Individual Learning Accounts

6. Emerging policy conclusions and trade-offs

6.1. Governance and processes need to be kept simple

Experiences in the various schemes reviewed show that simplicity of use is required to promote effective participation of individuals in individual learning schemes.

Heavy processes can discourage participation, as illustrated in particular by the French example. The complexity of the CPF in its first phase of implementation (2015-2018) meant that actors involved (funders, firms and training providers) needed some time to understand and learn to navigate it, and it also hampered the participation of individuals. Complex financing arrangements and fragmented governance made it difficult for individuals to appropriate the scheme and led employees to rely on their HR department and jobseekers on the public employment service (PES) for assistance. As a result, the autonomy of individuals to design their own training path did not improve much (IGAS, 2017[8]). The reformed French scheme aims to simplify both governance and processes, and to make the information system/website much more user-friendly.

Other countries/regions have also simplified processes. For example, in the Geneva region and Upper Austria, applications to the scheme can now be done online and delays to process requests have become shorter. Well-designed and user-friendly websites, as available in Singapore, Scotland and in the United States for the ITA, are instrumental to allow a real autonomy of use for individuals. On the other hand, full dematerialisation of processes (i.e. relying exclusively on the internet for managing applications etc.) risks excluding those who are not internet savvy and, therefore, the least-skilled.1 It is therefore important either to provide an alternative way of applying – e.g. through a paper application as in Upper Austria or a hotline as in Singapore – or to provide face-to-face assistance to individuals when they apply via internet, as in the Geneva region.2

It is not possible from the reviews conducted to come up with strong recommendations on governance models, but some findings emerge:

• As illustrated in the French case, governance should be kept simple, and in particular not be divided among too many actors, especially at a given management level (responsibility for implementation, administration, delivery).

• The only example of full outsourcing to a private for-profit entity of the administration of an ILS (i.e. the UK ILA scheme) proved unsuccessful – but this was partly due to the lack of quality assurance framework. Private provision of the services themselves, as in the US ITA, in Germany with the Bildungsprämie, and in Flanders with the check delivery, seems to be functional/less risky, but there is no available evidence on cost-effectiveness of the various options.

• In Scotland, the scheme used to be administered by a different public agency than the one responsible for its design and implementation. However, the administration was brought back in‑house when the new scheme (the ITA) was introduced. This was believed to facilitate change, but also streamlined delivery and reduced administrative overheads.

• Individual savings accounts for training appear to be expensive to manage, especially when they are small-scale. In the Canadian learn$save programme, financial institutions cited onerous security measures and technological and administrative procedures to maintain the database and write cheques from the accounts (Leckie et al., 2010[4]). The evaluation concluded that they were certainly not cost-effective due notably to very high administrative costs relative to the dollar value of the benefits transferred to the participants (half of the costs were for administration). The evaluation found that other programmes such as direct grants or loans or subsidised time off could have achieved the same objectives at lower unit costs. In the Tuscan scheme, the links with the banks managing the accounts appeared quite complex to deal with for provincial accountants, and this was an important motive for the switch to the voucher scheme which has now replaced the Carta ILA.

6.2. Financial support needs to be high enough to promote participation and allow real increases in qualification

Many of the existing individual learning schemes tend to provide small sums of money to support training costs (Section 2.5). In Portugal, Scotland, Singapore and Upper Austria, this is likely to have limited participation in the scheme. The small amounts involved also mean that participants can only undertake relatively short-duration training, which cannot lead to real increases in the individual’s qualification level. For example, the evaluation study of the Chèque annuel de formation in the Geneva region concluded that the support provided was too limited to finance a basic training curriculum (Cour des Comptes, 2015[2]).

Small sums of money can help individuals to acquire skills incrementally, thus allowing gradual progress in a given job or profession. However, these are less relevant if the individual wants/needs to make professional transitions and/or undertake professional retraining, a goal often attributed to individual learning schemes (Section 1.2). A real increase in qualification levels requires more significant support, including income support during the training period (to replace foregone earnings) as, for example, in the previous CIF scheme or the new CPF de transition in France, Qualification + in Geneva, or the Bildungskarenz in Upper Austria. Paid educational leave is also available in Belgium, which provides a maximum of 180 hours of training per year to employees.

In Singapore, workers/employers can obtain generous support through the Workforce Skills Qualifications scheme. In comparison, the SkillsFuture Credit only provides small amounts of support, which calls into question the usefulness of this scheme.

That being said, higher amounts of support could also result in potentially higher deadweight costs. As seen in Section 4.1, individuals with higher levels of education tend to be over-represented among ILS participants, and those with the lowest education level under-represented. This is clearly illustrated in the French case, where the CPF seems to primarily benefit the most autonomous individuals (i.e. high-skilled, managers/professionals, working in large firms). Although ILS are rarely evaluated (see Section 3.3), many ILS schemes are likely to have high deadweight losses, which will increase both with participation levels and the amounts of support at stake. This reiterates the importance of targeting.

Dividing learning programmes into self-contained and certified modules could also allow individuals to increase their qualification levels in several steps when the amount of support provided by ILS and/or time constraints do not allow to do it in one go (Commission externe d’évaluation des politiques publiques, 2010[29]).

6.3. Targeting may help to reduce deadweight losses and the participation bias against the low-skilled, but it can come with other costs

One option for reducing deadweight losses is to target. For example, eligibility to the Flemish scheme was restricted to low- and medium-educated workers only, precisely for that reason. Section 4.1 shows that targeting can help in some respect, in particular by reducing access of the high-skilled/high income (e.g. Scotland, Upper Austria, and the US ITA).

However, targeting support almost inevitably means heavier administrative burdens that may put off many of the very people who are being targeted (Johnson et al., 2010[26]). This was evidenced in 2007 in the case of the Scottish scheme, where non-standard workers (and the self-employed in particular) faced difficulties proving that their earnings were below a certain threshold. A requirement to provide tax forms may also be a barrier for those on zero-hour contracts, since their earnings are variable and unpredictable, and they would need to have worked for a long period of time before they can provide evidence of their usual level of earnings. The Canadian learn$ave scheme also struggled with the trade-off between administrative efficiency and accuracy in targeting, and with finding an approach to means-testing that was fair and at the same time responsive (Leckie et al., 2010[4]). It was particularly difficult to obtain complete documentation to check individuals’ incomes. In the Geneva region, despite the process simplification mentioned above, there is still no unique identification number that would allow to check, for example, whether there have been multiple applications by one and the same individual. At the same time, there is a duplication of efforts as individuals are asked to provide information which will later be checked again in the official databases (Cour des Comptes, 2015[2]).

Targeting can be simplified, however, as was highlighted in the Canadian evaluation report (Leckie et al., 2010[4]). One solution is to rely as much as possible on existing administrative databases – for example if low-income individuals are to be targeted, then existing income tests for social benefits (e.g. working tax credit, etc.) can be used, rather than to request participants to provide separate information on income. In Scotland, the new ITA simplifies the application process and at the same time transfers the task of checking eligibility to the training providers. In the previous ILA, learners would get funding and only then would identify a suitable course to take; now the reverse is true. At the application stage, individuals provide their National Insurance Number and a valid email address and answer some eligibility questions. Once funding is approved, applicants are required to book their training within eight weeks, and then provide proof of their identity and of their eligibility directly to the training provider.3

Another potential disadvantage of targeting is that it could conflict with the objective of portability/transferability of individual learning schemes (see Section 1.2). This is a particular risk for ILS that are limited to individuals in a particular employment status (e.g. employees, jobseekers, or the self‑employed) and could be especially problematic for those in non-standard forms of work, who are more likely to change employment status (e.g. from temporary work to unemployment) or combine different states at the same time (employee and self-employed). Targeting based on education or income level might be less problematic, but is not fully compatible either with the objective of promoting professional transitions and mobility, especially in the case of individual learning accounts where rights are accumulated. Modulating the amount of support according to such criteria, while providing access to all might be a possible way to square the circle. In France, for example, individuals who have no upper secondary qualification accrued twice as many training hours as other individuals until 2018, and from January 2019, accrue EUR 800 per year (up to a maximum of EUR 8 000), against EUR 500 (up to a maximum of EUR 5 000) for more highly-skilled individuals. A higher education threshold might even be considered (e.g. up to higher secondary education level, ISCED 3).

6.4. Accompanying measures are needed to increase the participation of under‑represented groups

Increasing the participation in training of under-represented groups is an objective for all individual learning schemes reviewed in this report (see Section 1.2). However, the available evidence suggests that this is not easy to achieve. When they are allowed to participate, higher-educated individuals are always over‑represented among ILS participants (see Section 4.1). A lack of data makes it difficult to establish whether this is more the case among ILS participants than among training participants in general. However, the information available suggests that this is true at least in France, where the difference in participation rate between higher- and lower-level occupational groups4 is higher for the CPF than for training in general. The Upper Austrian and US ITA schemes show that targeting based on education or income level can help to address this over-representation of the highly-educated. However, even when education level or income thresholds are set, the most disadvantaged groups still tend to be under-represented. For example, a 2007 evaluation showed that, even though it focused on low-income groups and the unemployed, the Scottish scheme was not reaching the least‑skilled (Gallacher et al., 2007[20]), and the same is true for the Upper Austrian Bildungskonto (see Section 4.1). The Canadian learn$ave experiment, although exclusively focused on low-income individuals, highlighted the very low take-up rate among this group, as low-income individuals did not see training as a viable option for them, even if they valued it – suggesting that the barriers to training go beyond mere financing. In the Geneva Canton, the possibility to benefit from three cheques in one given year turned out to mostly benefit skilled individuals (Cour des Comptes, 2015[2]).

Co-financing requirements, when present, can be a barrier to ILS participation for the most disadvantaged groups (see Section 4.2) and the tipping point is likely to vary across individuals, which makes it difficult to formulate recommendations on the desired level of co-financing. An even stronger barrier than the co‑financing of direct training costs, is likely to be the lack of replacement income when individuals take time off work to participate in training – particularly for the most disadvantaged. In France, the provision of a replacement income to temporary agency workers during their training period is probably a key determinant in explaining their higher participation rates in the CPF than for other employees. Hence, allowing the ILS to be used in combination with other schemes that provide replacement income is likely to raise the participation of under-represented groups, including the self-employed.

ILS participation might also be low among disadvantaged groups because it relies on the ability of participants to plan for the future, to anticipate how training can serve one’s career and to navigate the scheme autonomously, a capacity which might be particularly lacking among individuals in precarious situations ( (Euréval, 2012[30]). Providing good information, guidance and counselling may alleviate this problem. In Canada, NGOs were found to play an essential role in reaching the eligible population and supporting it through advice (Leckie et al., 2010[4]). By contrast, the fact that none of the participants of the special Bildungskonto for individuals returning from child care had received any counselling was seen as problematic, and career counselling was one of the recommendations of the evaluation report (Kellermayr, Ratzenböck-Höllerl and Reder, 2008[31]). In practice, few schemes have their own counselling services and, while data on the use of counselling is not readily available, it appears to be limited. In France, people collected on the street and interviewed in a “design thinking” exercise for the CPF web application all mentioned that simplification and the possibility to get in touch (i.e. face-to-face contact) with a coach/counsellor would improve the system, which otherwise made them feel “quite isolated”.5 Pro-active policies are needed to target information, advice and guidance on disadvantaged groups, as these services tend to also be taken up disproportionately by high-skilled workers (see e.g. OECD (2019[24]) for Flanders. However, these services have a cost and their financing needs to be planned ahead.

Overall, it appears clear that, in and of itself, an ILS is unlikely to achieve the goal of increasing access to training amongst under-represented groups. Aside from providing financial resources, individual learning schemes need to be accompanied by a number of parallel supporting measures/institutions to ensure that individuals have the effective capacity to convert these resources into valuable training outcomes (Gautié and Perez, 2012[32]).6 However, if these other measures limit the individual’s choice of training, then this will reduce the autonomy of individuals – one of the stated objectives of many ILS. In Flanders, for example, paid educational leave can be used to undertake a rather limited number of training programmes only (OECD, 2019[24]). In France, until December 2018, jobseekers were unable to mobilise their CPF autonomously and had to go through their counsellor at Pôle Emploi (the public employment service), thus leaving little room for individual initiative. The account was often mobilised as complementary funding for training which had already been decided on, sometimes even without the explicit agreement of the jobseeker (IGAS, 2017[8]). This highlights the difficulty to combine schemes/measures without fully diverting the objectives of autonomy and individualisation of the ILS. The nature of counselling services also matters, as they should not be too directive so as to respect the autonomy of the individual, yet at the same time ensure that the training benefits the participants.

6.5. The link with employer-provided training needs to be taken into account

As seen in Section 2.4, individual learning schemes differ in the way they co-exist with employer-provided training. Most schemes explicitly exclude a link between the two types of training, with the focus being on individual autonomy. Some schemes, and in particular the French CPF during its first implementation phase, do allow for a complementarity between the two types of training. Regardless of whether it is desired or not, there will often end up being an interaction between ILS and employer-provided training, and it is important to consider this at the design phase.

Experiences with ILS show that there is a risk that they partly remove the responsibility of training from employers. The frequent use of ILS in France and in Scotland to finance quasi-mandatory training programmes providing certificates required to work in certain sectors (3.2.2) is a case in point. These certificates derive from the employer’s legal obligations regarding hygiene, security or specific constraints linked to some activities or production environments. In those particular cases, training undertaken through the ILS is not additional to that provided by the employer, but simply substitutes for it. This use of the ILS in Scotland has likely contributed to the observed trend decrease in employer‑sponsored training since 2011. In France, the possibility to finance such training programmes through the CPF creates tensions among social partners, as some trade unions consider that employers should finance them. On the other hand, these certificates guarantee the transferable character of skills acquired by the employee and their recognition beyond their current employer. They may thus promote employee mobility and their employability in case of job loss (IGAS, 2017[8]).

One desired feature of individual learning schemes is that they can provide individuals with more autonomy regarding their own training decisions and the development of their careers, and they therefore make individuals less dependent on their current employer. This is one of the stated aims of SkillsFuture Credit in Singapore. Involving employers to obtain co-financing or the authorisation to take up training during working hours, as is often done in France, could therefore reduce the autonomy of the worker in his/her training choices. However, as discussed by IGAS (2017[8]) in the French case, the two type of uses – i.e. autonomous use of the CPF by the employee without informing his employer and the co-constructed use with the employer – are complementary and part of a single system. It offers the possibility to mobilise the CPF autonomously and confidentially allows the employees to keep their freedom of choice in front of the employer’s training proposals.

More fundamentally, because it is challenging to take up training while working full-time, a culture of learning among employees can only be fostered with the support of employers (OECD, 2019[1]). Besides, as evidenced by Lambert, Vero and Zimmermann (2012[33]), workers most often find incentives to take up training in their immediate work environment. The results of this study show that it is the environment provided by each company that contributes most decisively to employees’ aspiration to undergo vocational training, Employee training needs are found to be more strongly expressed when a series of conditions are met at the firms employing them, including: the availability of training opportunities, access to information, the ability to express individual and collective voice, and opportunities for horizontal and vertical mobility. Employers are therefore part of the “enabling environment” that can motivate workers to take up training (whether through ILS or not), including by recognising and valuing the skills acquired through training (Gautié and Perez, 2012[32]).

6.6. Individual learning schemes reinforce the need for quality assurance

The need to ensure training quality is an issue for all adult training systems. However, this becomes even more important in the case of individual learning schemes because individuals are in a much weaker position than public funders or employers when purchasing training. This is because there is an asymmetry in information on training quality and individuals only have limited capacity to negotiate the price with the provider.

While quality assurance frameworks have rarely been set up specifically for ILS, the creation of ILS has generally resulted in accelerating their implementation. The main instrument used by countries to ensure training quality is the certification of training providers, with requirements that are more or less demanding for providers across countries/schemes in terms of financial stability and pedagogical means. A trade-off exists between the strictness of the certification process and the ease of entry on the training market. For example, to ensure financial stability and avoid the creation of “false” training providers intent on fraud, Scotland requires training providers to have at least two years of activity to be certifiable. As shown in the French example, avoiding the proliferation of different certification labels is also important to harmonise practices among providers and to help individuals find their way.

A tension also exists between the strictness of training quality criteria and the freedom of choice of individuals. For example, the fact that only training programmes that result in certificates are eligible for the CPF is not welcomed by the self-employed or other professions (e.g. artists) in France, since they are more likely to be interested in non-certified training.7 Besides, the certification of providers and programmes may not suffice to ensure the quality of training, as discussed in Section 5.1.

The evaluation of outcomes of training programmes by public authorities needs to be carefully balanced against the cost that it imposes on training providers. In the case of the US ITA, for example, many providers did not comply with the initial obligation to provide information on outcomes because it was too costly for them. Besides, while some simple indicators – e.g. completion rates, employment rate after training in the case of jobseekers – are relatively simple to understand for the public, accurate indicators of training quality would probably require complex analytical methods – such as standardised or value‑added measures, indicators of multiple dimensions of quality, etc. – which are unlikely to be understood by most individuals (Finkelstein and Grubb, 2000[34]).

An alternative or complement to formal evaluations is to collect ex post assessments by individuals themselves which, even though subjective, can provide useful information to prospective participants. A number of existing ILS, such as the CPF, SkillsFuture Credit, and the Scottish ITA, intend to do this. The information collected in this way should be systematically provided to individuals through the ILS online application system or by counsellors.

The individualisation of training is also likely to affect the supply of training. Selling training services to individuals rather than to public funders (e.g. PES) or employers is challenging for training providers. It relies on the ability to enrol trainees on a continuous basis, which might be difficult for smaller providers, and may also result in providers concentrating on and marketing only the most popular/profitable types of training programmes (e.g. language classes). By contrast, the least “profitable” training programmes may disappear. This may be dealt with by leaving the latter to the large public providers when they exist (e.g. the Agence nationale pour la formation professionnelle des adultes in France), but might at the same time put these in a difficult financial position, in a context where they lose the most profitable segments of the market and are also subject to increased budget constraints.

6.7. Financing arrangements have distributive and sustainability implications

The financing modalities of ILS have important implications in terms of both redistribution and scheme sustainability. The higher the individual saving or co-financing requirements are, the less redistributive the schemes are. But how the public contribution to the scheme is financed also matters. Tax-financed schemes are redistributive (to the extent that the tax system is), but the experience in Upper Austria, Scotland and the United States shows that it makes the scheme very sensitive to budgetary constraints and therefore funding becomes less predictable over time. Budgetary financing is any case not compatible with the notion of training “rights” inherent to individual learning accounts, where credits for training are accumulated over time and have to be honoured. Financing the scheme through a training levy, as for example in France, has the advantage to earmark funding and allows some mutualisation at the same time (because small firms pay lower contributions to the training scheme, while benefiting from the same services).

6.8. Could ILS be used to increase participation in lifelong training among workers in new and non-standard forms of work?

Drawing on the above conclusions, a number of specific points can be made about whether ILS would be suitable to increase participation in lifelong training among workers in new forms of work (crowd work, on‑demand work via apps and platforms) and workers in non-standard forms of work (temporary work, casual work, self-employment).

By providing training rights to the individual/the worker, ILS may increase access for these groups who, when they are non-standard employees, tend to receive less employer-provided training than standard employees, or have less access to training than employees when they are self-employed. By attaching training rights to the individual rather than jobs, ILS also make training rights more portable/transferable between jobs, a feature which is particularly important for these groups of workers who tend to experience higher job mobility. However, to actually increase access to training for these groups of workers, ILS would need to meet a certain number of conditions.

First, transferability would require that the ILS covers all types of employment states, possibly even inactivity, given that non-standard workers are more likely to change status. Restricting accounts to low‑educated or low-income individuals may also conflict with the transferability of rights and upward professional transitions and mobility. As noted in Section 6.3, modulating the amount of support according to such criteria, while providing access to all, is probably more appropriate to increase access of workers in new and non-standard forms of work. This is what is done in France, for example.

Workers in new and non-standard forms of work will also require other accompanying measures if their participation in (useful) training is to be promoted (Section 6.4). Co-financing requirements ought to be limited; combinations with other schemes providing replacement income should be encouraged; and additional “enabling” measures (such as pro-active information and counselling) are needed. Favouring the development of training formats adapted to workers who may have difficulties to train during working hours (e.g. evening/week end classes, e-training) may also be particularly useful for these groups.

In practice, individual learning schemes vary in the extent to which they include non-standard workers. Self-employed workers, for example, tend to be increasingly covered by ILS although, in France, their effective access still remains to be implemented. Self-employed workers tend to be under-represented among participants in Scotland, but over-represented in Upper Austria. Information on the type of training they actually undertake compared with employees is not available, but the French case highlights that restricting eligible courses to certificates – as a way to ensure quality – is not well-perceived by the self‑employed who may be interested in following courses relevant for their activity but not necessarily delivering certificates.

Notes

← 1.  For example, in France in 2016, 15% of adults did not have an internet connexion at home and the same proportion declare not to be able to undertake administrative procedures online, even with help (IGAS, 2017[8]).

← 2.  Individuals can get help to apply to the Chèque annuel de formation at the Cité des Métiers et de la Formation.

← 3.  Proof of eligibility are three months’ payslips or a P60 annual tax return.

← 4.  Higher level occupational groups concern managerial/professional occupations (cadres), and lower level blue collar workers (ouvriers) and low-qualified white collar workers (employés).

← 5.  This exercise was led in a conference organised in July 2019 by #Leplusimportant, https://leplusimportant.org/2019/06/27/11-juillet-2019-colloque-ass-nat-numerique-reconnaissance-des-competences-de-chacun/

← 6.  This is in line with the capability approach developed by Amartya Sen.

← 7.  For example, a masseur might want to take a training programme in Thai massage.