Failure to include a foundation-level award in the diploma is a fatal flaw in an otherwise excellent package, argued college managers and headteachers, following the launch of the 14 to 19 Green Paper this week.

The diploma is an overarching award for academic and vocational studies, extra-curricular activities and voluntary work. Ministers propose that it is pitched at three levels: intermediate (five GCSEs A*-C or equivalent); advanced (A and AS-level); and higher (NVQ level 4).

When Estelle Morris, the Education Secretary, launched the plans, she said:

“The diploma is not prizes for everyone.” While she meant that it would be rigorous at all levels, the comment has also been interpreted as being “exclusive” of slower learners.

The Association of Colleges, Secondary Heads Association and Association for College Management warned that Ms Morris’s belief that the diploma “would give an incentive to stay on to 19” was ill-founded without a reward for lower achievers.

The diploma would not be presented until the learner reached 19, and ministers expect the overwhelming majority to reach at least intermediate level by then.

Nadine Cartner, education officer for the ACM, said that while much of the Green Paper was welcome, it betrayed a deep misunderstanding among ministers.

“Estelle Morris imagines that if we could just offer the right curriculum, with vocational opportunities from the age of 14, all learners will be able to achieve a level 2 at around 16 or not long after.”

But John Dunford, general secretary of the SHA, said: “About 50 per cent do not make it by 16, and 20 per cent don’t by 18. Special schools and colleges would welcome a foundation level as a way of motivating pupils.”

College leaders and private training providers agreed. Colleges with high numbers of disaffected and impoverished students said around 47 per cent could “fail” under the Government’s plans.

Judith Norrington, curriculum director at the AOC, said: “We have argued throughout for an award at each level. You need proper stopping points as well as proper progression points.”

Schools minister Stephen Timms said: “At foundation level, we are proposing a certificate for those who do not achieve the intermediate level.”

But Mr Dunford said: “This is as good as telling them, ‘You have failed’. These are people whose self-esteem is often low and we have to attach status to their aims.”

What the diploma included at 19 was not the only issue, he said. Equally important were the signals they received along the way. “We want to get away from age-related qualifications. Let us recognise achievement when they get it.”

Ms Norrington and Mr Dunford’s arguments were reinforced by Ken Spours, senior researcher at the London University Institute of Education, who has done much of the work on assessment reform for the professional associations and unions.

“If we are going to have goals for all levels we should have a proper ladder - and the foundation level must be the first rung. What the Government is giving us is two separate ladders.”

For the colleges, any long-term drive to improve work with schools, as outlined in the Green Paper 14-19: Extending Opportunities; Raising Standards, will need more resources and equal pay for school teachers and college lecturers, the college lecturers’ union NATFHE, the ACM and the AOC warned.

An indication of costs is revealed in a scheme based at Sheffield College (see Green Paper analysis pages 7-9) which is seen by ministers as a model 14 to 19 development. Collaboration depended on an extra pound;500,000 last year from the ESF and Excellence Challenge.

The AOC says 150 colleges work with schools on Green Paper-style links. The Government wants one in five 14 to 16-year-old pupils part-time in college. For this, the AOC estimates pound;123 million extra would be needed next year, rising to pound;372m in 2005.