Although Farnborough College has 1,100 higher education students and offers a wide range of degree, foundation degree and even masters courses, it has decided not to submit an access agreement and will keep fee levels at a maximum £1,200 for 2006.
Christine Davis, the principal, said: "We feel there is going to be a great deal of market turbulence in the coming year. We are very aware that these are uncharted waters, and we need to keep our ship as steady as we can. But we are also aware that funding levels may force us to reconsider our position in the future."
Ms Davis said her college felt able to charge less because its courses were purely vocational and therefore did not overlap with its validating partner, Surrey University. "The local market is key. If you have a niche area you can make different decisions," she said.
Suffolk College is one of the few further education institutions to have submitted an access agreement, with the intention of charging £3,000 a year for its higher education courses.
It plans to spend 37 per cent of an anticipated extra £837,000 fee income on student bursaries ranging from £500 to £1,350 a year. About half of the college's 2,000 higher education students are expected to qualify.
Dave Muller, the principal, said his college's relationship with its validating partner, the University of East Anglia, had influenced its decision.
"Our judgement was that it would look very odd to be charging different fees for almost the same provision," he said.