St Mary’s Catholic sixth-form college celebrated its centenary 12 months ago, but it will not be around to toast its 200th birthday. The college, the only one of its kind in Middlesbrough, is to merge with two local Catholic comprehensives, forming a new 11 to 18 secondary school.

Its demise, set against a backdrop of falling student numbers in the town, has not come as a great surprise. Middlesbrough, like towns and cities across the country, is facing a big decline in secondary pupils, with forecasts predicting a drop by a quarter over the next decade - from 7,998 in 2005 to 6,177 in 2015.

But, as student numbers tumble, new sixth forms and post-16 centres are entering the market. The imminent closure of St Mary’s aside, the sixth-form sector in the town has never looked so buoyant, judging by the amount of activity.

The King’s academy, one of the Government’s flagship independent state schools, opened in 2003, with a new sixth form. A second academy, Unity, is about to get funds to create a vocational centre, providing courses for 14 to 19-year-olds.

In the neighbouring borough of Redcar and Cleveland there are plans for Nunthorpe school, Eston Park school and Gilbrook technology college to share a new 14 to 19 collaboration centre, offering academic and vocational courses.

There are plans in nearby Sunderland for a new sixth-form college on the St Peter’s campus of Sunderland university. This would follow the opening of the pound;10 million Usworth sixth-form college in September next year.

It is not difficult to trace the source of the seemingly contradictory educational movements. While school rolls pre-16 drop nationwide, ministers are continuing with their crusade to create 200 academies by 2010, many of which will cater for pupils aged up to 18.

At the same time, the Government, in its education White Paper, said it would make it easier for successful secondary schools to add a new sixth form.

“There will be a presumption that proposals from high-performing specialist schools to add a sixth form will be approved,” it said.

The statement echoed the Government’s five-year strategy for education, announced in July 2004. It said that schools should be allowed to open a sixth form provided they met certain performance criteria.

Previously, schools were unlikely to succeed if there was a sixth form or FE college in their area.

This explains why principals such as Don Lillistone, of St Mary’s Catholic sixth-form college, are so dissatisfied. “It is difficult to see any coherence in the Government’s strategy,” he said.

“Allowing 11-18 academies to be established in areas with a stated pattern of 11-16 provision, and making it easier for 11-16 schools to open sixth forms, particularly in areas with a significant demographic downturn, is bound to lead to a lack of coherent planning and destabilisation.”

It is feared that government proposals, which appear to make little or no distinction between the ways local authorities plan 16-19 education, will pit increasing numbers of school sixth forms against sixth-form and FE colleges, wasting money and putting existing colleges in jeopardy.

At present, there are 1.25 million 16 to 18-year-olds in some form of education or training. Around 750,000 are in FE and sixth-form colleges, 80,000 are on college-linked apprenticeships, 350,000 are in state-school sixth forms and 70,000 are educated privately.

However, forecasts by the Learning and Skills Council, the agency that funds post-16 education, show that the student population will grow by a further 40,000 over the next three years before dipping sharply from 2009.

Three-quarters of English 17 and 18-year-olds are in full-time education or training, compared with more than 90 per cent in France and Germany.

Writing in The TES earlier this year (February 18), Sir Cyril Taylor, chairman of the Specialist Schools and Academies Trust, said if we were to match the levels of participation witnessed on mainland Europe an extra 200,000 places would be needed in post-16 education.

This is where the Government is taking its biggest gamble. If the new policy is not to trigger a new era of aggressive competition, sixth-form and college expansion must come through the recruitment of this hard core of teenagers not in education, employment or training.

Ministers have already made it clear that they see academies, including a series of 16 to 19 ones, such as that planned to open at the site of Brunel university in 2007, as central to providing some of these additional places.

The White Paper further illustrates the Government’s willingness to add sixth forms to existing successful schools. The LSC already has a budget set aside to pay for more buildings.

The mixed messages coming out of the Government continued when Ruth Kelly, the Education Secretary, said school sixth forms could lose thousands of pounds if they have high drop-out rates, under changes to funding rules.

Ms Kelly said that she was stopping the “unfair” system of allowing schools to keep the funding for students who have dropped out. Instead, they will have to complete a census return several times a year to ensure they receive money only for existing students, as happens in FE and sixth-form colleges.

This week the DfES published new guidance, outlining which schools would be given priority for sixth forms. It said high-performing specialist schools, especially those with a second specialism in vocational subjects, and those requiring no additional building work should be targeted.

Julian Gravatt, director of funding and development at the Association of Colleges, which represents sixth-form and FE colleges, predicted that as many as 50 of the new academies, not including those that are replacing existing 11-18 comprehensives, will have a sixth form attached.

He said that estimates from within the LSC say it is possible that as many as 80 high-performing secondary schools may also develop their own new sixth forms, in line with the proposals in the white paper. This would be competition particularly for the sixth-form colleges.

However, there is scepticism in the DfES about the impact of the new policy. A source close to the department said this week: “College principals were up in arms when these plans were originally floated in the five-year education plan last year.

“At the time, senior civil servants were quickly on the phone to colleges saying ‘don’t worry it is not going to be at all easy for schools to start these up’. There is still a reckoning that the number of new sixth forms will not reach three figures.”

Sixth-form college leaders will take some convincing. Sue Witham, head of secretariat at the Sixth Form Colleges’ Forum, said: “It is clear new school sixth forms will open in direct competition with existing sixth-form colleges. That will only destabilise the sector.

“How financially viable will it be? We know of sixth forms being totally supported from the 11-16 budget, and A-level classes with one or two students in them.”

John Dunford, general secretary of the Secondary Heads Association, said that to open a sixth form, schools would have to offer a full range of courses.

“To do this, they will have to co-operate with FE colleges and other schools,” he said. “There will be some successful applications, but I don’t think the number will be huge.”