Undervalued, under-resourced and too often under-achieving” is how Education Secretary Charles Clarke described further education at the annual conference of the Association of Colleges. Success for All, together with an extra pound;1.2 billion of investment in further education over the next three years, are the Government’s answer to the problem.

It was an FE college principal who first said: “When Labour says education, education, education, it means primary, secondary, higher.” But it looks as though the FE sector’s time has come.

FE needs substantial new money, and a better way of handing it out, to end the “pile ‘em high, sell ‘em cheap” approach to learning. And at last this seems about to happen. The years of what successive governments called efficiency saving, and everyone else called cuts, may be over.

Clarke understands that a sector in this condition will not achieve the four ambitious objectives which ministers have set for it. Ministers expect FE to provide high-quality education and training for all young people between the ages of 14 and 19; to increase the numbers going into higher education; to help people improve their basic skills and widen participation for adults; and to help employers invest in the skills of their staff.

Hence Success for All. Sub-titled Reforming Further Education and Training in England, it was published in November 2002 after extensive consultation and offers more money and less bureaucracy. It has four themes:

* widening choice and improving responsiveness to local needs;

* putting teaching, training and learning at the heart of the reform;

* developing the leaders, teachers, lecturers, trainers and support staff of the future;

* developing a framework for quality and success.

To achieve these objectives, provision has to be planned. So strategic area reviews, carried out by the local Learning and Skills Councils, the local authority and Jobcentre Plus will determine local provision. They will assess what is on offer and what is required in each LSC area. Centres of vocational excellence will help to ensure that employers’ skills needs are met.

In the long term, the result should be that colleges will teach to their strengths. While major rationalisation of providers is not being actively encouraged, nothing is being ruled out. There is a clear demand for distinct provision for 16 to 19 year-olds, such as in sixth-form colleges or sixth-form centres in FE colleges.

Decisions will be taken on the best way to meet needs and improve choice.

National Learning and Skills Council consultation on the model for the strategic area reviews has just finished and final guidance is expected by April.

Putting teaching, training and learning at the heart of what the sector does will be driven by the Standards Unit, which has recently been set up in the Department for Education and Skills.

It will identify best practice and develop learning materials and training programmes, as well as strategies for teacher and trainer qualifications, pay, recruitment and retention.

The Standards Unit will also lead the work on leadership and professional development. It has set up a Leadership College to open in September 2003, not just for college principals but for all managers. It will be run by a consortium of the Learning and Skills Development Agency, the Open University, Lancaster University Management School and Ashridge Management College.

The Learning and Skills Council’s aim is to have good planning for the use of the extra funding. This will be carried out via a new planning, funding and accountability system, based on greater partnership and trust. Instead of receiving funds each year, colleges will have three-year development plans.

Colleges will sign up for a three-year strategy to improve the customer focus; raise standards of teaching and learning; and improve the capability of its whole workforce. The plan will have four headline targets, with annual milestones covering student numbers, learner success rates, employer engagement and increasing professional qualifications for teachers.

Colleges have to agree their three-year development plans by July 31, to come into operation in August 2003. In return for agreeing the plan, each college will get a 2 per cent real-terms increase for 2003-04. Taken together with consolidation of other streams of income into their core funding, plus inflation, plus money to cover teachers’ pensions, this gives them an additional 10 per cent.

But after that, funding increases will be linked to performance. The LSC will determine criteria for judging colleges, so that the best performing colleges receive the most. Excellent colleges - probably one in ten - will receive 3.5 per cent above inflation in 2004-05 and 2005-06.

Colleges that deliver their plans and achieve targets will receive 2.5 per cent extra and colleges giving cause for concern will be funded at inflation only rate for 2004-05. This, again, will probably be about one in 10. They will get support to improve, but reorganisation and merger are not ruled out.

Excellent colleges will include those meeting demanding targets, widening participation and implementing their plan effectively. They will also include those scoring highly for leadership and management and most curriculum areas in any inspection by OFSTED or the Adult Learning Inspectorate in 2003-04. The local LSC will assess performance to determine progress and funding rates in its twice-yearly performance reviews.

Success for All aims to create a new relationship of openness, trust and responsibility between the providers and the local LSC. Three-year funding will enable providers for the first time to plan for the medium term. It will mean an end to the system of clawing back funds retrospectively.

The LSC will also implement the recommendations of the Bureaucracy Task Force to reduce the amount of data and administrative chores required of colleges and to simplify the funding methodology.

The extra pound;1.2 billion funding over three years is the best the sector has ever received. By 2005-06, total funding for FE is set to rise by 19 per cent in real terms and by 7 per cent per student. Capital funding for buildings and infrastructure will rise by over 60 per cent in real terms to more than pound;400 million by 2005-06, compared with 2002-03.

Over the same period, funding to support the teaching and learning strategy will rise to more than pound;100 million. The devil may be in the detail, but Success for All is a welcome initiative.

KEY RECOMMENDATIONS

* Success for All to be phased in over the next three years

* Strategic Area Reviews from April 2003

* DfES Standards Unit set up to develop good practice materials and associated teacher training

* National Leadership College to develop the sector’s present and future managers

* All providers to review their mission statements

* Providers to draw up three-year development plans with four headline targets on learner numbers, employer engagement, success rates and professional qualifications for teachers and lecturers

* Providers to receive a 2 per cent increase in real terms on agreeing the development plan with local LSC

* Colleges that meet targets to receive annual 2.5 per cent increases in real terms, excellent colleges to get annual 3.5 per cent increases in real terms and poor-performing colleges to get inflation increases and intervention

* Colleges and other educational institutions to get three-year funding instead of one-year funding, with no clawback and no “efficiency gains”

* New funding schemes for work-based learning providers to be inflation proofed for three years

* Report of the Bureaucracy Task Force to be implemented in colleges and a new task force to be set up to look at red tape in work-based learning

* Selected colleges will pilot schemes to build a new relationship of mutual trust with the LSC