A scathing report released this week has slammed the Train to Gain scheme for poor implementation including overspending and unrealistically high targets as well as the lack of prevention of fraud.

The report, by the House of Commons' Committee of Public Accounts, found a catalogue of errors in the implementation of the £1.5bn scheme the result of which has been a £150 million under spend in the first two years followed by a £50 million over spend.

The Learning & Skills Council, which runs the scheme, denied any over spend, saying that budgets had been reorganised.

The PAC chairman, Conservative MP Edward Leigh, said: "In the face of evidence of what was achievable, targets for the first two years were unrealistically ambitious. The number of learners, the level of demand from employers and the capacity of training providers were at first all overestimated.

"By the third year, demand for training, fuelled by substantially widened eligibility for the programme and by the recession, had increased to the point where the programme could no longer be afforded.”

Commenting on the report, Richard Wainer, CBI Head of Education & Skills policy, said:"With public budgets under pressure, the Committee's findings highlight the need to achieve better value for money from Train to Gain spending.

"Too much funding through Train to Gain is focused on low-level qualifications with business deriving limited benefit. Support for employers must concentrate on delivering the skills that will drive growth and employment, with funding prioritised towards higher level apprenticeships and science, technology, engineering and maths skills to build the productive workforce we need to compete.

"Funding must follow the choices made by employers and not the need to meet centrally planned targets."

While it was damning in its condemnation of the handling of budgets, the report did acknowledge, that the programme had helped around 5% of the workforce gain invaluable skills during last year.

This is not the first time the LSC has come under fire for mismanaging a government initiative. Last year its chief executive resigned over the building colleges programme.