Harvey McGavin and Steve Hook report from the conference of the Association of Colleges in Harrogate.
HALF of the colleges in England and Wales are to be turned into specialist centres of excellence under plans unveiled by David Blunkett.
The plan involves investing pound;100 million over the next three years in setting up national and regional centres of excellence, as well as a "pay and morale" boost for lecturers and more money to tackle under-performance identified by inspectors.
Mr Blunkett says the measures would "achieve a radical transformation in colleges' capacity to provide the skills we need to prosper in the new economy.
Together they take additional spending to pound;759m over the next two years - a real-terms increase of more than 15 per cent by 2002-03".
He was speaking at the Association of Colleges' last conference before the abolition of the Further Education Funding Council next April. Its role, along with the training functions of the training and enterprise councils, will be taken over by the Learning Skills Council and its 47 branches in England.
The centres of excellence are expected to be operating in all of the selected colleges by 2004-05, he told the conference.
"Just as specialisms have driven up standards in schools, so in further education, specialisation will sharpen the colleges' focus on meeting the skills needs of business.
"We are already taking action to modernise technical and vocational education.
Now we must create the specialist technical excellence in colleges to meet the important need for new skills.
"Colleges need to win the confidence of employers by being committed, innovative and having a reputation for excellence," he told the conference in Harrogate.
"We will be working with the LSC to identify the colleges where learning, in particular vocational areas, should be developed or expanded.
"At the same time we will expect colleges to tell us how they plan to transform into specialist centres."
The AOC said it will be difficult to predict which subjects are likely to be chosen by colleges applying for specialist status, bt David Gibson, chief executive, said: "Obviously we are going to need to recognise that people are mobile and take that into account, along with the needs identified by businesses at the local level through the LSCs."
On pay, the Secretary of State said money will be made available to ensure that good teachers will be rewarded with improved pay.
"Subject to our being satisfied that proposals put forward satisfy our agenda, the Government will make pound;50m available next year for pay, with pound;100m to follow in 2002-03 and further increases in the future."
College principals reacted warmly to the announcements of increased funding but said there were still issues where they would like to see the Government take action.
Jonathan Godfrey, principal of Hereford sixth-form college, said: "I'm very pleased about the injection of cash into the sector.
"I hope he responds to the comments that were made about funding pay rises for FE teachers, which colleges have had to provide by making efficiency gains for the past nine years."
Keith Bate, principal of Halesowen College, said tertiary colleges like his could be the ideal model for delivering the proposed mixture of A-levels and vocational specialisms.
"Mr Blunkett stressed the importance of links with schools and that should create a vocational route from 14 right through to the world of work."
Tim Capron, principal of Northumberland College, commented: "I welcome the continued push for collaboration but I was disappointed there wasn't a bit more about student support. In a rural area like ours we have students who must travel 40 or 50 miles to come to college, and transport is a huge issue."
Dr Roger Bennett, principal of Askham Bryan College, York, said: "It was positive and encouraging that the extra money should re-motivate senior managers but we could still do with more money for teachers.
"On specialist colleges we have got to take the balanced view. Conceptually it's probably a good idea but how it's implemented is key. It could disenfranchise some colleges and play up some others. We don't want it to be divisive."