The government's adult learning scheme is not doing enough to help people read, write or add up properly, inspectors say.
Record numbers of people have returned to learning
Ofsted inspectors say the programme has recruited record numbers of people onto courses, but the teaching is often not good enough.
Inspectors looked at courses at 600 centres - including colleges, job centres and prisons.
They say tutors in prisons and job centres were often great at inspiring people but not so good at teaching them the three Rs.
The government launched its basic skills programme three years ago, reporting that seven million people in Britain were "functionally illiterate".
In part, the study suggests the scheme is a victim of its own success because so many people signed up for courses there was a shortage of properly qualified teachers.
Ofsted chief inspector David Bell said: "Far too many young people reach the
end of their compulsory schooling with inadequate basic skills.
"For them further education provision represents their best chance of access to
opportunities the rest of us take for granted.
"There are seven million adults in this country who have inadequate basic
"They represent the greatest single failure of the education system."
The government says it is taking the
"first ever comprehensive approach" to tackling what was a long-standing
A spokesman for the Department for Education and Skills said" "In just two years, over 1.8m adults have started basic skills
courses, and 400,000 have achieved key qualifications.
"The Ofsted report highlights examples of very good provision across all
sectors, and is positive about the direct provision of literacy, numeracy and
language courses, particularly through Further Education colleges.
"This is where the vast majority of learners receive their basic skills
teaching, and where the greatest expansion in basic skills is taking place.
"New teacher training qualifications and continuing professional development
programmes are already under way to address the shortcomings the report
identifies in "work-based learning" basic skills teaching.
The study was carried out by Ofsted and the Adult Learning Inspectorate.
The Association of Colleges - which represents further education colleges and sixth-form colleges - says the report highlights the significant contribution by colleges in attracting more adults than ever before back into colleges to improve their basic literacy and numeracy skills.
The organisation's director of curriculum and quality Judith Norrington, said: "We are delighted to see praise for the hard work of the colleges in bringing people in the community back into the learning environment.
"The report praises the DfES for its strategy in attracting new learners. It would have been nice to see equal recognition for the colleges and others who are, after all, the ones who actually recruit and support learners.
"We recognise that there are still not enough trained staff to support this significant area. But this is a shared responsibility. The standards for teaching of basic skills have, after all, only just become available."
The shadow education secretary, Damian Green, said: "This is another initiative which has failed to progress from the eye-catching press release into an effective policy.
"Until the government recognises that it needs to solve the basic skills problems caused by disengagement from school, it will continue to fail our most vulnerable members of society."