The Government will have to cut higher education to divide cash fairly between colleges, universities and schools, a leading prinicipal has warned.
Colin Flint, principal of Solihull College, said: "Higher education has too large a share of the education budget. We cannot go on trying to take what was designed as an litist education system and try to meet the needs of a mass education system through the same methodology.
"We have a real problem with the funding of education; in comparison with junior, secondary and further education, HE gets too big a share."
His views came as colleges absorbed the implications of the Government's decision to fund expansion for this academic year, but halt so-called demand-led cash from September.
He was speaking at a conference on the higher and further education divide, organised by the National Institue for Adult Continuing Education.
Mr Flint, who is also on the board of the Further Education Development Agency and the executive of NIACE, called for wholesale reform of post-compulsory education, including a national regulatory body, a single inspection and quality regime for general education, a single funding formula and single syllabuses for each vocational area.
Delegates heard moves were afoot to link many aspects of further and higher education. But the meeting of about 100 leading figures in the college and university worlds heard there were still fears about a drift towards an lite academic system, spearheaded by the old universities.
Professor Christine King, vice-chancellor of Stafford University, which is heavily involved with partnerships with FE colleges, insisted that growing links between FE colleges and the HE sector would continue regardless of national policy.
But she warned that lite universities could become increasingly isolated from integration, to the detriment of students.
"There's a very clear divide; it's not a strategy for the older universities because they do not believe they are in the same league," she said.
Sue Dutton, Association of Colleges deputy chief executive, argued for all sub-degree work to be concentrated in FE colleges, a move which former Further Education Funding Council chief executive Sir William Stubbs said had effectively already occurred in Scotland.
He argued that Scottish universities had drawn away from Higher National Certificates and Diplomas, leaving the work to the FE sector, but ensuring that those qualifications allowed easy access to HE.
But Professor John Andrews, chief executive of the Welsh further and higher education funding councils, warned: "There's a very real risk of affecting the mission of FE colleges and them being caught up in this drift. There's a danger that we could do considerable damage to the FE sector and the HE sector if we don't get the balance right."
He added Wales could have a fully unified funding council within the next few years. He said the Welsh funding councils had been able to unify many aspects of their operation to suit the small number of institutions in the principality, but had drawn back from a single council for both sectors in Wales.
He said: "It would require legislation, but my own impression is we could go forward with one council, but I still feel not now. There is a lot to be done to get both FE and HE houses in order. I feel now definitely by or just behind the millennium we could be funding the entire sector from one council in Wales."