All workers in England who do not have basic qualifications or skills will be offered extra training, the Chancellor has announced.
Too many workers lack basic skills, says Gordon Brown
Gordon Brown said Britain had the highest level of unskilled workers in Europe and this was its "Achilles heel".
Almost one in three employees had very low skills or no skills, he said.
He announced that a pilot scheme to encourage firms to release staff for training was to be extended nationally.
Under the scheme, called the Employer Training Programme, all employees without skills at GCSE level or equivalent will be encouraged to take up free training.
They will be entitled to time off work, with the government helping employers to do this.
In his pre-budget report, the Chancellor told MPs: "Today 30% of employees have very low skills or no skills at all.
We have the highest proportion of unskilled of any major European union country.
"For decades low skills have been our 'Achilles' Heel' as a modern economy - and the post-war 'laissez faire' training system has not, and will not, meet the skills needs of the future."
He said to extend the offer of free training more widely, to unskilled people out of work and on benefit, there would be an additional £10 a week learning allowance.
"Britain's future as a productive nation depends upon a shared determination - from parents and teachers to management and trades unionists - that the acquisition of skills by all and their continuous upgrading is a shared national purpose," he said.
In addition, Mr Brown announced that the government was commissioning a report on the country's skills needs.
He said the Chairman of the National Employment Panel, Sandy Leitch, would assess the long term skills needs of the economy and work with employers to ensure every employee is offered new opportunities.
Employers' organisations have complained that too many workers lack basic skills - but some employers are accused of failing to ensure their workers are trained.
The programme will be rolled out by the Learning and Skills Council (LSC), which ran the pilot scheme.
It says the government will invest £197m over 2006-07 and 2007-08 to fund the expansion.
Mark Haysom, Chief Executive of the LSC, said: "Gordon Brown's announcement will enable tens of thousands of companies and individuals to benefit from this targeted and tailored training scheme".