The levy-grant system that operated under Britain's 1964 Industrial Training Act was the most effective incentive mechanism for increasing the volume and improving the quality of training. Strengths of the act's Industrial Training Boards (ITBs) were employer-funded training, collection of data on training in companies to guide planning, and improvement of traditional areas of training. However, the ITBs were relatively independent of central government interventions, resulting in the perception of interest groups represented on them that they controlled the boards; ITBs also failed to fulfill a national labor force planning function. The 1973 Employment and Training Act attempted to overcome shortcomings of the 1964 act by introducing central coordination and planning of national labor force policy. It weakened instruments for its implementation by amending the levy system and exempting small firms. Introduction of state funding made ITBs dependent on government needs and vulnerable to changes in policy, and it subordinated industrial requirements to those of the central government. After 1979, the ideological thrust of the government's policy toward nonintervention and public expenditure cuts resulted in abolition of most ITBs and reliance on firms to identify and meet their own training needs. However, the voluntary arrangements that replaced ITBs had no powers to raise a levy, no incentive or control mechanisms over training, and no information on training carried out in companies for planning. (Contains 12 references.) (YLB)