An estimated 250 million children are not learning basic reading and maths skills, according to the report, even though half of them have spent at least four years in school.

This "global learning crisis" costs developing countries billions of dollars a year in wasted education funding.

Adult illiteracy has remained stubbornly high over the past decade. In 2011, there were 774 million illiterate adults, a decline of 1 per cent since 2000. This figure is projected to fall only slightly, to 743 million, by 2015.

Ten countries - India, China, Pakistan, Bangladesh, Nigeria, Ethiopia, Egypt, Brazil, Indonesia and the Democratic Republic of the Congo - account for almost three-quarters of the world's illiterate adults, according to the report.

Globally, almost two-thirds of illiterate adults are women, a figure that has remained almost static since 1990. At this rate, the poorest young women in developing countries are not expected to achieve universal literacy until 2072.

Pauline Rose, the report's director, said literacy and adult education have suffered from neglect, as attention has focused on boosting primary school attendance in poor countries.

If current trends continue the wealthiest boys in sub-Saharan Africa will achieve universal primary completion in 2021, while the poorest girls will have to wait until 2086.

Rich countries' education systems are also failing minorities, says the report. In New Zealand, almost all rich students achieve minimum standards in grades four and eight, while only two-thirds of poor students do.

Last year a survey of basic skills by the Organisation for Economic Co-operation and Development sparked widespread debate about illiteracy and innumeracy among young people and adults in rich countries. A failure to sustain post-16 education and deep-rooted problems of poverty and social inequality were blamed by some commentators for England's poor showing in the rankings.

The NGO Save the Children said young people from low-income families in Britain were already falling behind at school by the age of seven, with most unlikely to later achieve good grades in maths and English.

The report says governments must rethink their teaching policies and redouble efforts to ensure marginalised and disadvantaged learners benefit. Governments must train teachers to support the weakest learners, as well as provide incentives to attract and retain the best instructors, it says.

Many developing countries have rapidly increased their teacher numbers by hiring people without training. This may help get more children into school but it puts education quality in jeopardy.

"What's the point in an education if children emerge after years in school without the skills they need?" said Rose.

David Archer, head of programme development at the NGO ActionAid, praised the report's attention to adult literacy and education.

"Post-independence most African governments ran adult literacy campaigns to redress historic injustices. Today there is an urgent need for new long-term investment in adult literacy programmes in order to redress the inequalities and injustices that arise from failing education systems," he said.

Improvements will come at a cost, says the report, which estimates that basic education alone is underfunded by £43 million (HK$544 million) a year.

Countries should commit to spending at least 6 per cent of their gross national product on education, the report says. Donors must increase their aid for education and sharpen their focus to support the poorest and most underserved populations. It says adult education and literacy must be on the agenda.

At the 2000 World Education Forum summit in Dakar, Senegal, six goals were set to meet the learning needs of all children, young people and adults by next year.

According to the Unesco report, no country is projected to reach all the goals, which cover childhood care, primary and secondary schooling, adult literacy, and educational equality, by the deadline.