Recent indications from the Further Education Funding Council that the mechanism for distributing the Pounds 3 billion of annual funding to 450 English colleges is to be reviewed are particularly welcome among low-funded colleges.

The present system is a source of damaging disunity in the sector, at a time when all colleges should unite in pressing the Government for a fairer allocation to an underfunded sector. There is a deepening concern about the effects of the disparate funding of colleges.

A recent survey of the 135 lowest-funded FE and tertiary colleges revealed that 95 per cent of respondents wished the inequities to be addressed urgently. Less expected was the growing resentment of the competitive advantage of higher-funded institutions.

As one college principal put it: “Colleges operate in a market, and there is nothing more likely to set college against college than a neighbouring college with a high level of FEFC funding using that advantage to engage in unfair competition.”

The predominant underlying sentiment is the relative disadvantage inflicted on the students and staff of low-funded colleges in order to cushion the higher-funded. The much-vaunted stability of funding for better-resourced colleges is at the expense of persisting privation for the low-funded.

Principals understood the need for a transitional period to remove the widely varying funding levels inherited when colleges became independent of local authority control. What was not anticipated, however, was that after more than three years under the new regime the highest-funded college would be receiving a 90 per cent higher FEFC allocation than the lowest-funded. By not bringing about convergence to the extent and with the speed expected the result has been unacceptable pressures on colleges which are already highly cost efficient.

This situation is simply unjust and the disguised subsidy of less cost-effective colleges is an inappropriate and unwise use of scarce public resources. The required solution is equity funding.

Fundamentally, there should be no difference in how much money colleges are allocated, wherever they are, for delivery of a learning programme of a defined number of hours or leading to the same qualification. The current funding disparities are the result of political and social variations prior to incorporation. Such factors have no place in a mechanism designed for the purpose spelled out in the FEFC circular “Funding learning”.

In the Coopers Lybrand 1995 report The Costs of Further Education, it was observed that lower-funded colleges tended to be more actively engaged in controlling costs and were more innovative in their approach to declining revenues. There is no reason why higher-funded colleges could not make the same sorts of changes. Indeed, better-funded colleges should have more options available in facing the challenges. Yet the report acknowledged a lack of pressure on “high cost” colleges to adopt the same efficient strategies.

A defence of the continuing high level of funding for certain colleges has been mounted by Adrian Perry, principal of Lambeth College (Letters, TES, April 5). His case for the current situation draws upon the particular social problems experienced by an inner-city college.

This view is not shared by the principal of Handsworth College, in Birmingham, which has an equally challenging social environment, yet which is funded at around half the Lambeth level. Local circumstances based on social factors are an unsound basis for allocating funding to the core learning process leading to standard qualifications.

If local circumstances, whether of inner cities or rural isolation, are relevant as factors meriting additional funding they should be identified as separate features. A view can then be taken as to the appropriate type and source of finance.The priority should be to establish equitable funding for learning programmes, thus removing this current cause of sector division.

Increasingly further education colleges are being led into funding services to support learners and now subsidise, to a greater or lesser extent, transport, child care and discretionary awards which have hitherto been the responsibility of other providers.

Colleges with preferential levels of funding have the means to take on such non-educational activities with greater equanimity than their lower-funded neighbours. While no one would deny the need for such provision and its importance in enhancing accessibility to learning, it is a further source of irritation to colleges which struggle to stretch their budgets to match the levels of provision offered by their better-off competitors.

Furthermore, the Government is not likely to take seriously the argument that the sector is being progressively underfunded if colleges continue to make good the shortfall in expenditure for such services by other agencies.

Andrew Middleton is the principal of Stamford College, Lincs