The Department for Education (DfE) has said that all students without a grade C or above at GCSE in English and maths should continue to study the subjects in post-16 education.
The announcement could see an increase in teaching vacancies for the subjects as the full-time education leaving age is raised to 18 by 2015.
Currently around one-fifth of GCSE students get a "near miss" (a D grade) in the subjects and under the proposals they will be given additional help and support to re-take the exam at the next opportunity.
Others will receive more intensive teaching over a longer period, with the possibility of additional qualifications to act as stepping stones.
Schools Minister Nick Gibb said: "Too many young people are dropping English and maths before they have secured a good grounding.
"We need all our young people to be fluent and comfortable in these basic skills."
Following a consultation on post-16 education funding, the DfE have proposed an overhaul of the system aimed at simplifying funding and encouraging students to study subjects that are more likely to lead to a university place or skilled employment.
The Conservative MP added that the reforms would ensure that young people were provided with the information needed to take courses of value, enabling them to broaden rather than narrow their options.
Contributing to the consultation, the annual skills survey conducted by the Confederation of British Industry (CBI) this year revealed that more than two-fifths of employers were dissatisfied with the levels of basic literacy and numeracy displayed by school and college leavers.
The consultation also heard recommendations from Professor Alison Wolf, who in a review of vocational education found that some 300,000 16- to 19-year-olds were taking qualifications of little benefit to them.
Professor Wolf said: "The Government’s proposals recognise that maths and English are the most important vocational as well as the most important academic skills of all, and critical to young people’s success in life."
Posted by Theo Foulds