Radical proposals to give every 18-year-old a £5,000 voucher to spend as they wish on their training or higher education are proposed in a highly critical report published today into Britain's professional "closed shop".

The report by an all-party panel chaired by the former cabinet minister Alan Milburn paints a damning portrayal of a country in which family wealth, private education and privileged access to university remain the key to well-paid professions.

It says: "There is a chasm between where we are and where we need to be if Britain is to realise the social benefits of the expected growth in 7m professional jobs in the coming decades."

The report, which also proposes a payment-by-results scheme for schools, accuses the professional classes of a "closed shop mentality" and "opportunity hoarding", so making Britain one of the least socially mobile countries in Europe.

It finds that although only 7% of the population attend independent schools, well over half the members of the professions have done so. For example, 75% of judges, 70% of finance directors, 45% of top civil servants and 32% of MPs were privately educated.

The report says one in six parents cannot get their children into a decent school, leading it to conclude: "The problem is not a shortage of parental aspiration. It is a shortage of good schools."

The trend is for professionals to come from wealthier than average backgrounds, with today's younger professionals born in 1970 typically growing up in a family with an income 27% above that of the average family.

The typical doctor or lawyer of the future will today be growing up in a family that is better off than five in six of all families in the UK. The typical journalist or accountant of the future, meanwhile, will today be growing up in a family that is better off than three in four of all families in the UK. Similarly, the typical engineer or teacher of tomorrow will now be growing up in a family that is better off than two in three of all families in the UK.

In recommendations that are likely to lead to accusations of "dumbing down", the report proposes university admissions policies take account of the social background of applicants when looking at examination results. It says there is no evidence that such admissions criteria leads to worse results.

It also suggests that part-time students should be given more financial support because they will form a growing part of future universities intake. At present they are not eligible for student loan support. Students studying from home should not need to pay tuition fees, the report says – a proposal to which the government is sympathetic. It also proposes that universities sit on the governing boards of secondary schools, and recommends that better information should be collated on the background of university applicants.

It is estimated that only 29% of students – and just 16% at the Russsell group of universities – come from lower socio-economic backgrounds, even though they make up 50% of young people.

The report proposes a revolution in training by giving learners a £5,000 lifelong individual budget, topped up by employers, which could be redeemed for apprenticeships, professional qualifications or part-time further and higher education. The aim would be to set up a truly demand-led training system in Britain.

In his foreword Milburn says: "Britain's got talent – lots of it. It is not ability that is unevenly distributed in our society. It is opportunity."

He argues that the professional classes have erected a host of new barriers to keep their jobs the preserve of the middle classes – including restricting work experience to the children of friends, internships that are only available to children in the south who have the parental wealth to work for nothing, and "qualification inflation" that prevents those without university degrees getting a job.

Overall, the report argues that the most important factor in widening participation in universities would be to improve the pass rate for five GCSEs, including maths and English, for lower socio-economic groups.

But it points out that over half of secondary schools located in the 10% most deprived parts of England do not achieve the government's official benchmark for a non-failing school, which is 30% of children getting five good GCSEs.

The report suggests: "Individual parents in areas where schools are consistently underperforming could be given a new right of redress to choose a better school for their child through an education credit worth 150% of the cost of the child's schooling."

Schools should also be given financial incentives to improve pupils' overall outcomes, the report says.

It also proposes dismantling the government's careers service Connexions, saying the panel has not heard a good word about the service, which focuses on vulnerable young people. Schools and colleges should be reallocated the £200m to provide careeers advice.

A national network of mentors to help children aged nine to 13, initially focusing on 3,000 less privileged children, is also recommended

The report was welcomed by Labour and Conservatives, but the children's department said it would have to study proposals to give financial incentives for schools based on their pupils' outcomes. The shadow higher education spokesman, David Willetts, said: "It was refreshing to read a report from a Labour politician that is not spending his time trying to draw up artificial dividing lines with the Conservatives, but instead address the issues."