Latest figures show little progress with take-up of 24+ advanced learning loans. Stephen Evans looks at how the system needs to be reformed to encourage more interest.

With our low skills base has long held us back as a nation. We need to do better to improve our economy and boost social inclusion.

Every month, the Department for Business Innovation and Skills (BIS) releases data on how many people have applied for 24+ advanced learning loans.

People are more likely to invest if they can see how learning will lead on to greater earning and link to their life and career goals

And each month we at Niace hope for a dramatic rise in take-up to deliver the skills we need for our future success. So far our hopes have not been realised.

In 2014/15 there were around 60,000 applications for advanced learning loans under an allocation that could have paid for nearly six times that.

For 2015/16, the loans allocation has increased to £498m. We’ve calculated that this would pay for up to 430,000 eligible learners this year, but would require a seven fold increase.

The latest data showed a welcome increase in loan applications, but not on the scale needed to deliver the government’s ambitions.

There were around 16,000 applications in August 2015. Based on past trends, around 100,000 applications would’ve been needed to put us on track to utilise the full loans allocation for this year. And this really matters.

The shortfall in our skills base and how this holds us back as a nation is well-trodden ground. But it is still startling to look at the facts: of the 34 OECD nations, we are 24th for intermediate skills. These are the sort of skills that loans were designed for.

The result of this relatively poor performance is seen in low productivity, falls in social mobility, and lack of individual opportunity.

And yet it is not enough to say that the current system is not working as well as it should.

November’s spending review is likely to bring further cuts to public funding for skills.

Unprotected departments like BIS are expected to face cuts of between 25 per cent and 40 per cent by 2020.

It is therefore highly likely that the loans system will be extended to younger age groups and lower levels of learning.

Part of the rationale is to increase investment by employers and individuals and to put people in greater charge of their learning — as this is not just about cuts.

So there is a philosophy behind the loans system that is important. And it is likely to be a growing feature of our learning and skills system.

So where do we go from here?

At Niace we think we can, and we must, make the loans system work. We argue there are three key priorities to make this happen.

Firstly, people are more likely to invest if they can see how learning will lead on to greater earning and link to their life and career goals — so we’d like to see an open data revolution, giving providers the tools to prove the value of their learning.

People also often want shorter, tailored provision. But you currently can’t get a loan for a module or a unit. We’d like a flexible learning revolution, working in partnership to stimulate demand for learning among individuals and employers.

Also, with regards to devolution, learning and skills will have greater impact where integrated with support for social inclusion and economic growth, in other words matched to employer and local needs.

We, therefore, want to see cities and local areas given power to provide wraparound career advancement support and tailor provision to local need.

Our low skills base has long held us back as a nation. We need to do better to improve our economy and boost social inclusion.

Advanced learning loans will be important in doing this, but they’re not working as they need to at present. We must do better and, working together, we can do better.