Sir David Normington, the Permanent Secretary at the Department for Education and Skills, said that he understood employers’ charges about the poor standards of literacy and numeracy among employees, having come across the same problem himself.

Despite soaring A grades at GCSE and A level, businesses have repeatedly expressed concerns that too many teenagers leave school without being able to read, write and count properly. Nearly half (46 per cent) of students this year failed to get a grade C or better in GCSE maths and 40 per cent failed to reach a C in English.

“As an employer, I sometimes see that the standards of English and maths are not good enough among those coming into my employment,” Sir David told the Commons Education Select Committee.

He insisted, however, that standards were rising because of extra investment in education. “At every phase, from Key Stage 2 [11-year-olds] to 14-year -olds and GCSE, standards have and are improving,” he said. “But it is not good enough yet. I accept that and employers are not seeing enough of it.”

The Confederation of British Industry estimates that 15 million adults do not have the arithmetic skills expected of a 14-year-old and that one in ten adults cannot read to a similar level. It has consistently campaigned for pupils to be taught better basic skills and says that standards are so low that a third of employers are currently forced to give new staff extra classes in English and maths.

Sir Digby Jones, the Director-General of the CBI, said yesterday that he admired Sir David’s candour but urged action: “The CBI welcomed the Government’s pledge of a ‘relentless drive’ to raise standards but there has been no clear action to back up the promises of February’s education White Paper. We need to see action as well as words — business will do its part in ensuring that Government knows what skills employers need.”

Sir David told the Labour-dominated committee that the Government’s forthcoming White Paper would tackle the continuing high drop-out rate of 16-year-olds from school and would focus on improving education for 11 to 19-year-olds.

David Cameron, the Shadow Secretary of State for Education, said that Sir David’s comments were “the biggest admission yet that the Government is still not getting the basics right”.

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