In an unprecedented move, more than half of colleges have opted to go their own way on pay this year, with the majority claiming they have no money to fund the recommended 2.4 per cent rise negotiated with unions.
Instead, a survey by the lecturing union NATFHE shows many are imposing pay freezes or much smaller increases, with the possiblity of more cash only if enrolments meet targets.
The TES autumn survey of national FE student enrolment trends shows little is likely to be left in college coffers to meet such settlements, as they either offer courses at give-away prices or batten down the hatches and aim for zero growth.
Lecturers, who feel they deserve recompense after colleges met tough growth targets while achieving 30 per cent efficiency gains, have been left feeling badly betrayed. Most have relinquished favourable local authority contracts in favour of new local deals with inferior terms, only to find their pay packets reduced.
Morale in the sector has been worsened by increasing casualisation of part-timers as colleges turn to lecturing agencies to save cash.
Colleges' determination to hold down pay comes at a time when the Government is trying to impose a pay "freeze" throughout the public sector for the fourth year running, insisting that increases can only come from efficiency savings.
Lecturers' leaders fear that, with a general election looming, their members will lose out to higher profile groups like schoolteachers and nurses.
Teachers this month submitted a claim for an above inflation rise. cuts. Last year FE, the so-called "Cinderella sector" was told it must grow by another 11 per cent with a funding increase of only 3 per cent.
NATFHE, which is now likely to use national pay talks merely to try to establish a minimum "safety net" figure, said pay scales for FE lecturers were now "fragmented beyond recognition". The breakdown would have disastrous consequences for recruitment of new staff, compounding the problems caused by a widespread exodus of older staff because of rock-bottom morale, the union said.
Research by NATFHE found FE lecturers' salaries have slipped well behind those of most secondary school teachers in the past decade, reversing the traditional relationship.
Unlike lecturers, schoolteachers' annual pay increase is determined by a national pay review body, and schools are obliged to find the cash. Though certain to be dissatisfied with next year's settlement - likely to be between 2 and 3 per cent - teachers viewing the plight of lecturers will be warier than ever of any Government moves to bring in local bargaining in the schools sector.
Lecturing staff hit by pay freezes or conditional rises will find no comfort from the new body representing colleges.
The Association of Colleges, placing itself firmly in the employers' camp, is in favour of college-by-college settlements, dictated by ability to pay, said chief executive Roger Ward.
However, he denied national bargaining would founder, claiming colleges wanted to see a centrally-agreed pay recommendation though they would "increasingly opt for the freedom to say whether or not they will implement it".
NATFHE negotiating secretary Sue Berryman said the speed and scale of the break-up of common pay arrangements had been shocking.
Union sources suggest its role in annual pay bargaining will now amount to trying to secure a minimum pay safety net for staff.
Enrolment, FE Focus page 27.