A “streamlined” Learning and Skills Council with tougher powers over failing colleges and free training for under-25s, are among the measures in the new Further Education and Training Bill.

Young people aged 19 to 25 will be entitled to free tuition for a first full Level 3 qualification (A-level equivalent) from summer 2007, in a bid to tackle skills gaps.

Meanwhile tough measures will be taken to eradicate under-performing colleges, with new powers for the Learning and Skills Council (LSC) to remove the heads of FE colleges deemed to be failing.

While there would be help for under-performers, Education Secretary Alan Johnson told a conference of college leaders he intended to wipe out failure by 2008.

The Bill, announced in the Queen’s Speech last week, also gives colleges the power to award foundation degrees.

The LSC restructure will see an end to the current by 47 local LSCs, creating nine regional councils and a reduction in the size of its national council.

Chris Banks, Chair LSC said the changes would: “Enable the LSC to reinforce its role as a strategic partner and “market maker”, recognising success while driving out poor quality, to the benefit of employers, individuals, communities and the economy.”

John Brennan, Chief Executive of the Association of Colleges (AoC) welcomed the new powers to create and validate Foundation Degrees and to free-up LSC structures and operations “so that decision-making is closer to the front-line.”.

However, while employers' group, the CBI welcomed the Bill as a step in the right direction, it urged the Government to go further.

CBI Deputy Director-General John Cridland said: “Only 20% of adult funding is demand-led and on the Government’s own projections it will take until 2010 to reach 40%. Ministers should channel funding directly to the providers – public or private – who best meet employers' needs, rather than providing ring-fenced funding for colleges and college-provided courses.”

Related story: CBI Brands National Skills System 'Irrelevant'.