Fairer grants still come at a price
But the Scottish Further Education Funding Council believes its college-by-college decisions, for which it had responsibility for the first time, are more transparent and predictable than previously. Colleges have not only been given information on how their own funding has been arrived at but are now able to access calculations for other colleges on the funding council's website.
Colleges will receive a net increase of 8.3 per cent, bringing their recurrent grant to pound;284 million, which for the first time covers the 2000-01 academic year rather than the financial year - giving three months to plan ahead compared with one month in the past. Another pound;41 million goes towards student bursaries, an increase of 12 per cent.
Robert Beattie, the funding council's chairman, commented: "This funding provides for stability and flexibility in the sector and gives colleges incentives to attract more students who can benefit from further education, particularly those from low participation areas."
The council is anxious to make clear that its settlement represents a fresh start, intended to allow colleges to plan ahead and move away from retrospective funding based on student numbers from previous years.
"There has been blind competition in the past," David Wann, its deputy chief executive, said. "We believe placing conditions on what is to be delivered is the way forward rather than reacting to what has happened in previous years. We are saying to colleges, 'if you act like this in future, you can expect this level of money'."
This means colleges will increasingly be funded to deliver Government policies on widening access, recruiting students from disadvantaged backgrounds and promoting social inclusion in general. But Mr Wann said the council recognised a "perfect fit" between aspirations and funding would not always be possible.
Colleges would therefore be allowed up to a 2 per cent under-enrolment without any effect on their grant "in recognition of the fact that there is volatility and the need for flexibility."
The council has also acknowledged that 14 colleges will still require what used to be called a safety net. This has now been rechristened "transitional support" to emphasise its temporary nature. It accounts for pound;7 million, of which pound;3 million comes from a "marginal tax" on the most advantaged colleges and the reminder from funding council coffers. This is to ensure that no college receives less than a 2 per cent increase in cash terms compared with its existing grant.
The Association of Scottish Colleges will be anxious to pore over the small print to ensure the move from one funding system does not perpetuate what it believes has been the "aggressive" nature of the way the old formula redistributed funding among the colleges.
The main beneficiaries of these special arrangements are Stevenson College in Edinburgh, which is to receive additional help of pound;2.2 million, and Langside in Glasgow, which gets pound;1.4 million. But both have been put on notice that they will have to produce recovery plans to reduce their dependency on relief measures.
The 14 colleges receiving the minimum 2 per cent rise compare with James Watt in Greenock, which receives the largest increase of 29 per cent, followed by the Barony College with 25 per cent and Angus and Aberdeen with 16 per cent each.
There are individual explanations for each of these decisions. James Watt, for example, has been funded for its Kilwinning outpost as has Falkirk to support its Stirling centre. Barony, an agricultural college, benefits from special measures for rural, remote and island colleges worth pound;3.5 million spread across 14 colleges.
The council is also providing incentives for colleges to meet Government targets on attracting 40,000 FE students within three years, particularly those from disadvantaged areas. An "entry cost" element of pound;8.3 million is included in the total to meet pre-course costs of recruitment and initial guidance, equivalent to pound;22.50 per student.
In addition, the funding council has established a pound;4.3 million "social inclusion" premium for colleges serving areas with 20 per cent of the most deprived postcode addresses, which is set at pound;45 per student on top of the entry cost allowance. These measures make John Wheatley College in Glasgow's east end a major gainer with a 15 per cent increase.
Although the overall settlement is worth an extra 8.3 per cent on average, the picture is more complex than that. The actual growth built in for college activity is only 5.2 per cent, there is 2.5 per cent for inflation and the pound;4 million contribution to helping out the hardest pressed colleges represents another 1.6 per cent - a total of 9.3 per cent. The need for colleges to control their spending so as to show a 1 per cent "efficiency gain" provides the final figure of 8.3 per cent.
Next week: how the colleges see it.