Colleges fear an influx of students from the new European Union countries will stretch the further education funding system to breaking point.
Some of the former Eastern Bloc countries that are to join the EU on May 1 have been a rich source of revenue for colleges, which have been able to charge their citizens full fees for further education in the United Kingdom.
But the Department for Education and Skills has told the universities that applicants from the new EUcountries should be treated as "home students", the same status as existing EU citizens. The Association of Colleges suspects a similar ruling will be made for FE.
This would mean colleges will only be allowed to charge pound;500 a year for a typical adult full-timer, compared with the current fee of around pound;3,500, says the association.
The AoC said the fee would not be enough to meet the true costs of a significant increase in student numbers. With very little money available for growth in adult education, these fees would be unlikely to be topped up by local learning and skills councils.
It could mean that students from the accession countries, including Poland and the Czech republic, would be unable to get onto a course, regardless of their ability to pay full fees.
Rafil Star-Gandoura, international director of Derby college, whose students include Poles and Czechs, said the loss of east European adult students would affect colleges' overall performance.
He said: "These people are often hard-working and high-achievers and if a college has been used to having significant numbers of them, and that stops, then they could notice a difference in achievement rates."
The AoC warns of further problems as EU students aged 16 to 19 are entitled to free full-time education. The LSC has budgeted for 5 per cent growth for that age group next year.
The AoC says it remains to be seen whether local LSCs with large eastern European communities would be able to afford on explosion in numbers without increased funding.
Mr Star-Gandoura estimates FE gets more than pound;30 million in fees from adult citizens of the countries due to join the EU. He said: "If you have a small amount of growth you can get away with it but when it becomes significant the LSC will start to ask questions because it is not planned growth.
"Under 18, the rules of dependency come into play, so, in effect, it depends on the status of the students' parents. If they are treated as home students then they would get full entitlement.
"If you get large numbers then that will cause difficulties. We will definitely be speaking to the LSC about this."
Julian Gravatt, further education development director at the AoC, said the LSC may need to review the way its 16 to 19 funds for growth are distributed around its 47 local offices.
He said: "What this will do is create extra pressure on the system. It will test the LSC system itself, regionally and locally.
"If you take somewhere like west London, with its large Polish community, that 5 per cent for growth could be used up pretty quickly if more family members decide to come over and study."
A spokesman for the DfES said the immigration from the new EU countries is not expected to be as large as predicted in some newspaper reports.
He said: "Currently there are no plans for additional resources for 16 to 19. We don't believe the numbers will be large. Scare stories about the number of migrants should be no cause for colleges to panic."
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