Further education in Wales has been described as bouyant after nearly Pounds 150 million was awarded to colleges for an 8 per cent expansion next year.

But the squeeze on providers to become more efficient will continue, since this sum represents just 4 per cent extra money. The growth the 30 Welsh further education colleges have made a bid for exceeds the Government's 6 per cent target, and means that 26 of them will receive more cash than last year.

Significant extra funding is being given for increasing participation from deprived areas, weighted on students' postcodes. Other growth areas include courses delivered in Welsh, provision for adult learners and training initiatives such as the Modern Apprenticeship scheme.

"There is still a significant level of growth in the Welsh sector, albeit the position for post-16 full-time students is increasingly competitive," said John Andrews, chief executive of the Further Education Funding Council for Wales.

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"The growth that colleges are bidding for is very encouraging and in that sense further education in Wales is bouyant," he said.

"However, funding is tight and the level of efficiency gains at this level of growth is significant."

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The college with the biggest year-on-year cut, of 8 per cent, is Coleg Harlech in Gwynedd, which was traditionally funded at a higher level when under local authority control.

All four colleges which receive lower allocations than last year are in the process of converging to the standard unit of funding which 20 of the Welsh colleges have reached, as have nine of the 12 higher education institutions with further education provision.

Extra money was linked to students from areas of socio-economic deprivation for the first time this year, which saw participation increase from 32,420 in 1993-94 to 42,055.

Next year there is a 24.5 per cent increase in funding associated with participation from deprived areas, as well as 26.6 per cent more for Welsh medium provision.

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Mr Andrews added that linking funding with attainment saw a 48 per cent increase in National Training and Education Target related qualifications last year.

The overall number of students funded by the Welsh council has grown from 102,150 in 1992/93 to 137,053 in 1993/94 to 144,259 this academic year.

Huw Evans, chairman of the Fforwm of Welsh colleges, said: "We are generally very satisfied with the allocations.

"The majority of colleges in Wales are showing quite significant increases in funding across the board and in return the colleges are exceeding growth targets."

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