Roger Ward, chief executive of the CEF, said: "We agreed pay increases of up to 2.4 per cent. Colleges who cannot find it are allowed under the settlement to pay nothing if they want to."
A survey by the largest lecturers' union, NATFHE, which refused to sign up to the national deal, suggests that 70 colleges will pay nothing. Sue Berryman, negotiating secretary for FE, said: "Our members are very fed up, seeing school teachers get a 3.5 per cent rise at the beginning of the year."
Many heads told The TES they will stick to between the 1 and 2 per cent they said was their maximum when they responded to a CEF survey in advance of negotiations. Colleges in the North are among those facing a tough show-down with NATFHE.
Principals were outspoken in expressing their regret at the move. Justin Togher, principal of City of Bath College where the increase is 2.1 per cent, said: "I want high pay, high productivity, high calibre staff.
"But that is impossible given the financial situation the funding council and Government have pushed us into."
The smaller Association of Teachers and Lecturers, with 5,000 members in FE, accepted the deal and says it will push for the maximum to be paid in all colleges.
Gerald Imison, assistant secretary for further education, said: "We reluctantly agreed at our executive meeting to accept the 2.4 per cent for people who are on new contracts.
"We need to be in the position to do deals. For far too long, Roger Ward has pushed things through regardless."
The ATL is reckoning on a decent deal on new pay and conditions through the conciliation service ACAS next April. Two years ago, the union and CEF brokered a deal on new contracts through ACAS, which NATFHE refused to sanction since it included the phasing out of any reference to a ceiling on working hours.
That contract is up for review next year. The employers will be looking for a fully flexible contract - possibly based on lecturers' workloads rather than hours. The ATL will want arbitration service support for significant productivity awards.
The union is understood to be seeking a preliminary meeting with ACAS officers for their likely views on the prospects of significant pay increases to be attached to further productivity deals.
One CEF source said: "The ACAS review is a potential minefield.
"It is an issue that the new merged board (of the CEF and Association for Colleges) must turn its attentions to with some urgency."