Thoughts of the Titanic floated into my consciousness as Ed Balls, the schools secretary, announced that the government was to revamp its vocational diploma programme. This is top-deck stuff. But what is happening below? Here we see HMS Great Britain well and truly holed beneath the waterline.

Balls is right to be thinking about how best to equip young school leavers with the skills they will need for college or work. But the reform agenda must be far more radical if Gordon Brown’s government is to be the first to tackle successfully the low educational achievements of more than half of young people.

A successful academic revolution needs to begin much earlier than at secondary school exam time if inroads into widespread illiteracy and innumeracy are to be made.

During the summer, I met two groups of young people who had been pretty well failed by the education system, even though the bills met by taxpayers for each one came to around £40,000 over their school life. One group was composed of what are now termed “neets” (young people between 16 and 18 not in education, employment or training).

The government sent out an edict to abolish this group. The decree went out rather like the one made by the Emperor Augustus, that every young person should be in education, work or training. But unlike the decree by Augustus Caesar that the whole world should be taxed – and was – the neets have not only stubbornly remained but actually grown. And the strongest growth has been among 18-year-olds.

If I am honest, as I walked into the centre of Birkenhead, Merseyside, to meet some of these neets, I expected a pretty damaged and rather forlorn lot. I was in for a big surprise. Of course there was a range of abilities. Not every neet would want to come and talk to their MP. And of course the Connexions service, which helps young people find work or training, might have picked the most bushy-tailed bunch they could find, so there was some selection going on. But I was staggered by the group’s abilities.

A significant number of them had ceased to attend school by the age of 12. None of them was going to school by the age of 14. While they had some difficulty with their class work in primary school they were lost once they had transferred to a secondary establishment. Some reported they were bored with learning nothing (or being unable to learn) so they simply drifted away. Others were thrown out.

The national league tables bear out the truth of these tales. This year about one-fifth of all children left primary school to join their local comprehensive without having the requisite skills for an 11-year-old in either maths, English or science, and sometimes failing all three.

What is the purpose of progressing to the next major piece of work if one hasn’t grasped the skills necessary for the work on which one is currently involved? What’s the point of moving up to the next year if you still have to master all or most of the skills being taught for the current year’s standard?

The prime minister says that part of his big vision is to personalise public services. There is no better place to start than in primary schools.

New Dealers – young unemployed people – made up the second group I met over the summer. Like the neets many were from broken homes, but there was no self-pity. The group rolled around laughing at the idea that any government could try and lock them up in school until they became 18, an idea due to come into force in 2013.

And while their attendance record was better than the neets – just – they similarly hated school and could not wait to get out. Practically all of them spoke well of their teachers, but were contemptuous of their schooling.

The government needs a twin-track reform programme. We need to treasure the more gifted and try to establish schools that bring out the very best in this group. But we need equally to treasure those who are currently so ill served by what is on offer.

I asked the group whether there should be a general leaving certificate to test basic skills. Once this was passed, young people could leave school legally and get a job, even if they were only 14. There was universal approval for this idea: enthusiasm also existed for the idea that the money currently wasted for most of them could be claimed back in scholarships and bursaries if they decided to train for qualifications later.

This year about 18,000, 15-year-olds did not pass a single GCSE exam. Many of them would have started to fail in primary school. More than half of all young people still fail to achieve what the government deems to be the minimum satisfactory GCSE standard of five A*-C passes, including English and maths. The numbers gaining this qualification is increasing but more than 80% of young people now stay on for further or higher education.

What can be the added value of these courses when a good 30% of students involved have yet to reach the basic school leaving level? The bill placed on taxpayers for the education of young people who do not secure the minimum five A*-C grades in English and maths amounts over their school lifetimes to staggering £11.8 billion.

With pass rates at such levels, and with these large sums spent to achieve such modest ends, the prime minister should find few obstacles in his way of a truly revolutionary change in education that begins to offer personalised instead of class-based lessons.

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