An independent commission set up by Paddy Ashdown, leader of the Liberal Democrats, has backed the idea of individual learning accounts as the best way of achieving a learning society.

Headed by Lord Dahrendorf, warden of St Antony's College Oxford, the Commission on Wealth Creation and Social Cohesion stressed the importance of a universal system of entitlement to learning. It said that this could be realised by establishing ILAs where both employers and employees contribute on a compulsory basis. Only such a system will resolve the dilemma between generic training needs and company interests, it said.

The commission suggested that different contribution rates might be set for different age groups, with a significantly higher rate for 16 to 19-year-olds to recognise the particular importance of learning for young people entering the labour force.

A basic contribution rate could be 1 per cent of the employee's salary, with the state making its contribution in the form of tax relief and interest-free lending against future payments. The commission added that ILA rights should continue through periods of unemployment.

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ILAs could be introduced through voluntary pilot schemes in the first instance, but the commission warned that the full effect of ILAs on education and employment will only be felt once a comprehensive and compulsory system is established. In the meantime, additional resources should be channelled through local education authorities and community education projects should be supported.

Although ILAs would support lifelong learning, the commission said that they are not intended to provide funding for typical academic study undertaken from post-GCSE to degree level.

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Report on Wealth Creation and Social Cohesion in a free society. Available from 50 Cumberland Mills Square, London E14 3BJ.