In 1997 Tony Blair declared his three priorities to be “education, education, education”. It is a pity that he did not make them “skills, skills, skills”. Despite all the investments made by Labour - the state now spends £5 billion a year on adult skills - millions of workers lack basic abilities. Five million are not functionally literate. One in six lacks the numeracy expected of 11-year-olds.

The failure to overcome the chasm in skills is an indictment against any government committed to fairness. Long-run economic growth is inhibited by a paucity of skills. But, more importantly, being unskilled lowers resilience, saps wellbeing and corrodes life chances. The vast army of unskilled workers in our nation is a moral crime as much as an economic waste.

One of the tests of a civilised society is that it thinks beyond its productivity. Let’s say Mike, in his fifties, is illiterate and wants to learn to read and write. Any humane society would make the investment even if it knew in advance that this would not result in his being able to get back to work or spend more money - in other words “to add economic value”. Mike’s life might not add anything to the nation’s GDP but it would be a better life.

The tragic paradox is that the people who do receive training are the ones already with higher levels of skill: 40% of graduates get some training each year, compared with just 10% of workers with no qualifications.

The labour market exacerbates the inequalities of learning. Politicians often blame employers, but the hard truth is that, from a purely commercial perspective, it makes more sense to spend money on additional training for quick-learning, highly qualified employees.

So it is wrong to suggest that the skills gap results from a “market failure”. The market fails to deliver a more equal society, for sure - but that’s not what markets are for.

If markets cannot magically dissolve the skills gap, successive state-sponsored bureaucracies have also failed to deliver. The institutional architecture of skills is hardly straightforward. The UK Commission for Employment and Skills has replaced the Sector Skills Development Agency and now the employer-led Sector Skills Councils set the agenda for different parts of the labour market.

A morass of agencies creates plenty of jobs for experts in skills policy but little opportunity for the unskilled.

If we want to tackle inequality in skills, a number of measures are needed. First, individuals should be given their own “skills accounts” with wide discretion about how the money in them is spent. The new adult advisory service should advise people on how to use this money, following the highly successful model of giving the recipients of social care control over their own budgets.

The government is now piloting individual skills accounts but fears a repeat of the disastrous Individual Learning Accounts scheme, which resulted in widespread fraud. Yes, ILAs were poorly executed, but the principle behind them was sound. It is time to move on.

Second, employees should be given more right to training. It may not be in the immediate financial interests of firms to give staff time off for training, so if we want people to have more choice, more regulation is inevitable. The new “right to request” time for training is a welcome step, but a right to have time to train should follow quickly.

Third, skills acquisition needs to be more closely integrated into welfare reform measures. The government is rightly asking more of both welfare recipients and welfare providers, but there should be rewards for helping people into training as well as for helping them into work - especially as the economy tips into recession.

The skills gap is not a new problem; policymakers were worried about it in 1850. Nor is the failure to find a solution. The last Conservative government’s Youth Training Scheme (YTS) was lamentable.

Bold action could unquestionably narrow the skills gap. The political problem is that most journalists, most politicians and most policymakers don’t live in the world of the unskilled. The funding of universities is a much hotter topic in Westminster because MPs are graduates with graduate children.

David Lammy, now minister for higher education but previously in charge of skills, is one of the few politicians who gets genuinely angry about the skills gap and many of the modest improvements of recent years took place on his watch. But generally any debate containing the word “skills” invokes either a yawn or a sigh.

The failure on all sides of the political divide to tackle the evil of ignorance is thus a failure of democracy itself.

Richard Reeves is the director of Demos which last week published The Skills Paradox www.demos.co.uk