Something must be done about it, the Education Secretary told the Learning and Skills Development Agency summer conference.
Sir Andrew Foster, who is carrying out a review of FE colleges, agrees to the point where he would sweep away much of the red tape. He made the point forcefully in an earlier inquiry into bureaucracy.
But, what has happened in between Sir Andrew's two inquiries? Yet another quango - the Quality Improvement Agency for lifelong learning - has been created. So, where are the cuts? Where is the reduction in red tape?
That depends on how all the other quangos respond to the new agenda.
History tells us it is easy for governments to set up agencies. It is far more difficult to control and limit them. They are created piecemeal to deal with particular issues, but then take on a life of their own, identifying and promising to deal with problems no-one previously knew existed.
The QIA has been created partly for this reason. Had the Learning and Skills Council got its act together in 2001, had the Post-16 Standards Unit been seen as a critical friend, and had the need for inspectors also to be advisers been understood, the new agency would have been unnecessary.
But there is a more crucial issue here. The success of the QIA will be the measure of the Government's avowed commitment to pull back from micromanaging the sector.
There was huge support for the agency at the LSDA conference. But arguments for it were too often about redressing deficits. People wanted it to offer advice, to help networking and collaboration, to be a buffer against harsh intervention following judgements by inspectors and the LSC and to counter government failure to trust professionals.
However, the agency has to be much more than this when it opens for business next spring. It must give colleges control over professional judgements and self-improvement. It must demonstrate that government intervention is unnecessary beyond a light touch by the regulators. It must make redundant the role of the Post-16 Standards Unit if not all seven of the big quangos and their armies of consultants currently competing in the quality control and improvement market.
If the cash from costly over-regulation was ploughed back into teaching, it would go a long way to solving the FE funding crisis. Ms Kelly should start by showing trust and move swiftly to dismantle systems that would otherwise make the QIA just another quango.