Minister rejects ILA claims

The minister for adult skills, John Healey has rejected suggestions that the Government should compensate IT training companies...

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The minister for adult skills, John Healey has rejected suggestions that the Government should compensate IT training companies forced out of business by the sudden collapse of the Individual Learning Account (ILA) scheme.

Speaking shortly before the Education and Skills Select Committee published its critical report on the ILA programme, the minister re-iterated government claims that training providers entered the scheme at their own risk.

"I do not accept there are any grounds for compensation claims from learning providers in relation to ILAs," said Healey. "Each and every one of them made business decisions for themselves about whether they wanted to build ILAs into their business plans and activities. We had no contractual relationship with them and therefore have no legal responsibility for compensation."

Training providers say they had no choice but to join the scheme, which offered the public subsidies worth up to £200 for vocational training courses. The Government abolished tax credits for people on work-related courses when it introduced the ILAs, reducing demand for non-ILA training.

"I recognise that some of them feel, because of the steps we have had to take, the financial rug has been pulled from underneath them," said Healey, but he added that trainers are responsible for their own business plans.

Although today's report does not address the legal position of the Government, it does call into question Healey's claims that the Government had no contractual relationship with suppliers.

In it MPs argued that the "learning provider agreement" would create obligations both for the learning providers and the Government.



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