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Compares the “Payment by Results” system in nineteenth century British education with recent trends. Indicates that the partnership between the state and local authorities, which was created formerly, has been disbanded in the Government′s desire to cut costs and centralize control. Suggests that the expressed notion that internal markets can be compared with free markets is a self‐deception when Government regulates price and other variables, and concludes that Britain has a training system which is under‐funded and significantly below the standards of its competitors.

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