The annual fees survey by the National Institute of Adult Continuing Education found average fees on subsidised courses fell to an average of Pounds 1. 04 per hour in colleges and 97p for local authority-run classes.
Last year average fees were running at Pounds 1.05 in LEAs and Pounds 1.13 per hour in colleges. Non-subsidised course fees rose slightly - by 3 per cent in colleges and 2.3 per cent in LEAs - but by no more than the rate of inflation. Average fees for the unemployed and elderly students are also down.
NIACE officials expressed delight at the falls. The figures did not show widespread cuts in the number of courses available, they insisted. Sue Cara, NIACE associate director, said competition between colleges explained part of the price fall.
But she said subsidies on so-called Schedule Two courses - those listed as eligible for public subsidy from FE funding chiefs under the 1992 Further and Higher Education Act - drove down prices on courses run without support from the Further Education Funding Council.
She said: "There's a kind of FEFC effect. You can't attract students to a non-vocational conversational French class, for example, if a subsidised GCSE course is half the price.
"The problem is many people returning to college for the first time have to pay higher fees for basic courses than people who are more advanced."
She said some centres had found courses were not viable because they could not attract students if they charged the high fee levels needed to keep programmes running.
She said: "It's good news for learners, but it's not good news for providers who are under huge financial pressure. In some ways it looks as though it can't be bad news for learners, but if some providers go out of action there will be fewer courses. Falling fees are wonderful so long as the infrastructure is there to run the courses."