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Thank you, it’s a pleasure to be here.

It’s good to see an event celebrating employers and UKCES working together.

And a livery company is a good place to do it. Because these guilds tell the history of our economy.

From the medieval trades - fletchers, cordwainers or girdlers - through the early modern clockmakers, spectacle-makers - and the playing-card makers, obviously - down to the 20th-century companies of actuaries, consultants and bankers.

And the newest company of all, just a year old, is the Worshipful Company of Educators.

That couldn’t be more appropriate.

Because employment is at a record high, we’re set to grow faster than any advanced economy this year, and wages are rising faster than inflation.

And if we want to make the most of that - we need a strong education system.

People need the right skills to get jobs. And employers need skilled people to grow.

If we’re to do that, we face 2 challenges. I want to talk today about what we’re doing to rise to them.

The first challenge is the divide between academic and vocational education.

And the second, the divide between education, and work.

The divide between academic and vocational education

Taking the first - the issue is partly about attitudes.

We still hear talk of children being ‘non-academic� or as ‘unsuited� to vocational careers.

But any employer will tell you good literacy and numeracy are the most basic requirements for any employee.

So it’s just wrong to say a technical education is an opt-out of high standards.

And it’s just wrong to say high standards are somehow irrelevant to workplace skills.

I defy anyone to find any good job that does not need a combination of knowledge, skill and behaviour. We must equip young people with all these.

But even worse than the mindset - the divide was a matter of policy, too.

Vocational courses had no minimum standard for English and maths.

And governments tried to run a skills bureaucracy from the top down - deciding who should study what, at each level and for how long.

It was cumbersome and clumsy: and it failed.

By 2010, somewhere between a quarter and a third of all young people were on poor-quality qualifications.

Hardly surprising, then, if vocational routes lost value and status, compared to academic.

…which we want to end

We are determined to end this divide - by restoring rigour, across all education.

Now, regardless of whether they’re in school, college or workplace training - all students will now study maths and English right up to 18, to at least a C at GCSE.

And look at some of the new institutions we’re creating.

Since January we have announced new colleges, in important sectors like rail, nuclear and software.

These will be elite institutions, and they will blur the lines between vocational and academic.

They will provide relevant, technical skills - alongside top-quality academic study.

They will take students on from a young age - but go right up to university level.

They aim to be the best in the world - so they are not just an alternative to the best universities, but are elite peers, collaborators and competitors, too.

And today I can announce that we’ll be setting up the first new FE college for over 20 years.

Prospects College of Advanced Technology will involve employers as never before, providing cutting-edge technical education in engineering, aviation, rail and construction to young people over 16.

When it’s fully up and running, it will serve over 1,000 students and 1,200 young people on apprenticeships - making it one of the largest group training associations in the country.

Parity of esteem is a nice phrase: these colleges will make it a reality.

And just as technology has transformed industry after industry, it’s coming to education. New assessment, learning and planning tools can help refine teaching - making it more measurable, and driving up standards.

So we set up the Education Technology Group - alongside a group for FE, and new capital funding for broadband in colleges - to explore what more we can do.

And at every level, we are restoring faith in vocational qualifications.

We’re stopping funding per qualification passed - which encouraged chasing easy certificates. We’ve introduced grading to all apprenticeships. It’s absurd to say there aren’t different levels of ability for vocational skills: anyone who saw my welding at the Skills Show a few months would agree.

Grades must be valid, of course - but no skill can’t be graded. And in time, we want grading across the system - for better, finer measurement of achievement, and for clear, aspirational goals for students.

We’ve filtered out poor-value qualifications: over 6,500 will have funding removed.

The qualifications recognised in performance tables will be those explicitly supported by universities and employers.

That means employers can trust qualifications.

And it means young people face smarter choices, and better prospects.

And they’re starting to notice. We have a record number of young people in apprenticeships. The majority of young people say they want to do an apprenticeship when they leave school. The top apprenticeships are already as competitive as the top universities.

That’s promising. But we want to go further. And our reforms aim to create a new norm: where young people choose university or an apprenticeship - where we end the divide between academic and vocational education.

The divide between work and training

Turning to the second divide: there’s a gulf between work and education.

Again, this was a matter of mindset and a product of policy.

As governments thought they knew best, vocational courses lost sight of the needs of business, and academic courses lost sight of practical context.

Now, we’re making the entire system much more responsive to employers: Tech Levels, yes, and new GCSEs in English and maths which will be much more functional too.

This link between work and education must be based on stronger qualifications, and it can be helped by stronger relationships too. We’re strengthening careers advice - so that it’s more inspirational, with a more dynamic, refreshed National Careers Service coming this autumn.

Our guidance to schools is much firmer about the need to engage employers. No school now has an excuse not to be engaging local employers. And no employer has an excuse not to engage their local school.

And we know some young people aren’t ready for work, or a full apprenticeship. So we created traineeships - to ease that transition.

Just this week, we had a trainee, Yusuf, start in my office in Parliament - and several other MPs have taken on trainees, too.

We’re giving genuine power to employers to shape training: like our apprenticeships trailblazers, who are writing the new apprenticeship standards.

Employer-owned pilots

And today, I am delighted to announce the next stage of our employer ownership of skills pilot.

Under this scheme, employers combine their own money with government funding, to invest in the training they need.

It’s simple, direct, and focussed.

The second wave of funding started last year. Figures released today show that the first projects will create over 5,000 traineeships.

Like National Grid - who plan to provide over 3,000 - or Everton Football club, who plan 1,600 - though let’s hope that after Everton, the trainees have better careers than their former managers.

Today, I can announce the next projects: an extra £5 million going direct to employers.

Companies like Kostal, leading a new advanced manufacturing programme in Sheffield; Blackpool Pleasure Beach, investing in tourism training; and Freedom Communications in Watford, in business technology.

These companies know their training needs best: so now, they get the budget.

We’ve learnt a lot from the first rounds of funding about how to support employers. And we know that some sectors have specialist skills.

Like the automotive sector - a great British success story of recent years.

So I can also tell you that learning the lessons from EOP, we will establish a new permanent employer-owned fund and are making the first call for applicants, for companies in the car industry supply chain.

From next week, they can submit proposals to get money to train - to tackle skills shortages, and go on to ever-greater things.

We will make £10 million available immediately - and will offer a further £10 million later in the year.

I know you’ve spent time today showing what employers can do when they get directly involved in training. That’s exactly the spirit of our reforms � and these new announcements aim to find, fund and fuel even more.

Conclusion

So that’s what we want.

To end the divide between vocational and academic. It’s a false divide: only rigour in both will help our young people.

And to end the divide between training and work. It’s a dangerous divide: only responsiveness will help people get jobs, and help employers grow.

And if we can do that - think of what’s possible.

What livery companies may come in the future, no one can say.

But I hope that if we’re in this hall in 10, or 20 or 30 years, we’re still talking about the success stories of this decade - of a time when we ended the divides that have held us back.