Cash crisis bites deep into staff pay rises
And more than one in 10 colleges said they were too hard up to give staff any sort of increase, according to the survey by lecturers' union NATFHE.
But a third of colleges were waiting for student enrolment figures to become clear before deciding on lecturers' pay.
The union surveyed 127 colleges, about a third of the FE sector.
It found 15 per cent were planning to exceed the recommended 2.5 per cent pay rise negotiated with the Association of Colleges earlier this year. Most offers were below the national rise.
But the survey also shows uncertainty in cash-strapped institutions, struggling to cope with the consequences of a cut in cash for expansion imposed by the last Government in January.
NATFHE negotiating secretary Sue Berryman said: "Some 60 per cent of FE colleges are now in deficit. It's hardly surprising that most of them just can't make further efficiency gains to finance pay settlements.
"Time is running out. Unless money can be found for decent pay awards, colleges will be unable to recruit and retain lecturers of the calibre needed to deliver a high quality education.
"High hopes are being pinned on colleges to widen participation in learning and assist the unemployed back to work. It would be a tragedy if the highly skilled teachers were just not there to fulfil those aspirations."
Education and Employment Secretary David Blunkett is widely expected to announce substantial extra funding for further education next month.
But colleges fear that extra funding will be linked to extra work - providing little succour for lecturers.
Before the General Election, the then Labour education spokesman Bryan Davies, now Lord Davies of Oldham, promised a full-scale review of further education staffing .
Such a review has not materialised, although backbench members of the House of Commons education and employment select committee are considering the whole question of FE funding.
But Lifelong Learning Minister Kim Howells has indicated that a review is still a possibility, when the Government's programme allows.
NATFHE research last year found the pay of FE lecturers had fallen dramatically behind schoolteachers.
Only half of all lecturers earn between #163;20,000 to #163;25,000 compared with 70 per cent of secondary school teachers earning between #163;21,000 and #163;28,000.
Roger Ward, chief executive of the Association of Colleges said the pay situation was a symptom of the general financial crisis in further education.
And he warned extra Government cash for initiatives like Welfare to Work might not mean more money was available for pay rises.
He said: "If the figures are right I'm not surprised at the trend. Everybody knows the state of the finances in the sector is such that there's a funding crisis.
"In the funding crisis the priority of most colleges is to ensure job security and there is no point making pay awards if the result is a large number of redundancies."