If children can't read, cut the parents' benefit says Lord Digby Jones

If children cannot read, write or add up well enough by the age of 14, he says, their parents should be denied state benefits and made to live on food vouchers.

That is the proposal of Lord Digby Jones, the only person to have ever served as a minister in Her Majesty's Government without being a member of a political party.

And it is a good job that he has no political allegiance, because he is scathing about Labour's pledge of a bankers' bonus tax as the solution to the country's woes and would certainly have faced a few awkward questions were he sitting at Ed Miliband's shadow cabinet table.

He has little time for any politician who pledges low taxes and high spending and believes Labour, Liberal Democrats and Tories alike to be guilty of such empty promises.

This is Asia's century, he tells an audience of business people and academics in Wolverhampton.

The former minister for trade under Gordon Brown is adamant that there is no way for British manufacturers and service providers to compete with India and China on price alone.

But there is a problem. Kids are not coming out of school with high enough standards of literacy and numeracy.

As the 58-year-old gives his speech at the University of Wolverhampton Science Park he says he knows that the left-leaning newspaper the Guardian 'will say shame on you'.

He says it anyway.

"If children can't read and write by the time they leave formal education the teaching profession has failed," he says.

"The teaching profession will say they have kids who go home and they don't see a book again until they are back at school the next day.

"If you have kids who can't read and write to the appropriate standard by the time they are 14, you should have your benefits stopped.

"You can have food stamps. But the extra bit, the Sky dish, the fags, that stops until the kids can read and write."

Speaking with the Express & Star, he also suggests that schools could lower the age that children can leave to 14, particularly if they are disruptive in class.

"You could solve youth unemployment if the education system could send young people out of school at 16 able to read, write and add up.

"I would have them out at 14 if they want to come. Get them out into the world of work."

He says he would want them to be given some form of vocational training or an apprenticeship if it suited them better than studying in a classroom.

"Having skills doesn't mean a PhD," Lord Jones says.

His frustration at the level of 'functional illiteracy' among young people in Britain goes hand in hand with his concerns that the country must change the way it does business if it is to compete with developing countries and the new economic powers of China and India.

In his speech Lord Jones suggests that Britain is on the verge of a calamity, even invoking the image of the 'doomsday' clock used to explain how close mankind is to some form of nuclear or environmental catastrophe.

"The Guardian will say shame on you. But this is five minutes to midnight my friend.

Lord Jones believes the employers have to innovate and add value to their products and services.

"If all you compete on is price, then China will have your lunch and India will have your dinner," he says.

The 58-year-old former lawyer was director general of the CBI from 2000 to 2006. He was made minister of state for trade and investment in 2007 but did not join a political party, instead being made a life peer.

Innovation, he says, is not just about invention.

"It was a Brit who invented the World Wide Web, a Brit who invested the television, penicillin, the telephone.

"We remember how good we were at invention but who leads the world on this now? It's about innovation, taking an idea to the market."

He tells his audience that politicians of all parties in all countries have 'lied' 'every day in every way'.

And it will be those who innovate in the public sector, such as the councils now drawing up deep cuts, who get themselves back on track.

"Whether it was Conservative, Liberal Democrat or Labour, they all told us we can have it all. They told us we can have high public spending, low taxation.

"But 'vote for me and I will cut your spending' is not the greatest election slogan of all time.

"Tax the bankers? Rubbish. It will never deliver enough money. We all have to understand that the party is over.

"The public sector has to do it in a different way. There will never be the same money around. We have to cut our cloth accordingly."

He also warned about the pressures of Britain's ageing population as he made a plea for people to get the skills and training they needed to get a job and have a long career.

"If you have a system of government where you're going to be looked after for longer than you were putting into the state, you will go bust.

"People will live longer and with the scourge of dementia.

"No-one costs more to care for than a physically healthy but mentally challenged older person.

"Where are we going to get the money from? And don't say just tax bankers' bonuses. That doesn't solve it all."

Lord Jones is, however, optimistic about the future and potential of the West Midlands.

He cites the example of Jaguar Land Rover's engine plant, being kitted out just down the road from where he was speaking and where 1,400 people will work."

"JLR trust us because they have confidence that we can work more cleverly, not harder. It's world beating and it's just brilliant.

"They showed faith in the Black Country and wouldn't have come here if they didn't have it.

"The future has not been as bright for a long time as it is now. But we can't just go 'that's all right boys' and all go home. JLR and others are not running a charity."