At a time when the Department for Education and Skills is putting FE under a microscope region by region, I can understand your unease. The strategic area reviews make sense, although there have been concerns about inconsistency which may be unfair on some providers.
Improved relations between providers are good news and in many cases seem to have pre-empted the rationale behind the present survey. I would agree that the next logical step might be a new type of university with campuses, formerly colleges, under one umbrella. This does not necessarily mean jobs will be lost. A few noses will be put out of shape, but that's been the way since 1993. It all sounds positive to me. But in my experience, FE lecturers don't like change. Time to grow with the flow!