Proposals for common funding arrangements for all education and training for 16 to 19-year-olds will go to ministers next month, as pressure mounts to close the funding gap between further education colleges and school sixth forms.
Preliminary plans, drawn up by the Further Education Funding Council and the Local Government Association, have already been warmly received.
In a letter to FEFC chairman Bryan Davies and LGA education committee chairman Graham Lane last month, education minister Tessa Blackstone said "work is in hand to examine the scope for introducing common principals into sixth-form funding".
The current system leaves FEFC-funded sixth-form colleges about 20 per cent worse off than the school sixth forms funded by local government.
The FEFC and LGA will meet the Training and Enterprise Councils next month to finalise detailed plans for a full convergence of 16-19 funding.
"We want funding for this group of students to be the same whatever the institution," said Mr Lane.
The group will propose the establishment of regional forums, with pooled sovereignty, made up of FEFC, local government, and TECS, which will plan and fund all 16-19 provision.
Mr Lane said the new system would put an end to the funding of school sixth forms based simply on student numbers. Funding will take into account retention rates as well as the value of the courses to the region. Some school sixth forms would be forced to close, Mr Lane has acknowledged.
Michael Bichard, permanent secretary at the Department for Education and Employment, has also said the issue is being addressed, but that it was "very complex". Grilled by MPs at a meeting of the Commons' Public Accounts Committee, who said that there should be "a level playing field" between schools' sixth forms and the colleges, Mr Bichard warned that school sixth forms would suffer.
Mr Lane said that the convergence could be "moving by September 1999" on a voluntary basis.