It rejected claims that the new funding system - being piloted from this autumn - would rob sixth-forms of cash which would instead be ploughed into further education colleges.

But, during a presentation to the Welsh Assembly’s education committee, it offered two options for mitigating the impact of the changes on the most badly affected schools.

The first would be for budgets to rise by inflation each year, which would mainly benefit school sixth-forms as the highest-funded providers at present. The second option would be to offer a three-year fixed-funding guarantee, so providers would know how much to expect in budgets.

Anna Brychan, director of the National Association of Head Teachers Cymru, said it would be looking at the proposals carefully. But she was concerned that funding guarantees, if only based on current “cash” figures and not allowing for inflation, would fail to take account of spending increases arising from, for example, teachers’ annual pay review.

“We need a great deal more detail on this. People are still worried about what this will mean in the long term, and how it will work in more rural areas,” she said.

Conservative Assembly member David Davies asked ELWa to be “open” about its ideas for post-16 education in Wales, and how funds would be shared out.

He said: “Both funding options will lead to a reduction in funding for sixth-forms. Over the next four to five years there will be a reduction in the amount of money going into sixth-forms to fund FE colleges. We want a bit of openness.”

But Mike Hopkins, ELWa’s director of learning, said money would be divided between schools and colleges to give the best choice for learners.

He said: “Maintaining the current system is not viable. We must have equality of funding across the sector.

“We want to provide a level playing field for learners, whether at school, college or with a private learning provider.

“At the end of July, ELWa will publish funding allocations and we hope to finalise a funding model for implementation next year.”

ELWa chair, Sheila Drury, added: “There isn’t one clear figure for funding across Wales. There is already an enormous diversity of funding.

“We have gone out and talked to headteachers and they said that when costing budgets, around 80-85 per cent goes on staff costs.

“We cannot gallop towards our new finding system - we have to have periods for review and progress.”

But Labour Assembly member Jeff Cuthbert told the committee that school sixth-forms would suffer under ELWa’s funding proposals.

He said: “I wouldn’t want to see sixth-forms closed. I am concerned across the board for those who live in deprived areas.

“There needs to be a good balance between vocational and academic subjects.

But everything you have said suggests it is school sixth-forms that are going to get a hammering.”

However, Mrs Drury said: “We are listening to observations from headteachers and stakeholders. Collaboration is fundamental.”

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