As Richard Caborn, Labour’s minister for the regions, does his rounds of regional government offices this summer to gain views on the recently published Government’s consultation paper on regional development agencies, he might ponder on the extent to which he is meeting representatives of a forgotten but major British industry.

The 514 colleges in the further education sector in England and Wales spend Pounds 3.2 billion a year on the development of skilled people and competitive businesses - particularly small and medium-sized enterprises - and act as a major employer of over 200,000 full-time equivalent staff. This industry is also a major purchaser and developer of land, manager of facilities and consumer of products and services.

These are some of the findings of an important piece of strategic research commissioned by the Further Education Development Agency to map and support the roles that FE colleges are currently playing in the broader aspects of economic development on local, regional, national and international levels.

The point is this: to see FE simply as one of a number of local providers of education and training is to underestimate grossly the actual contribution that the sector is currently making to broader aspects of economic development and competitiveness - let alone its potential contribution. Put another way, there is an economic development party going on and FE has not been invited.

Make no mistake, there is a major opportunity here that should not be missed by either FE or the potential regional partners. The advent of regional development agencies should be welcomed in that they offer the opportunity for regional coherence as opposed to the fragmented array of development initiatives and funding regimes that FE is heir to.

And this is not simply a territorial issue as FE institutions, higher education Training and Enterprise Councils and local authorities manoeuvre for position as a result of the general election. It is about the true partnership between a variety of local and regional organisations envisaged in the Labour party’s original Millan Commission report on regional strategy and articulated in the vision for regional development agencies: “The task of RDAs will be to co-ordinate regional economic development, to help attract inward investment and to support the small-business sector. It will be an important job to bring together the various regional organisations and help them to work together to ensure that the regions gain the greatest possible benefit from their efforts. ”

So far, so good. However, the consultation makes specific references to HE institutions and a possible role for the FEFC but none to FE colleges themselves, even though we have evidence of a major contribution that FE is making on a regional - not just a local - level to small-business development and inward investment in particular.

The FE sector is in a prime position to take its rightful place with others in closing the gaps between job creation, labour market intelligence and labour supply. An approach to regional development which misses the opportunity to work with FE in this way will not be as effective as it could be.

It is reassuring to note the extent to which the FE colleges are beginning to group themselves on a regional basis in order to provide the input that they and successful regional development agencies are going to need.

The less reassuring news from our initial findings is that only 80 per cent of FE colleges - and in some regions, as low as 50 per cent - see economic development as a strategic management issue that they should be addressing.

What we need to do is to change the mind sets all round. We need to help hard-pressed principals in FE colleges to see that there is a different view out of their office window - the perspective of major economic player, employer and corporate citizen.

After all, 60 per cent of colleges to whom we spoke were in the top ten largest employers in their area, and we have an example of a college in the northwest that is putting Pounds 950,000 of income a year - in terms of employment and purchasing - into a single postcode area. It will not be the only one either.

However, we also need to stop seeing FE colleges as “merely” local providers of education and training, and recognise them as the major regional economic development partners they are. It is vital that Mr Caborn gets that message.

Simon James is head of learning at work for the Further Education Development Agency