College principals have reacted with disbelief to recent pronouncements from vice chancellors concerning degree and sub degree provision in the further education sector.

Commenting on the Higher Education Funding Council's consultation document on the subject last month, vice chancellors argued that further freestanding development of higher education in the college sector would have few advantages and numerous dangers.

Many colleges see degree and sub degree level courses as vital to their own financial health and as the key to successful access programmes.

Not only have vice chancellors signalled their disapproval of any acceleration of such provision in colleges but the funding of the arrangements is far from certain. So what does the future hold for the growing number of colleges which have invested heavily in higher education?

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Such courses offer mandatory student grants and colleges are unlikely to give them up in a hurry, particularly when the demand is so strong.

At City College Manchester principal David Gibson believes that more students now want to study close to home. But he is at a loss to understand why the funding system pays him significantly less than his neighbouring universities to offer a degree-level course. "The current debate on funding of higher education is critical and the uncertainty surrounding the role of FE reflects a lack of vision and is putting all our courses in jeopardy," he said.

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City College now relies on the Further Education Funding Council for just 55 per cent of its income, significantly below the national average, and an important part of the college's diversification strategy involves bidding for funds from the HEFCE. Currently the council is consulting on whether this arrangement is satisfactory given the squeeze on resources.

Vice chancellors have told HEFCE that colleges should concentrate on complementing higher education provision rather than developing their own courses. Otherwise, they argue, any real increase in HEFCE funding in the college sector can only be paid for by a further acceleration in the decline in the unit of resource.

City College Manchester offers degree courses in acting studies and technical theatre arts plus several BTEC higher level courses. Since the programmes began three years ago growth has been exponential, according to staff who perceive enormous benefits from their links with Manchester's two universities. Some students can progress on to degree programmes at the universities, according to their performance in college, and it is hoped such agreements can be extended.

"We may not have the resources of the universities but we more than make up for it with our student counselling and support," said Gerri Moriarti, head of drama who stressed the importance of small groups and one-to-one staff student contact in a college setting.

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This perhaps unique feature of college life is warmly appreciated by higher education students at City College Manchester who acknowledge that they have to overcome the snobbery of the outside world which tends to assume that degrees are studied in universities rather than colleges.

Students were satisfied that the teaching quality at the college matched anything on offer at university but more importantly they appreciated the personal touch. "The staff here respect us and if we have problems they don't need to look up who we are. This is a small friendly place but it is not easy!" said one student.

In fact the college degree, combining practical and academic subjects, was if anything perceived as harder. And the students were a lot nicer. One said: "We are not an ivory tower and can't live off our reputation like universities which only rich people with dodgy attitudes can afford anyway."

Mr Gibson concludes that there is an important demand to be met by further education. And he for one intends to keep meeting it.

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