Colleges need to massively boost spending on computers if they are to meet the most basic needs of students, research by independent management consultants has revealed.

A survey of colleges by Coopers and Lybrand shows that the range in capital spending on information technology per student was Pounds 3 to Pounds 73 last year. Revenue spending varied similarly from Pounds 7 to Pounds 151 a head.

Three-quarters of colleges planned major investment and improvements in IT. Almost six out of ten (58 per cent) had three-year plans, while a fifth (21 per cent) had strategies up to the year 2000.

But Chancellor Kenneth Clarke’s Budget which demanded a Pounds 100 million cut over three years to capital funds will force them to radically reduce their spending on IT. The cut is seen as a major blow to providing the skills industry needs.

Lewis Derbyshire, policy adviser for the Association for Colleges, said: “I can’t see how colleges can maintain the quality of service they are offering now and make that kind of cut.”

Howard Clarke, the chairman of the Sixth Form Colleges Association, said: “We are very concerned. If the Government’s Private Finance Initiative can’t fill the gap in the short term, one can make use of reserves. But long term it will have to come from recurrent spending.”

Ministers gave colleges a pledge before incorporation that capital spending would be sustained or increased.

A survey by the National Council for Education Technology, to be published in the spring, shows the extent of college managers’ expectations. Of the 215 colleges responding to the survey, 42 per cent were expecting growth a 10-20 per cent growth in capital cash. One in five expected rises of up to 50 per cent.

Meanwhile the Coopers and Lybrand study of 21 colleges stresses the need for more cash but says it can be better spent. Mark Mower, author of the report, said: “Research suggests that there are wide differences in the economy, efficiency and effectiveness being achieved by colleges in the area of IT support.”

Help may come by having more co-operative ventures. The FEFC’s technology committee, chaired by Sir Gordon Higginson, will shortly publish its long-awaited report. It will call for a collaborative, nationally-organised system in contrast to the current market approach of bidding for cash.

The report will propose a five-year plan for IT throughout FE, including staff development, specialist information and advisory centres and a communication network similar to higher education’s Joint Academic Network (JANET).

The Coopers and Lybrand study suggests that fewer than one in 20 (4.7 per cent) of personal computers are linked up to local area networks.

Many colleges have developed a hard-nosed attitude towards those who use the technology in an effort to secure more cash. Eight out of ten colleges expect students to pay for laser printing and more than half for colour printing services.

But this is no substitute for the the Pounds 100 million missing from capital budgets.

In January, when PFI comes into force, the FEFC will consider bids for capital projects - around 100 proposals totalling Pounds 300 million. Colleges must show they have looked for private finance before any bid will be granted.

But few expect PFI to help IT needs. Leasing, in which a college hires equipment instead of buying it, is already common. The advantage is that the college can update equipment without committing large sums. But colleges question whether such schemes are more economic than outright purchase.

More advanced schemes have companies taking over the equipment and management of computer services. Phil Hemmings, educational marketing manager for Apple UK and a governor of Halton College, said schemes were successful in areas like local government.

But he warned: “There is a big difference between running a payroll for a council and managing an FE computer department.”

Peter Shuker, principal of Darlington College and chairman of the National Information and Learning Technologies Association, doubts whether PFI will deliver. “It isn’t a realistic alternative to capital allocation for IT. ”