Chris Hughes, chief executive of the Further Education Development Agency, compared the situation between England and Wales.
"In England we have a pound;115 million Standards Fund that is being spent on improving colleges over the next two years. The fund is helping to improve teaching in colleges in England.
"It is helping to turn round weak colleges, helping moderate ones to improve and good ones grow stronger. And the initiative is making it possible for weak colleges to learn from strong ones."
But he told the Association of College Managers, at their conference in Newport, South Wales, that there was a lack of investment in Wales to raise standards and to prevent people leaving courses early.
"Compared to England, Wales has too few initiatives to improve standards. The investment in England means that teaching is improving, but the same help is being denied to the Welsh.
"I urge the Assembly for Wales to close the growing gap between investment in the two countries and ensure that Welsh students do not lose out."
The Association of College Managers represents managers at all levels in post-compulsory education and training.