CEDEFOP-Workshop Dr. Dieter Dohmen Thessaloniki, January 31, 2008

1. Individual Learning Accounts in Europe– an Overview CEDEFOP-Workshop Dr. Dieter Dohmen Thessaloniki, January 31, 2008 D.Dohmen@fibs.eu

2. Content • ILAs – a brief history and a definitionary approach • „1st generation ILAs“ – “real” Saving Accounts • „2nd generation ILAs“ – Individual Learning Accounts • ILAs/Vouchers for SMEs • Summary D.Dohmen@fibs.eu

3. 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 D.Dohmen@fibs.eu

4. 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 D.Dohmen@fibs.eu

5. 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 low Limited ability of long-term planning for further training (which is a must for higher amounts), Banking system‘s interest is very limited D.Dohmen@fibs.eu

6. 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 D.Dohmen@fibs.eu

7. 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 D.Dohmen@fibs.eu

8. 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. D.Dohmen@fibs.eu

9. 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 D.Dohmen@fibs.eu

10. 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 D.Dohmen@fibs.eu

11. 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? D.Dohmen@fibs.eu

12. Individual Learning Accounts in Europe– an Overview CEDEFOP-Workshop Dr. Dieter Dohmen Thessaloniki, January 31, 2008 D.Dohmen@fibs.eu