I thank the hon. Gentleman for his considered response to the statement, and for his detailed questions. He clearly shares our commitment to the skills agenda. As I have said, there needs to be a step change in the number of adults achieving both level 2 and level 3 qualifications.
The hon. Gentleman asked about the skills academies. We are committed to establishing 12 sector skills academies within the term of the next Parliament. They will be co-financed by industry and the Government and we have set money aside to finance the Government's contribution to them. Today, the Arcadia Group is announcing that it has put £10 million or more into a fashion retail academy that will serve the needs of the retail industry, and work with FE colleges and schools to develop vocational excellence in the retail sector. I hope that that model will be drawn on and that other models will also be used to develop the skills agenda across the country.
The hon. Gentleman also asked about level 2 and 3 qualifications. We are offering all adults a free training entitlement to receive basic skills training and level 2 training. We are also offering, through employers, a one-stop shop that will enable a single broker to go into businesses, from the smallest in the land to the largest, and, through face-to-face conversations, to assess the skill needs of the business and offer completely free, fully funded level 2 training for all the employees who need it. The broker will also identify the need for level 3 training in the business and offer to source that training, while the employer pays for it. Employers see a significant return on level 3 training—as do individuals—whereas on level 2 they do not. In two regions, we are also piloting the co-funding of the level 3 entitlement, so we shall be able to see whether a matched contribution from the Government will make a significant difference to employers who want their employees to gain level 3 training as well.
The hon. Gentleman asked about our target for increasing the number of people with level 3 qualifications. I have told him what the need of the country is: by 2012, two thirds of all existing jobs will require level 3 or higher qualifications. We have asked Sandy Leitch to carry out a review to determine precisely what our skill needs at level 3 and above will be over the next 10 years. He will report to us, and we will take his findings into account when we consider whether to put more money into level 3 training. We will of course await his report first.
The hon. Gentleman asked what we were doing to help younger people to acquire level 3 qualifications, and I can tell him that we are extending the adult learning grant, and that all young people under 30 will have access to a fixed sum from the Government so that they can study at that level. The results of the pilot schemes have shown that so far, the vast bulk of that funding has been drawn down to finance level 3 training.
The hon. Gentleman asked about higher education, and he was right to say that we ought to try to get employers involved in the design of qualifications at levels 4, 5 and beyond. In fact, that is what we are trying to do through the sector skills councils. Today, we are launching the first four sector skills agreements. For example, in the information technology sector, e-skills UK has designed a foundation-level degree in information and communications technology, which has involved employers coming together to specify exactly what is required in their industry. I would like to see the expansion of foundation degrees from the 50,000 being pursued this year to a significantly higher level as employers come together to back that expansion.
The hon. Gentleman also asked what was happening to the funding of the national employer training pilot, and whether it would really be demand-led. We have identified that take-up has so far exceeded the likely expected demand, which is why we have allocated an additional £65 million to the programme this year, in advance of the full roll-out over the following two years. We hope that that will be sufficient to meet demand, although we shall of course have to see how much demand is created. However, that is a sign of the success of the programme in its initial stages.
The hon. Gentleman asked about the right to time off for study. In the national employer training pilots, time off is negotiated as part of the agreement, so that workers can take time off to study towards a level 2 or 3 qualification. I am sure that the hon. Gentleman will agree that we have today moved forward significantly to advance our skills policy, and that that is the right thing to do for employers and for the country.