There, the local college is engaged in a lengthy and intensive scrutiny of options for a joint campus to be shared with Heriot-Watt University - the first such link between a further and a higher education institution in Scotland.

The news that FE colleges are to receive an additional pound;114 million by 2007-08 beyond planned expenditure of pound;506 million in 2005-06 has already been warmly received by the sector.

Colleges like Borders, facing the need for major investment in their estates, have also warmed to the announcement that capital funding is to be increased by some pound;50 million by 2007-08 - nearly half the total rise.

The college has put in a bid to the Scottish Further Education Funding Council, costing up to pound;15 million, for refurbishment and upgrading at the Netherdale campus in Galashiels which it will share with Heriot-Watt. It has also made a case for another pound;3 million of EU funding.

Both institutions are “highly committed” to the project, Bob Murray, principal of Borders College, says. But Dr Murray adds that realisation is “a long way off”. Even if everything goes according to plan, it will be 2007 before the doors of the shared campus are likely to open.

Such projects move slowly: the funding council will not give its first response until February while word from Europe is not expected until December.

Alongside that timescale, Borders will have to take its place in a long queue of colleges requiring capital investment, not least those in Glasgow which is at the top of the funding council’s priority list. Discussions in the city are proving fraught, with the latest attempt to reach an agreement among the five city centre colleges on how the money should be spent having taken place last Friday.

Developments in the Borders have also been fraught, with occasional spats between some in Scottish Borders Council and Heriot-Watt over the future of the university’s School of Textiles and Design, which it was considering moving out of Galashiels to its main Riccarton campus, on the outskirts of Edinburgh.

Having now looked at the options, the university court has overcome its initial doubts and decided on Monday that the School of Textiles should stay where it is. Its continuing presence in Galashiels, along with the university’s School of Management, will now be a powerful boost for the concept of a combined further and higher education campus at Netherdale.

The decision to opt for a refurbished facility, where both institutions will share a range of services as well as some areas of the curriculum and teaching, became inevitable after the price tag for a completely new building came in at pound;50 million. Stefan Kay, director of campus services for Heriot-Watt, says: “The key is FE funding.”

Mr Kay believes a co-location is “still some way short”, but says the prize is worth striving for. A combined FE and HE campus in Galashiels would benefit the Borders economically, meet the university’s need for a more viable presence in the area and allow the college to bring its operations together on one site.