“COLLEGES hope that, with the health service favourites already promoted and out of the competition, and transport derailed, they will be a winner in this year’s spending review sweepstake”.

How many similar headlines have we seen in recent weeks? How many more readers have dreamt them? But does further education deserve to have its dreams fulfilled?

It is instructive to look back. The newly independent sector in 1993 promised well. Between then and 1996-97 student numbers grew by 287,000 or 17 per cent; numbers on vocational courses burgeoned; and access was widened, with increasing proportions of women (up to nearly 60 per cent), ethnic- minority and basic-skills students.

And then? Between November 1997 and November 2001, numbers increased by just 0.5 per cent or 10,000 students. They have still not regained their 1996-97 peak. There has been a significant reduction in national vocational qualification level 3 courses and equivalent, offset by increases in entry (especially basic skills) on to level 1 and level 2 courses. IT apart, the numbers on vocational courses have increased little.

So what has gone wrong? Clearly, there must have been a major squeeze on expenditure since 1996-97. Wrong: between 1993-94, when the FE sector was established, and 1996-97, government funding did increase - by 17 per cent in cash terms - but that entailed a squeeze of 12 per cent on the amount of funding per student. Since 1997-98, the Government, with an unprecedented commitment to FE, has increased funding by nearly 20 per cent in real terms.

So, the economic climate must have deteriorated so that employers no longer trained? Wrong: on the contrary, business expenditure on training has never been higher.

So what has gone wrong?

First, the abolition of the Demand Led Element (DLE) of funding in early 1997 disrupted planning and funding: collaborative or franchised provision had grown from 5 per cent of FE colleges’ provision in 1994-95 to more than 20 per cent. It had accounted for a good part of the total growth of the sector. It had been funded almost entirely at marginal cost by DLE. Since then, colleges have felt unable to plan for growth with the same confidence.

Second, the Government’s justified focus on quality contributed to a sense that this was more important than growth. And with a tougher regime of performance indicators and inspection, colleges have felt it was better to stick to their knitting and get good inspection grades than take a risk on a new initiative with a dodgy partner.

Third, the sector did seem to lose its way. The Kennedy report, Learning Works, rightly emphasised widening participation in FE. But despite the strong business representation on their governing bodies, colleges lost their equally important focus on economics. They failed to develop courses for the new, more discriminating business client. Nearly 10 years after independence, colleges’ reliance on state funding is as high as it ever was.

Fourth, the sector is tired. The real impact of the global economy is to remove the need for economy on communication: “any time, any place” means you have no time and no space to yourself any more. And looking over one’s shoulder at neighbours who seem marginally better rewarded, does not help.

So, what is needed? What are the lessons of the past 10 years?

First, it is clear that money talks: the rewards for growth built into the original FEFC funding regime did secure genuine growth, as well as the abuses of unit farming and phoney students that caught the headlines. The restoration from 2002-03 of DLE (still a rose, by any other name) should help.

Second, the quality agenda is not going to go away. Colleges have to improve their focus on retention and achievement, and own the quality agenda themselves.

Third, the sector must stop looking over its shoulder and have confidence in itself as a key driver of the economy: it must earn much more of its income from the employers whose task it is to serve.

And finally, while more money will always be welcome, colleges should stop waiting for Godot.

David Forrester was director for Further Education and Youth Training in the then Department for Education and Employment from 1995-2001. He is now an independent consultant and college governor. He writes in a personal capacity. davidforrester@btinternet.com