Since it’s budget time next week and everyone I know thinks we are fated to have an announcement around Individual Skills Accounts (ISAs) I thought I would give a little bit of prominence to the two countries there that have been most active this area recently and talk about their experience.  And so, today, I’ll be talking about Singapore and tomorrow, France.

The reason Singapore is getting a lot of attention these days is because of something called SkillsFuture.  This is a brand name for a whole host of programs including career advising, some modest scholarships, and the like, but the big-ticket item is a SkillsFuture Credit, an annual $500 credit for every adult Singaporean aged 25 and over, which can be used for eligible skills-related courses throughout the country (they cannot be used at overseas institutions, although they can be used for some of the big MOOC providers like Coursera and EdX.).  The credit can be carried forward from year to year and works essentially as a voucher – the government pays the amount to the provider once the learner enrols in a course.  Last fiscal year, 192,000 Singaporeans chose to use their credits for various purposes, which is roughly 8% of the eligible population.  The most common use of the program, particularly among over-40s, was to improve IT skills (an outcome which might please the current cabinet’s coding-obsessives).

At one level, we can see this as a particularly ambitious ISA program, and for that reason it might be considered an obvious model for the Government of Canada.  But before everyone gets too excited about Singapore as a model, it’s important to understand that this program is not a one-off and is embedded in a very deep and complex system.

First, this is only a very small part of the Government of Singapore’s skills efforts.  This is a universal program, yes, but it’s built on an earlier (and still extant) skills program which targeted employers rather than employees.  Initially this was run as a training levy, much like Quebec’s, in which companies were required to pay a payroll tax, but could reclaim it if they could demonstrate training expenditures.  More recently, this has morphed into another program called “Enhanced Training for SMEs”, which involves straight out subsidies for Employer-directed training (think of it as a Canada Jobs Grant on steroids).  It’s therefore fair to Singapore thinks of ISAs – subsidies for learner-directed courses – as a small add-on to the much larger scheme of subsidized employer-directed training.

Second, the level of control Singapore exercises over the selection of eligible courses is thousands of miles beyond what any provincial government – let alone Ottawa – has ever really attempted.  The government literally approves every single course – not degree, not certificate, but course – which is eligible for the program (directory here, if you feel like browsing).  Part of the reason they can do this is that it’s a small country and there aren’t that many providers, which makes monitoring a less ludicrous affair than it would be in a huge place like Canada.

But there’s another factor at play here, and that is the Singapore Skills Framework.  Now, you have to hold on to your hat here, because what I am going to describe is almost unimaginable here in the Great White North.  The Singapore Government has created skills frameworks in a dozen or so broad industry fields (eventually, this will expand to 23 to match the Government’s 23 separate Industry Transformation Programs, which are so mind-boggling I’m not even going to bother to describe them).  In each framework, the government, with input from industry, has created a set of model industry-wide career pathways, model industry-wide occupational job descriptions and the skills profiles to go with them, which means they can also come up with some clear training pathways into jobs.  And it is these pathways which allow the government to simply and easily designate which individual courses are eligible for the credit. 

All this vastly magnifies the effectiveness of an ISA program.  The fact that individual courses are matched up with specific skills on specific career pathways in effect makes each course its own microcredential with a clear labour market value, meaning it’s more likely that individuals will find value in courses worth $500 or less. That’s not true in Canada.  The fact that each course is approved in advance and is delivered by trusted (mainly public) providers means government has a better sense of quality control than in a program where provision controls are weak.  That almost certainly won’t be the case in Canada, where a lot of the money from these kinds of schemes tend to end up in the hands of low-quality private providers (there were many examples of this from the 1990s, like the Atlantic Groundfish Strategy in Newfoundland).  

In summary, Singapore has a highly-developed skills system, of which the SkillsFuture Credit is but one small part.  It’s a source of inspiration, but the likelihood that a Canadian knock-off would be anywhere near as successful is pretty small.  The Singapore system, for a variety of structural reasons, is likely to produce much better quality and value for both workers and government.  If the Government of Canada really wants to go down this road, it would be worth thinking not just about ISAs, but all the surrounding enabling mechanisms that make ISAs valuable.

Tomorrow: France.