However, much more training is needed for teachers before the widespread introduction of diplomas for 14 to 19 year-olds in September, inspectors concluded. Concerns about future funding and the reluctance of some schools to develop links with colleges also need to be tackled, they said.

The findings come from a study of further education colleges recognised as ‘centres for vocational excellence’ and their work in supporting 14- to 16-year-old pupils in local schools. The colleges share specialist equipment with schools, helping to improve pupil motivation and attendance, inspectors said. They also offer a wider range of courses.

Many colleges subsidise their work with schools and many were worried this would not be sustainable in the long term. The money they receive through the “increased flexibility programme” for 14 to 16s, often falls short.

Ioan Morgan, principal of Warwickshire college, said: “We have 1,000 14-year-olds coming to us every week. The schools pay us a fee but it does not cover the true costs of teaching the pupils. We justify it because around 70 per cent of those pupils come to us full-time at the age of 16.

Lots of pupils are motivated by vocational courses, when they might otherwise drop out of education.”

Ofsted said that the Government and the Learning and Skills Council should review the funding of joint programmes between schools and colleges to make sure it can be continued and is fair.

They also recommended that colleges and schools do more joint staff training to prepare for diplomas. Timetables need to be better harmonised to make more courses available, they said.