§ Margaret Hodge
Colleges in the further education (FE) sector, including sixth form colleges, are independent corporations with their own pay arrangements. Colleges agree annual pay rises and conditions of employment with their staff in the context of local priorities and the overall resources available to them. There is a nationally recommended pay increase agreed by the employers' representative bodies and the unions but pay arrangements in the sector are diverse, reflecting colleges' local flexibility. Government have no plans to change this arrangement.
Extra resources have been made available to the FE sector. This year, £4.4 billion has been allocated to FE, an increase of £1.2 billion in five years. Within this, there is £142 million available for the Teaching Pay Initiative, 26W known as the Professional Standards Payment in sixth form colleges, which helps colleges to modernise pay arrangements and to recruit, reward and retain excellent teachers.
We have already announced that from next year and up to 2005–06 there will be a 1 per cent. annual real terms increase in core funding for FE and three year budgets for colleges which demonstrate their effectiveness. This, plus the additional resources for FE that my right hon. Friend the Secretary of State will be announcing in November to support our Success for All strategy, will present a more stable environment within which general FE and sixth form colleges can plan and negotiate pay levels and arrangements.