The Association of Scottish Colleges has been outraged to discover that Pounds 4 million of the Pounds 7 million extra expected from the Scottish Office in the next financial year is being earmarked for the seven further education colleges involved in the University of the Highlands and Islands project.
Tom Kelly, the association's chief officer, hit out at the "miserly" Pounds 3 million remaining to support mainstream growth in FE.
Colleges maintain that with student activity up 8 per cent to 9 per cent and a continuing requirement to make economies the result will be a reduction in funding. The Scottish Office says the extra money is to allow expansion of degree-level courses as part of the Highland project, which has the enthusiastic backing of the Scottish Secretary.
These courses are capped in other colleges to reduce costs and prevent colleges drifting from their "vocational mission".
Mr Kelly, a former senior official in the Scottish Office, accuses the Government of having no effective policy and points to the "sharp contrast" in ministers' handling of the colleges and universities which have been relieved of the need to make "efficiency gains" next year. This has resulted in higher education being given Pounds 15 million more than planned.
"The Government is not exactly giving reward for virtue," Mr Kelly said. "Ministers say they want student growth and efficiency and we have given them both, yet our funding is being reduced. The HE sector has under-recruited and shown much less improvement, yet they have been given more. We are not encouraged."
The colleges also claim these funding decisions are undermining the Government's own "competitiveness agenda". The ASC points to the findings of the national skills audit, showing there is no shortage of university graduates while there is a real deficit at sub-degree craft and technician levels. "There is a mismatch between policy requirements and funding decisions and that is putting it mildly," Mr Kelly commented.
He added: "This underlines our contention that you get more for your bucks if you put money into FE and you get more bucks for what you want to do if you put more money into FE."
A Scottish Office spokeswoman said the overall level of support for colleges would allow them to continue to increase student numbers and invest in new technology.