Bob Beattie, chairman of the Further Education Funding Council, promised greater staff involvement in policy-making and more stability in funding arrangements.
Speaking at a conference on FE organised by the STUC, attended by unions and employers, Mr Beattie poured scorn on the grant statement issued by the Scottish Office in February. "Hardly anybody on our council could understand a single word," he said.
A policy announcement on funding in November or December, Mr Beattie told The TES Scotland later, would have to involve "root and branch" changes, albeit over two to three years to avoid sudden shifts in funding.
Detailed allocations to each college will continue to be unveiled in February, but they will be for the following academic session beginning in August not the fiscal year which starts two months later.
"This should allow colleges to plan ahead with greater confidence," Mr Beattie said. The council officially takes over responsibility for FE from the Scottish Office in July and its first grant settlement will be for 2000-2001.
The chairman also criticised as "not very clever" the system where college funding is based on student numbers from two years previously. Under the new regime, grants will be based on performance targets, including anticipated student enrolments.
"If these targets are not met, we will simply claw the money back," Mr Beattie said. "But you can plan on that basis and budget for the fact that you might be clobbered."
In another concession to critics of the funding system, Mr Beattie promised more "transparency" in how grants are calculated. "The first requirement is that people should at least be able to understand the grant letter," he said. "Colleges should know why one is getting X and another is getting Y. They may not like it, but at least they will understand it."
Mr Beattie held out an olive branch to the unions, saying continuing dialogue is essential. He revealed that the council will canvass opinion from lecturers, support staff and management in a comprehensive effort twice a year.
His remarks were warmly received by employers as well as unions. Ronnie Smith, general secretary of the Educational Institute of Scotland, said:
"More transparency, openness, accountability and information are essential and that requires someone to take a grip so we can re-create the national sector FE once was. If the colleges are going to have to promote social inclusion as their contribution to lifelong learning, let us start with staff inclusion."
Tom Kelly, chief officer of the Association of Scottish Colleges, applauded more precision in FE funding. "It is vital that development plans are not hurriedly assembled at the last minute when you finally know the details of your funding arrangements."