In England, vocational education and training (VET) does not exist as an institutionalized system as in Europe, where specialist institutions are tied to vocational qualifications, the labor market, and long-term objectives. Education has purposes other than to provide a skilled work force for the economy. However, the relationship between education and the economy remains vital because economies depend on individuals' ability to transform new knowledge into the innovations that generate new businesses and new jobs. Education for economic purposes must provide for increased productivity; deal with new technology and new skills; show how to exploit technology and knowledge; and provide training for innovation, evolution, and changing know-how. Vocational training providers must be viewed as informed providers with their own intelligent analysis of labor markets, skills development, and economic trends in their area. The state's role in reforming VET should be more strategic than tactical; it should set the framework. The new framework that the government is proposing for VET is an opportunity to contemplate expert, modern, front-line skills delivery by providers whose core business is learning and work, providing the just-in-time skills solutions for businesses facing intense and shifting pressures. (The complete transcript of this speech is included.) (MN)