Further education funding chiefs have spelled out exactly when they would intervene in the management of a "failing" college and when closure would be a possibility.
Guidelines published by the Learning and Skills Council this week also list the sanctions that can be brought to bear by the LSC or the secretary of state on a college that fails to address or correct weaknesses.
Early steps will be taken to deal with weaknesses or areas of concern arising out of performance reviews conducted by local learning and skills councils, the guidelines say. Where support and guidance from the LSC does not bring improvement, the LSC will intervene.
An LSC circular lists "key indicators" that the threshold for "major intervention" has been reached, including "serious" concerns raised at performance review; a college refusing to recognise its weaknesses; provision that is inadequate overall; a college failing to produce an adequate post-inspection action plan; or guidance and support from the LSC being ignored or rejected.
Under such circumstances, the LSC could impose specific conditions of funding related to an action plan; appoint additional governors to help see through required changes; or ask the secretary of state to intervene - with the possibility of shutting down a college or forcing a merger.
The circular was issued as college heads condemned "deliberate misinformation" about college performance used by lifelong learning and higher education minister Margaret Hodge in a speech and media briefings last week.
The Association of Colleges has disputed claims from Ms Hodge that one in five further education students drops out, that students have only a 50:50 chance of achieving their aims and that four in ten colleges need to be reinspected in at least one curriculum area.
Rosemary Clark, the AoC's quality manager, said figures in an LSC report showed that colleges had an 87 per cent student retention rate and a 77 per cent achievement rate, and out of 212 curriculum areas inspected by Ofsted so far, only 10 per cent had to be reinspected.
In a letter to Ms Hodge, AoC chief executive David Gibson complains that she had used "ill-conceived and dangerously misleading information". And he adds: "I fail to understand how the country will be enthused with an appetite for lifelong learning when the minister responsible for it chooses to launch an attack on its principal providers."
Avril Willis, the LSC's quality and standards director, said the performance criteria would be used to celebrate success as well as to identify weaknesses.
But she added: "We must not forget that we have an overriding responsibility to the learner, and if there are persistent weaknesses or we have serious concerns, we will not hesitate to take action."