Education is the most important thing of all. With it you can get a job and move up the social ladder."

I heard these words spoken by Nadia, a sixth-former, when, as chair of the Commission on Social Justice, colleagues and I visited her school in the East End of London. It is probably a more articulate summary of our views on the fundamental importance of learning than I could muster.

The commission has set out a radical blueprint for a better Britain. We argue that social justice and economic prosperity should -- indeed must, if we are to have either -- go together. And ambitious reforms to our education and training systems are at the centre of our project.

Our work starts from the premise that Britain's institutions and policies have failed to keep pace with the seismic changes which have occurred in our economy, and in family and civic life.

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Fifty years ago, path-breaking reports from William Beveridge and Rab Butler reshaped the welfare and education systems. Since then we have witnessed three revolutions, which have rendered obsolete old notions of welfare, work and learning.

There has been an economic revolution, driven by growing international competition and job-shedding technology; a social revolution resulting from women's rapidly changing life-chances and changes in family structure; and a political revolution which stems from the breakdown and marginalisation of old forms of governance -- "the end of deference".

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All of these revolutions demand a commitment to lifelong learning. For individuals, as well as companies and countries, education and training are the foundations of economic security -- a security which comes from skills for life, not jobs for life.

When one in ten jobs "dies" each year; when the shelf life of skills has halved in 20 years; when our skills base is the most important determinant of national success in an international economy, "thinking for a living" is not a choice but an imperative.

The United Kingdom is failing to meet these challenges. We are way behind our competitors in terms of entry rates to ÖйúAƬ. We are also behind in training, at the crucial 16-19 stage, and in pre-school education. The commission tackles them all: but I want to concentrate on our proposals for expanding ÖйúAƬ, and for making a reality of the rhetoric of "lifelong learning".

British universities have always provided a world class education for a small number of people. And in recent years the numbers entering ÖйúAƬ has gone up, which of course we welcome. But doing better is not good enough when others set their sights far higher.

Further expansion of ÖйúAƬ is unworkable with the current system of funding, which is already buckling under the strain of higher participation -- as this year's freeze on tuition fees for institutions which "over-shoot" on numbers so graphically demonstrates. We desperately need a new, fairer system for funding ÖйúAƬ.

Along with the National Commission on Education, we believe that those who do best out of ÖйúAƬ -- in terms of earnings -- should contribute to the cost of that education in order to allow others to enjoy the same benefits. Our proposed system of ÖйúAƬ contributions would cover maintenance and a proportion of average tuition costs, and be run through the national insurance system.

But -- unlike the current system of student loans -- repayments would be genuinely sensitive to a graduate's income. Entry to ÖйúAƬ must be on the basis of the ability to learn, not ability to pay.

A carefully-designed system of graduate contributions would not, we believe, deter potential students from poorer backgrounds. The introduction of a similar scheme in Australia has had no impact on the background of entrants. And the real barrier to ÖйúAƬ is an insufficient supply of places -- and only radical reform of the funding structure, along the lines we suggest, will allow faster expansion.

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A fairer funding system would remove the inequalities between different types of course, which leave part-timers at a disadvantage. But our present funding system is not keeping even full-time students out of poverty. The combination of an eroded grant and student loan is not providing an adequate income. For those who choose to study full-time, more generous maintenance should be available -- but should be paid back after graduation if earnings are high enough.

Churning out more graduates is not the beginning and end of a radical education strategy, however. We must become used to the idea of learning throughout life: at work; in combination with part-time work; between periods of paid work; and from home through computer links.

We propose the establishment of a Learning Bank, to fund and make a reality of lifelong learning. The Learning Bank is designed to fund lifelong learning on a fair and flexible basis, and be funded by the different beneficiaries of a better-educated workforce and citizenry: the individuals themselves, the companies which employ them, and the state.

In the 20th century, a minority has always assumed that compulsory schooling would be followed by A levels and three years of ÖйúAƬ. In the 21st century we must make the entitlement to extended education across the life-cycle the expectation of everyone -- regardless of whether or not they choose the traditional route. All forms of learning would be treated equally by the bank, along the lines I have described for ÖйúAƬ.

A flexible and fair funding system has to be based on a flexible system of qualifications. Funding from the bank would be based on an integrated, credit-based framework of learning, academic and vocational. The accumulation of credits by students would drive the system, forming the building blocks of lifelong learning and shifting the focus from teachers to learners, from a national curriculum to an individual's curriculum.

The bank would hold an Individual Learning Account for each person, into which employers, government and individuals could pay. A company might offer to pay into an employee's Learning Account as part of their remuneration package.

The bank, while fully accountable, would be set up at arms length from government in order to raise private finance for learning: in the long run, the bank might issue "Learning Bonds" to raise private sector money.

Employers are key players in providing and paying for lifelong learning. Those who invest heavily in their staff's training are rewarded with loyalty, quality and productivity. But far too many firms see training as something outside their sphere of concern.

We want to see the good employers crowding out the bad; we want companies to recognise and share responsibility for funding learning; we want to level up to the best of British industry. That's why we propose a minimum contribution by employers to training -- as a percentage of payroll. But, rather than going to a bureaucracy, the money would go into the individual's account at the bank.

Of course we cannot establish the bank overnight, and there are a number of practical issues to be resolved. But it is a radical vision for the future of learning, which could soon be sponsoring new opportunities for thousands of people.

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