1. Financing VET in Europe in the context of the new policy developments and challenges
27 November 2014
Mantas Sekmokas
Unit B2 - Vocational training and adult education, Erasmus +
DG Education and Culture

2. New Policy Agenda
Commission's vision: Agenda for Jobs, Growth, Fairness and Democratic Change - a “New Start for Europe”
Priorities of the Commissioner for Employment, Social Affairs, Skills and Labour Mobility, Ms Marianne Thyssen,
i) job creation and entrepreneurship
ii) access to employment
iii) skills development
iv) social protection
VET and AL to contribute
President Juncker presented his views on the priorities of the next Commission : "Agenda for Jobs, Growth, Fairness and Democratic Change".
A key concern is to bring about sustained growth and prosperity for all.
The Political Guidelines set out ten policy areas to be tackled under the new Agenda, the first being an ambitious Jobs, Growth and Investment Package that aims at strengthening Europe's competitiveness.
President Juncker sets out the idea to mobilise up to € 300 billion in additional public and private investment over the next three years. The focus of this additional investment should be in infrastructure (broadband and energy networks; transport infrastructure in industrial centres), education, research and innovation, and renewable energy/energy efficiency.
Investment in education and training should be a high priority, especially in the current economic climate. Developing the skills of European citizens is vital for Europe’s sustainable growth and a competitive and inclusive economy, with high levels of employment, productivity and social cohesion and VET and AL contribute to this together with the other educational sectors: school and higher education.

3. Investing in skills for socio-economic outcomes in Europe – key aspects
i) High quality education and training outcomes (not just systems)
ii) Smart investment - efficiency and effectiveness of different (financing) policies and mechanisms
iii) Shared investment: partnership and participations (challenges and considered possible solutions)
iv) Investment in innovation and excellence in VET
(i) The Commission’s recent Communication Rethinking education – Investing in skills for socio-economic outcomes stresses the need for more efficient investment in education and training. This is a strong argument to make educational outcomes – not systems – converge towards the provision of high levels of skills and competences. With starting decline of the EU labour force size; labour force aging and increasing skills requirements due to technological change all require high quality initial education, well-functioning skills upgrading systems (c-VET) and compensatory routes back to education and labour market for those lacking skills or qualifications.
(ii) Public budgets are tight, including those for education and training. The need for fiscal consolidation forces governments to cut spending and make difficult choices about priorities. This makes it more important than before to mobilise and use finances in effective and efficient way.
(iii) To ensure sustainability of financing closer cooperation and shared responsibility between all involved – national governments, employers and individuals – is needed more than ever before.
(iv) We need to further boost excellence in VET by providing practical policy and financial support and by establishing strategic networks that closely link VET provision with regional strategies for economic development and innovation.

4. Challenges Provide evidence on the benefits
Financing often lack sustainability and effectiveness
Relevant provision
Access of target groups most in need
Deliver better evidence on returns on education and training, by improving measurement methods and data collection, especially for CVET related indicators, as well as carrying out more research to evaluate the monetary and social benefits of learning. Help both organisations and individuals to assess more soundly the importance of education and training;
Under-provision; under-investment? More, better and balanced mix of incentives, rights and obligations for companies; supportive and information services for individuals.
Systems to finance often lack sustainability and effectiveness. Many EU Member States, particularly newer entrants to the EU, finance adult training with substantial support from the European Social Fund (ESF). A review of different financing and regulatory instruments (such as training funds, vouchers, grants, training lave) shows that their effectiveness and efficiency are often not clear.
Training funds, for example, often focus on distributing as high a share of collected revenues as possible without considering training relevance. Further, training funds tend to benefit large companies and those which would carry out training anyway, and high-skilled workers.

5. Cost-sharing – collection and allocation mechanisms
Source/stakeholders
State
(Employed) individual
Employer
State (Levy-based training funds and other public resources, ESF)
Vouchers/ILA/grants (and other subsidies)
Tax incentives
Loans (interest free loans, loans at reduced interest rates, public loans)
Saving schemes (schemes with State subsidies and/or interest subsidies)
Vouchers/grants (and other subsidies)
Social partners
(Levy-based training funds and own resources)
Allocation of public funds to SP resources
Vouchers/ILA/grants (and other subsidies)
Grants (and other subsidies) 
Cost-sharing at a glance – for further discussions

6. Thank you for your attention!