Colleges were promised new financial freedoms and an end to Ofsted inspections this week in what the Government said was the first stage of a new strategy for skills.
John Hayes, the skills minister, set out a range of measures designed to give colleges and training providers greater flexibility in delivering the education and skills demanded by learners and employers.
The measures include the freedom for colleges - apart from poor performers - to switch money between budgets, a move designed to help them respond quickly to changes in local demand, and an end to Ofsted inspections for "outstanding" colleges, as long as their performance is maintained.
Mr Hayes also promised the removal of the requirement for all providers to complete summary statements of activity and for principals to complete the Principals' Qualifying Programme.
Speaking at City and Islington College yesterday, Mr Hayes said: "This announcement sends a signal on how we are changing the relationship between Government and further education.
"Responsiveness is crucial if we are to provide the skills that employers need and students want. Removing unnecessary burdens and freeing colleges to react to local demand will help achieve just that.
"I want to unlock the energies and talents of all teachers and learners in colleges across the country."
Mr Hayes indicated that the announcement was the beginning rather than the end of a process of reform for education and skills.
"We are opening what I hope will be an enduring dialogue between government and colleges on how we respond to new challenges and take up new opportunities, because I am determined to give everyone the chance to get on in life through new skills and qualifications. I know just how important further education colleges are in delivering the Government's ambitions."
Frank McLoughlin, principal at City amp; Islington College, said: "Outstanding colleges generate excellence, student success and staff engagement not through top down edicts but through trust and autonomy. The new freedoms announced in my college today are good news. They give a clear indication of a refreshing relationship with the new ministerial team."
Lynne Sedgmore, executive director of the 157 Group of leading colleges, said: "The new freedoms for colleges are strongly welcomed by the 157 Group. They illustrate a clear trust and respect for high performing colleges and college leaders."
Business secretary Vince Cable and Mr Hayes also wrote to Geoff Russell, chief executive of the Skills Funding Agency, this week, setting out the spending plans for 201011.
There is 3.5 billion to support training places and a further 1 billion to fund other areas of FE spending, they said. This includes 550 million for apprenticeships and another 757 million for other forms of work-based learning.
Priorities for spending include developing lifelong learning accounts and reducing the numbers of young people not in employment, education or training.