DAVID Igoe doesn’t wish to appear ungrateful but he just cannot use the pound;93,000 offered by the Government for teacher training at Cadbury Sixth Form College where he is principal.

As usual, with these pots of money from targeted sources, such as the Standards Fund, there is an element of matched funding. His college would have to top it up with around pound;50,000.

“It’s absurd. If I were to spend pound;150,000 on training, I would have no one left in the classroom. It would be more helpful if we could use it with our core funding to improve standards,” he said.

John Harwood, chief executive of the Learning and Skills Council, has some advice which, he stresses, is not meant to be flippant: “Send it back. If colleges are being offered particular funds they do not want, then we will make good use of them.”

This rarely happens, said Mr Igoe. As chairman of the Sixth Form Colleges’ Employers’ Forum, he echoed the views of many principals when he said: “All that happens is that we waste a great deal of time finding creative ways of using it and hoodwinking the powers that be into believing we have spent it on what they expect.”

He has asked the LSC whether he can apply wider criteria to the pound;93,000. This is cash to ensure qualified teacher status. But in sixth-form colleges there are few untrained teachers. “I’ve asked if I can use it for more posts and to improve performance. This is another form of the teaching pay initiative and would help raise teaching standards. The LSC says it will look into it.”

This toing and froing, however, exacerbates the problems of time-wasting and the burdens of bureaucracy. And the long-simmering frustration over the Government’s habit of tying new money up in national initiatives with targets has finally boiled over. After angry reports to its July council meeting, the SFCEF is urgently seeking an audience with Estelle Morris, the Education Secretary.

Sue Whitham, head of the association’s secretariat, said: “We are getting fed up with all the pots and want to know why it cannot go into local funding. The problem is that this is the Treasury-driven something-for-something policy, which is now quite insensitive to local needs.”

Meanwhile, the Association of Colleges is wagging its finger at the Government, saying: “We warned of trouble in our election manifesto.”

Coupled with this is what appears to the AOC to be blatant double standards as the funding gap between colleges and schools with sixth forms grows ever wider. Funding of sixth-forms comes under LSC jurisdiction next April. But it will be a long time before the same spending rules apply to schools and colleges. While schools will enjoy around a 10 per cent increase over two years - thanks to real-terms spending guarantees from ministers - colleges will suffer a 2.5 per cent drop in core income, after inflation, because of the continuing annual “efficiency” savings.

And so, Mrs Whitham said: “There is now a farcical situation where the spending gap between schools and colleges will be greater than ever, despite the promise of a pound;1 billion increase over the next three years.”

The supreme irony in the view of David Gibson, chief executive of the AOC, is that on the day Mr Harwood spelled out the core spending plans showing the real-term cuts for colleges, principals got a letter from Ms Morris pledging a 20 per cent rise in real terms by 2004, while extolling the virtues of the Standards Fund.

Yet again, the spectre of under-achieving colleges and need to improve standards was raised by a minister: “That requires both that we address deficiencies in colleges causing concern, and that we ensure continuous improvement throughout the FE system,” she wrote. “That is why we are investing heavily through the FE Standards Fund and the FE pay initiative, to ensure there are sufficient well-trained, well-led, well-rewarded and well-supported teachers.”

The stress on “well-rewarded” sticks in the craw of employers and unions. With colleges at least 20 per cent adrift from schools on funding levels and, arguably, 30 per cent short on pay, rewards through the FE pay initiative (part of the Teaching Pay Initiative) should have come more quickly.

The indicative TPI allocations for years 2 (pound;100 million) and 3 (pound;135m) have finally gone out. In a press release with the statement, Mr Harwood says that only 33 colleges had returned declarations of intent and he tells them to hurry up. The implication is that colleges have been slow in returning declarations for this year (pound;65m).

It follows the complaint from adult skills and lifelong learning minister John Healey that colleges had been dragging their feet in implementing TPI.

College registrars and finance directors are outraged by both suggestions. Julian Gravatt, director of finance at the City Lit in London, said: “Colleges have had about 14 weeks to work on TPI. In that time, it has been necessary to work out a complicated pay scheme in line with the 100-page guidance from the Department for Education and Skills and the AOC.

“They have had to ensure that managers think the pay scheme works, consult on it with the lecturers’ union NATFHE, and ensure that it is not out of line with local colleges.

“The scheme has had to go through governors, which (in line with government-recommended good practice) involves a sub-committee and a full governing body.

“The assumption between Healey and Harwood’s complaint is that all the above can be fixed in an instant. If the DFES and LSC want faster decisions, they’ll have to strip away the complicated processes that were required of colleges to ensure that principals did not make bad, fast decisions without consultation,” he said.

And, as a study by John Brennan, AOC development director, shows, the Standards Fund is just one of at least 73 “funding streams” colleges are expected to tap into - each with its own time-consuming and often conflicting bureaucratic demands and auditing requirements.

The need to bring more cash into the core funding, for colleges to control within the remit of their local LSC, was paramount, said Mr Gibson. “Colleges are held accountable very publicly. How can you criticise them if they cannot prioritise the areas of greatest need?” Colleges should have the same freedom granted to universities and their vice-chancellors, he said. “Each area is historically different, each clientele is different. Local people know best how to hit the targets.”

The Standards Fund is growing five-fold, from pound;35m in 1999 to pound;170m in 2003. But with it, there are growing tensions between the LSC and DFES. Local LSC executive directors at this month’s LSC council meeting urged the DFES to “get off our backs”.

There is currently a government review and evaluation of the Standards Fund. “But it won’t come soon enough,” said one LSC executive director. “The Government can’t create a body like ours and still expect to keep a tight grip on the purse strings.”

Mr Harwood has sought an audience with the AOC and SFCEF to find a solution to the funding disparities. And in last week’s FE Focus, he expressed his desire to see greater flexibility, with the wider post-16 sector being given a freer hand over the criteria and spending of centralised pots such as the Standards Fund.