Colleges and universities remain deeply wary of cross-sector merger following signs of serious troubles with two proposed unions.

Despite predictions of a wave of mergers once colleges left the relative financial security of local authority control, both further and higher education institutions are resisting formal links.

The prospect of a host of new “comprehensive” post-16 institutions looked further away than ever at a conference on HE-FE merger at the University of Central Lancashire.

Colleges and universities represented agreed that though HE-FE partnerships were welcome and here to stay, the case for full mergers remained “unproven”. They raised strong concerns over the implications of the step, particularly for FE partners.

They were unconvinced by the arguments of Derby University and its five partner FE colleges which are considering proposals for a regional university network. The scheme is the first merging a higher education institution with general FE colleges.

The Derby initiative has not impressed the Further Education Funding Council, which must give approval before the bid can be referred to Education and Employment Secretary Gillian Shephard.

FEFC chief executive Sir William Stubbs warned that much work is still needed to make it a concrete proposal.

The FEFC is widely believed to be sceptical of FE-HE mergers, and is understood to question the Derby scheme, which it fears could limit student choice.

Colleges and universities at the University of Central Lancashire conference said the scheme might be appropriate locally but could not be applied through the UK. Some suggested the proposal was motivated by cash concerns on the part of some of the partners.

Many believed the possibility of a full six-institution merger, provisionally scheduled for September 1997, was highly unlikely. The project has been set back after governors at the five colleges ruled out recommending moving immediately towards a single legal entity.

Derby vice-chancellor Roger Waterhouse admits all five colleges will not come on board at once, and says legal union is still only one option. The partners might create a company to provide central services, or the colleges could contract with the university to provide such services.

Suggestions that the radical Derby scheme is foundering follow troubles with another proposed FE-HE merger. A bid for union between the University of Central England and East Birmingham College reached the formal proposal stage, but fell apart when the FEFC called it more of a mission statement than a detailed application.

A third scheme for a merger between the University of Staffordshire and Newcastle-under-Lyme College is still being developed. It may be more likely to find FEFC favour than the Derby bid, but would have to convince the council that students at neighbouring colleges will not lose out when applying to the partner university.

The debate on cross-sector merger is coming to a head now because previous links have involved only specialist nursing, art or agriculture colleges.

Advocates of the Derby network claim the structure would benefit students by offering a credit-based system allowing local progression from FE to HE. Merger would improve access to HE for students in the county’s rural west, say the partners, while colleges would benefit from shared investment in the curriculum and central services.

Professor Waterhouse admits universities, including his own, will be reluctant to invest in partnerships with colleges without legal ties and exclusive deals.

For Alan Harrison, principal of Mackworth College, one of the partners, the network would re-establish the “overall strategic thinking” for the region’s post-16 provision removed at incorporation. The spectre of academic drift - the loss of a sense of mission many predict could haunt FE if mergers multiply - is already being raised thanks to under funding in the sector, he argues.

However, Sir William Stubbs has warned the partners that “more does not mean safer”. He is known to be suspicious of colleges apparently rejecting the independence bestowed on them at incorporation. Derby College, Wilmorton, asked to join the network scheme, has declined in favour of maintaining independence.

Stephen Ward, co-ordinator of FE-liaison at Bath College of HE, said: “The move towards a monolithic institution seems out of step with the tendency we see now towards scaling down.”

Many shared the concerns of Richard Evans, principal of Stockport College of FHE and a critic of full merger. Dr Evans called for a long period of analysis of the relationship between FE and HE, warning: “The urge to merge is dangerous. It is a minefield. Like so many urges in life, it is based on imagined, short-term gain.”

Current, looser collaborations between the sectors were working well, he said, and should change only through “a very gentle, incremental development”.

Full mergers on the scale of the Derby scheme could diminish choice for learners, he argued.

Stockport College, whose one-third HE provision is predominantly part-time and geared towards local employers, is unusually extensive but typical of the sector in being complementary to universities.

Sir Ron Dearing’s latest inquiry, examining the funding, size and structure of HE, is expected to clarify whether such a model will endure.