regional government paying training providers chosen by individuals, a given amount of money was put on a bank account to be used directly by the individual.

Table 1.1 provides a very synthetic description of the main features of the six schemes reviewed in the case studies commissioned by the OECD, which are described more in detail in Section 2

Table 1.1. Main features of the six individual learning schemes reviewed

Compte personnel de formation (CPF), France, 2015 - to date	Individual learning account available for all labour force participants Financed through a compulsory training levy on firms EUR 500 per year per individual, capped at EUR 5000 in the standard case Training programmes need to deliver a certificate
Bildungskonto, Upper Austria, 1994 - to date	Ex-post training subsidy available for labour force participants (with a particular focus on the medium-skilled and women returning from parental leave) Financed through general taxation Covers 30% of training fees up to a maximum of EUR 2000 in the standard case Training programmes need to be vocationally oriented
Individual learning/training accounts (ILA/ITA), Scotland, 2004 - to date	Voucher scheme available for labour force participants with an income below a certain threshold Financed through general taxation GBP 200 per individual per year to cover training fees Training programmes need to deliver a qualification or certificate linked to priority curriculum areas
Individual training accounts (ITA), Michigan and Washington, 2000 ‑ to date	Voucher scheme available for participants in the Adult and Dislocated Workers programmes under the Workforce Innovation and Opportunity Act Financed by Federal government from general taxation No defined rules for amount of support Training programmes must be related to in-demand occupations and be on a list of eligible programmes
Carta ILA, Tuscany, 2004-2015	Scheme available for jobseekers and specific population groups Financed by the region from general taxation and the European Social Fund EUR 500-2500 per individual (one-off) Since 2008: training listed on a regional priority list
SkillsFuture Credit (SFC), Singapore, 2016 – to date	Lifetime voucher available to all citizens aged 25 and above Financed through general taxation SGD 500 per individual Training programmes need to be approved by the government agency running the scheme

1.2. Rationale and objectives of individual learning schemes

Public authorities put forward a number of reasons and objectives for creating the individual schemes reviewed in this report.

A large number of schemes aim to increase individual choice and responsibility. More freedom for individuals is expected to strengthen “ownership” of their training and result in a closer alignment with their personal projects. Promoting the individual’s autonomy in accessing and choosing training programmes is the first aim of the French Compte Personnel de Formation (CPF) created in January 2015.3 In Singapore, SkillsFuture Credit have been introduced to depart from the traditional employer-centric approach to training and provide individuals with some autonomy in choosing their training. The Individual Training Account (ITA) in the United States represents a move to a model where the customer chooses the type of training and the provider of training services, away from the more directed approach prevalent under previous national workforce programmes. The Bildungskonto in Upper Austria seeks to provide as much freedom as possible for individuals to decide about training participation according to their interests and motivation. In some cases, this increased autonomy and ownership is coupled with the explicit objective to share the financial burden of training and promote individual investment in training. For example, the Scottish Individual Learning Account seeks to encourage individuals to invest in their own learning and to take ownership. The former UK Individual learning account scheme was built in order to provide the individual with choice over what and how to learn, and to share the responsibility of investment in learning between employers, the government and individuals. In North America, the two former pilot individual saving account schemes (Lifelong Learning Accounts in the United States and learn$ave in Canada) were also implemented in that spirit.

An objective common to all schemes reviewed is to promote access of those with low access to training, generally the least-skilled, but also sometimes individuals with low-income, employees in small and medium enterprises, employees with non-standard contracts, self-employed workers, and, in some cases, more specific groups (see Section 1.2). In Upper Austria, for example, the Bildungskonto was created in the mid‑1990s for medium-skilled workers (mostly former apprentices) to compensate for the fact that they had received significantly less public support during their initial education than those who had completed upper secondary or higher education. In France, a main driver of the CPF implementation is the observation that although the law provides an equal right to training to employees regardless of contract type, strong inequalities in access to training persist in practice. The US ITA scheme aims to provide access to training to individuals facing multiple employment barriers.

Individual learning schemes also aim to increase the employability of individuals, in order to enhance their capacity to progress in their career and make professional transitions. ILS provide employees with some autonomy vis-à-vis their employer in terms of their training choices, and therefore allow them to take more control over their career path and think beyond their current job and employer. This could increase their employability by allowing workers to acquire skills that the employer might have been reluctant to provide from fear of seeing them leave. The French CPF was set up precisely to promote access to training for individuals who are expected to change jobs and eventually status (employee, self-employed, unemployed, not in the labour force) several times during their working life. The transferability of training rights across jobs and status is thus instrumental in the scheme. Some schemes, such as the Chèque annuel de formation in the Geneva region, have the wider goal of improving lifelong learning. SkillsFuture Credit in Singapore also aims to change the perception of lifelong learning, moving it away from chasing paper qualifications (credentials).4

Finally, promoting competition among training providers to lower the costs of training and improve its quality, including a better alignment with labour market needs, was a stated objective both in the former UK scheme and in the Scottish ILA, and has probably been a secondary objective in others.

Notes

← 1.  The application has to be made within a period of six months after the training was completed.

← 2.  It is planned that the government will provide periodic top-ups.

← 3.  The CPF succeeded to the Droit Individuel à la Formation (DIF), a scheme implemented in 2004 that provided credits in training hours to employees and could be mobilised at the employee’s initiative but with employer’s agreement. Initially not transferable from one job to the other, the DIF became portable in 2008. It aimed to promote co-investment in training by creating a middle way between employee-initiated and employer-initiated training.

← 4.  See e.g. the 2018 interview of the Minister for National Development https://www.straitstimes.com/singapore/lawrence-wong-focus-on-skills-not-paper-qualifications