At least two colleges face the threat of sanctions under the government's new stand against failing colleges.
Senior managers at Kidderminster College in Worcestershire have already initiated remedial action after inspectors found that the college governors were largely unaccountable and that its senior managers had failed to deal with plummeting student achievement rates. "Special measures" will be imposed by the FEFC if it fails a follow-up inspection.
And at Wirral Metropolitan College, the Further Education Funding Council has demanded by mid-January a rescue plan, designed to tackle a potentially disastrous financial crisis that appears to have led to last month's early retirement of principal Jenny Shackleton.
The college faces the threat of the mass sacking of its governing body under rarely-used powers invested in the secretary of state for education, sources close to the crisis have confirmed.
Kidderminster College was this week judged by FEFC inspectors to be failing in three crucial areas of provision. Its governance was given the lowest possible inspection grade, poor; while its management and quality assurance provision were deemed to be "less than satisfactory".
Inspectors found that student pass rates had fallen from 93 per cent in 1995 to 47 per cent in 1997.
An FEFC spokesman said that the college will be reinspected within 12 months, and if it fails in any of the inspection categories again, will be subject to "special attention".
Kidderminster governor Jock Gallagher said: "The inspection came at exactly the wrong time. We got a new principal in April and were overhauling the management structure when the inspectors arrived in October. Many changes had not kicked in. We were clobbered for stupid reasons. The inspectors were fairly savage in their criticisms, and we can only take it on the chin."
He said that changes were "very much in hand. We will be ready for the inspectors later this year," he said.
At Wirral, remedial action is urgent. The FEFC confirmed this week that it has asked the college to produce a revised strategic financial plan by January 15. The college has been beset by "huge" financial deficits and the FEFC has "been in regular correspondence with the college over a number of months".
The college's plans to rationalise its campuses for financial reasons have been strongly resisted by local MP Ben Chapman. Plans to sell one of the college sites have already been blocked by the FEFC and referred for consideration by its regional committee in Manchester.
Outgoing principal Jenny Shackleton was not available as The THES went to press.