Colleges will be freed from some of the current cash constraints under the Further Education Funding Council. They are also expected to receive a far greater share of the Pounds 3-5 billion windfall tax on public utilities than suggested in the past three weeks.

A new Labour government would also be expected to announce a special pot of windfall cash for colleges which provide innovative courses. Labour education and training sources said they could not “wave a magic wand” on May 2. But a rethink has clearly resulted in colleges being given a higher priority on cash.

David Blunkett, shadow education spokesman, told The TES this week: “Further education has proved that it is well-equipped to expand quickly and we will be kick-starting a new deal.” His pledge was made while unveiling the wider education proposals.

Bryan Davies, his deputy, also promised a loosening of the tight reins on funding. Spending constraints imposed by the Tories had to be relaxed for the sake of much-needed expansion of adult education in the broadest sense, he said.

“The drive downwards to an average level of funding has choked off experimental education which has benefited a wider range of participants and which the FE colleges have proved to be good at.”

And in a further bid to bring the colleges centre stage in Labour’s post-school strategy, its training spokesman, Stephen Byers, said he expected colleges to play a leading role in providing courses for the University for Industry.

Further details of how the UFI would work and fit in with new government policy were outlined to The TES this week (see page 27). It will be a body which commissions schemes to encourage retraining in industry. It will not itself design and provide courses.

“This will mean new money for colleges but they will have to provide exciting courses for use in the workplace,” he said. His comments coupled with Mr Blunkett’s promises mean colleges willing to get involved in franchises and partnerships stand to shift their balance on income further from dependency on the FEFC. But new quality controls are expected to give more rigorous checks on standards from day one of any contract.

Other parties have dismissed the proposals as a vote-getter which would fail or, worse still, be ignored once Labour was in office.

James Paice poured scorn on Labour’s plans during an interview this week (page 26). He promised growth in adult education - if the Tories came to power - to equal the massive expansion of FE over the last four years.

But, he insisted, it was unrealistic to expect this to be at the continued expense to tax-payers - whether through the windfall tax or raised income taxes. But it would be fuelled by investment by employers and individuals. He dismissed Labour’s Welfare to Work proposals - another potential source of FE expansion - as “a complete con trick on young people”.

Liberal Democrat policies are closer to Labour’s as they include proposals for individual learning accounts in which the state, as well as the individual and employer, would invest for training.

But Don Foster, their education spokesman, said Labour’s plans still lacked the essential ingredient of new cash, which the Lib Dems would raise through a penny in the pound on tax. He stressed the need to “rein in” colleges within new regional structures.