The ideas, from an action group set up by Welsh Office ministers a year ago, aim to break down the barriers between school sixth forms, further education colleges, local authority adult education and training and enterprise councils.
The action group also wants 'to ensure that the needs of employers and the virtues or enterprise culture are better transmitted into the arrangements for academic and vocational education'.
The group's report calls for the creation of bodies known as Community Consortia for Education and Training in Wales, under the control of the Welsh assembly. They would be responsible for integrating funding of all publically-funded, post-16 education and training programmes.
As a first step, the action group wants schools and colleges to form partnerships aimed at sharing facilities and broadening choice. They would have a£1m-£2m fund to help establish joint courses.
The group proposes three options for overseeing the new system. Its favoured one is yo create a council for education and training in Wales that would replace existing bodies for colleges and Tecs.
Its reports will go out to consultation before a final version is published next March. It will then be for the assembly to decide on its recommendations. The report calls for the plans to be implemented before the start of the 2000-01 academic year.