The future of the smallest further education college in Wales is in doubt following a succession of Government spending squeezes over the past three years.

Coleg Harlech has become a victim of its own success. Nine out of 10 adults passing through its doors move on to university following a one-year diploma, making it the highest-achieving adult education centre in Britain. Its students have had only the most basic schooling. They go to the college for a second chance.

Its achievements were praised in a recent inspectors’ report which described it as a model of education designed to bring out the best in adults.

But, with just 140 residential students and 550 taking diplomas, costs per head are three times higher than the average for the rest of FE in Wales. The average cost per full-time equivalent student at Coleg Harlech is Pounds 8,950 compared with Pounds 2,800 average for other FE colleges in Wales. The difference is larger than that between residential and non-residential colleges in England.

Distance-learning courses, Open University-style, are also seen as the more cost-effective route by hard-nosed accountants and spending policy-makers.

Further efficiency drives are inevitable as the Further Education Funding Council for Wales this week launched a wide-scale review of the way colleges are financed. It is seeking advice on more equitable funding, but its final recommendations are unlikely to boost Harlech’s fortunes significantly.

If anything, the council will conclude that the extreme differences in funding among colleges should be eliminated quickly. Similar pressures are on the FEFC in England where 73 colleges with well below average spending lobbied chief executive Sir William Stubbs last week to act faster to reward efficient colleges.

Coleg Harlech’s Edwardian buildings nestle in the foot of the cliffs beneath the town’s castle. The college was the brainchild of Thomas Jones, deputy secretary to the Cabinet during the General Strike. At odds with the spirit of his age, he preached conciliation and trade union moderation.

It opened in 1927 with six residential students and aimed to take the best of the working class, raise their sights, and send them back to lead their communities.

But modern access courses are now competing with Coleg Harlech and its rural situation makes increasing student numbers difficult. But when the name of the game is efficiency and competition the college is in danger of losing out.

There were cuts of 10 per cent in the budget last year and this. Next year a further 8 per cent will be cut. The college has a budget of Pounds 2 million with slightly more than half being met by the FEFC. The cuts have hit staffing levels and spending on resources such as the library.

Merger with a larger institution is not yet on the college’s agenda, but the FEFC has hinted clearly that this may be the solution.

Professor John Andrews, the funding council’s chief executive, said the cost of provision was high and had to be reduced without putting the future of the college at risk or affecting its high standard of education.

“At the end of the day we have a major problem if costs can’t be brought down.

“We need to deal with disproportionate expenditure and it is difficult to justify funding courses which are significantly above the costs of comparable courses,” he said.

Coleg Harlech warden Joe England said there were obviously problems for the future of the college if the FEFC Wales continues to cut its budget. “They will endanger the college by making unrealistic comparisons,” he said.

The college offers a one-year general studies course for the University of Wales diploma. Traditionally, students need not have any previous qualifications to attend.

The higher costs are increasingly difficult to justify to the FEFC as other colleges in Wales are now offering similar one-year diplomas without the residential costs. But Mr England said none had the proven track record of Coleg Harlech.

“I don’t believe that we have been superseded. While there is severe competition for adult students that didn’t exist when residential colleges were first founded it is still accepted that residential education is a very good means of education,” he said.

Rather than being compared with large FE institutions in Wales it would be more equitable to compare Coleg Harlech with the half dozen similar small residential colleges in England, he said.

The FEFC review of funding FE in Wales includes research and analysis of current spending policies and the study of alternative models. The ways in which different subjects and study methods are paid for will come under the microscope. The ways in which employer-related FE courses are financed will also be analysed, as will the implications of new methods of assessing students.