College funding chiefs have recommended special funds to encourage colleges to tackle "persistent weaknesses in student achievement", but have rejected calls for a more direct link between the funding methodology and students' successes.
A working group of the Further Education Funding Council, conducting a long-term fundamental review of the funding methodology for colleges, has said that as well as cash, "a number of other factors influence student retention and achievement".
Lecturers' union Natfhe has warned that colleges are so preoccupied with the cash rewards for enrolment that they are ignoring their students' achievement. There have been calls for extra money based on students' achievement of qualifications.
But the funding council working group has said "it is not convinced that a change in the balance of units in the tariff to increase the achievement element is needed at this point".
The group said: "There are concerns that such an increase would result in unintended and undesirable consequences and might hinder attempts to widen participation among those with limited educational experience.
"Output-related funding in other sectors tends to lead to pressures to select only those students most likely to succeed," the group said. This conclusion runs counter to Natfhe research.
In its submission to the House of Commons' education select committee report on further education last year, Natfhe said that the funding system encouraged colleges to allow students on to courses "beyond their capability" to boost numbers, and that there was insufficient incentive for colleges to tackle poor achievement rates.
The FEFC group said that when the full modularised qualifications framework comes on stream, it will allow students to accumulate "more readily completed chunks" of qualifications, and consequently achievement rates will improve.
The FEFC said that institutions should have clear targets for improving levels of achievement, and that internal quality assurance systems should "take proper account of why students fail assessments".
It said that there should be "special funds" for attention and achievement, but that the sector should be consulted on any "top-slicing for specific purposes".
For the longer term, the group recommended that another group should be set up "to look beyond the preoccupations of the moment" and plan for major changes to the methodology in 2000-2001.
The FEFC team said that it "hopes" that the government will find more money for further education, but warned that "funding will remain tight".