Similarly, the council will impose measures "to make every penny count", spending more on learndirect students and less on University for Industry bureaucracy. But, as we report on page 1, hundreds of thousands of pounds are squandered by failing hubs, with the LSC powerless to intervene.
And, while colleges need more desperately than ever to market themselves to parents and employers (page 6), what little they do spend could be cut through LSC austerity measures.
The LSC response to Education Secretary Charles Clarke's letter on its grant for the next three years (page 1) is a remarkable construction, aimed at minimising damage from what - as we were warned - amounts to a series of cuts. Growth in cash falls well short of the expected rise in student numbers.
There are echoes of the 1990s under the Tories in the response, with terms like "efficiency" savings creeping back. The LSC's jargon merchants have even invented a new euphemism for cuts in the phrase "re-basing college allocations".
But the most telling phrase in the six-page document is almost thrown away at the end: "Local LSCs will need to work closely with local LEAs, providers and partners to support the priority actions needed to address weakness and improve performance in local areas."
Indeed, at a gathering of LEA chiefs last week Mr Clarke lamented that he had not given them more say on the LSC. But such failures run far deeper than the role of local authorities.
Few of the multifarious overlapping agencies created under Labour show any real signs of the promised joined-up government. The LSC is one of the first quangos to make a serious stab at it. Shame it is in a climate of budget reductions.
The LSC response to the grant letter will upset almost everyone, since all -except sacrosanct sixth forms - must share the costs. The pity is that too many easy targets have been selected.
For example, are the current inspection measures really sufficient to identify under-performance? If not, cuts will do more harm than good.
Until the Government knuckles down to creating a truly joined-up post-16 sector then measures to balance budgets will always apear to be piecemeal.