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CEDEFOP-Workshop
Dr. Dieter DohmenThessaloniki, January 31, 2008
Individual Learning Accounts in Europe
– an Overview
Content
1. ILAs – a brief history and a definitionary
approach
2. „1st generation ILAs“ – “real” Saving
Accounts
3. „2nd generation ILAs“ – Individual Learning
Accounts
4. ILAs/Vouchers for SMEs
5. Summary
2. History and definition
First discussions on ILAs started roughly 10 years ago, e.g. in United Kingdom and Sweden
Basic idea was to establish saving accounts for LLL – however Sweden has not introduced the model at all and UK established a different approach
In recent years, saving accounts were introduced (for education in general) in Austria and, to some extent, in the Netherlands …
… and discussed in Germany
=> Experience is rather limited and not promising, if we refer to saving accounts
2. History and definition
However, there are many other models that are called ILA and which are different from saving accounts
„Non-saving“ ILAs were introduced in UK, the Netherlands, Belgium, the Basque region, Italy
Some of them operate on an account basis, others don‘t
? What is the core requirement to call an ILA an ILA?
Is it necessary that it operates via a bank account (technical approach)?
Or, is it an ILA, if it is called an „ILA“ (labelling approach)?
Otherwise, the distinction between ILAs, vouchers, cheques etc. blurs
3. 1st-Generation Saving ILAs
„Real“ saving accounts were mainly debated, but not implemented
UK and Netherlands: Initially, ILAs were thought off as saving accounts
Sweden: Tax-based saving approach
Austria: Saving within the home purchasing savings frame
First experience suggest a rather low usage
Explanation: Financing requirements are usually lowLimited ability of long-term planning for
further training (which is a must for higher amounts), Banking system‘s interest is very limited
4. 2nd- generation ILAs
ILAs for individuals
Unrestricted models for „All“:• UK, Austria, Italy, Training cheques in Flanders (Belgium)
Pilot-models for selected target groups:• The Netherlands, Flanders (Belgium) ILA, Canton Geneva
(Switzerland)
Allocation usually limited:• Co-financing of € 150 – € 500 (exceptions: Flanders
(Belgium), some regions in Italy)
Sporadically, higher support is available for selected target groups:
• e.g. in Austria and Italy
4. 2nd-generation ILAs: Findings
• Take up-rates appear to be relatively modest, usually, particularly when approach is country-wide
• Often, a gap exists between accounts opened and accounts utilized
• Average costs of further professional training are rather modest with up to € 500 (due to low funding or low costs?)
• Share of female participation is often above average
• Positive correlation of take-up rates and socio-economic factors or professional status
4. 2nd-generation ILAs: Findings
• Severe mobilisation effects, but also deadweight loss can be identified
• Deadweight loss might be reduced, if approach is clearly directed at certain target groups (e.g. income restrictions, unemployment)
• Quality assurance, information and advice are very important frame conditions to ensure proper function of ILAs (in fact, are important for any market driven or demand-led approach)
• Public relations seems an important factor, particularly to reach lowly-educated or difficult to reach target-groups
• Involving banks is costly and, thus, debatable. [email protected]
5. Vouchers for SMEs in Belgium
Vouchers/ILAs can be applied for companies as well:
SMEs in both regions (Flanders and Wallony) can buy up to (max. 400) vouchers with a value of € 30 at a price of € 15
Target: Increasing participation level to 20 hrs per employee
Achieved: 1.400 SMEs utilized the scheme with the first year
5. Small Firms Development Account in UK
Companies with 5 to 49 employees could participate
Identification of a “training champion” who was responsible for developing of a structured training plan, with support of a “training consultant”
50 % of the training costs, max. € 225 were covered by a grant
Findings:
Funds ranged from € 135 to € 28,500 (average amount € 3,000)
Companies with 5-10 employees were under-represented
Only 2 % of companies had not participated in training so far
Advice and support in developing training plans seems particularly important for SMEs
6. Summary
Real “saving accounts” don’t seem to be appropriate
ILAs can be applied to individuals and SMEs – empirical evidence is positive though pointing at some “weaknesses” (need for action)
Take-up rates and average costs (per measure) are mainly limited
Quality assurance, information and advice are very important add-ons
It seems possible to target certain groups, if properly addressed
However, how do we distinguish between ILAs and other modes, e.g. vouchers? Do we need to distinguish?
CEDEFOP-Workshop
Dr. Dieter DohmenThessaloniki, January 31, 2008
Individual Learning Accounts in Europe
– an Overview
