The Learning and Skills Council pledged to cut red tape but so far, Neil Merrick discovers, colleges have seen little effect. Is bureaucracy a cross they will have to bear?

Earlier this year, Wiltshire College received £200,000 from the European Social Fund to lay on more opportunities for learning in rural areas.

Under new - supposedly simpler - funding arrangements, the application for funds was made on behalf of the college by Wiltshire and Swindon Learning and Skills Council. But to gain the money, the college had to provide its LSC with information about 2,000 learners - only 10 per cent of whom were directly affected by the project.

According to the college principal, George Bright, the time spent on data collection scarcely made it worth making the bid. "We won't get involved in another," he says. "It's not worth the income you obtain."

Colleges have been involved in a running argument with the Learning and Skills Council over bureaucracy ever since the LSC was set up in April 2001. The new council promised there would be less red tape than under its predecessor, the Further Education Funding Council, but initially things got worse rather than better.

Last month, at the Association of Colleges' (AoC) annual conference, the LSC's bureaucracy task force declared that the mountain of paperwork was finally on the move - partly due to "light touch" audits introduced by the LSC for about one in four colleges. But the AoC is unimpressed by the task force's claims that the new system of gaining European Social Fund money - known as "co-financing" - is an improvement. John Brennan, the AoC's chief executive, says Wiltshire College is not alone in deciding that the hassle of making applications through a local LSC means the exercise is not worthwhile. "It does not seem to be in the least bit simpler," he says.

According to George Bright, his college used to spend an average of 15 minutes collecting data on each student to satisfy LSC rules. That has now doubled to half an hour for each student, he says.

At Stourbridge College, the principal, Sadie Walton, is equally frustrated. In particular, she blames poor communication in her local LSC that means her college is frequently asked for the same information more than once. Excessive target-setting adds to the problem. Meanwhile, the college struggles to claim money for widening participation because it cannot gain all the information required.

"We can spend days filling in information," says Walton. "A lot of students don't want to say that they have a disability or describe their ethnic origin."

Condemnation of the LSC is by no means universal. Peter Pendle, the chief executive of the Association for College Management, says that it has made important strides to reduce bureaucracy but it will take time before colleges notice all the effects. The key thing, he says, is to simplify funding. Consultations are taking place over a new system, based on three-year development plans, to come into force next summer.

Most principals are pinning their hopes on Mark Haysom, the LSC's new chief executive, whose private sector background may give him more chance of reducing government red tape. "He is making all the right noises," says Pendle.

Bill Grady, the principal of Isle of Wight College, is full of praise for the way that his local LSC allowed the college to "re-interpret" how it counts learners so that it can claim money more easily. When Grady took over two years ago, the Isle of Wight college had debts of £1.8m and was reeling from a poor inspection.

With just 130,000 people on the island, the college has a greater struggle to attract students than mainland colleges. The LSC allows him some leeway in how he counts learners at the college with the result that funding has increased. "We've had a positive response from the local and national LSC," he says.

There is certainly no lack of interest in reducing red tape. In addition to the bureaucracy task force, which is now focusing on private trainers and employers, the LSC has set up a bureaucracy review group, which will try to prevent red tape creeping back into colleges.

The Prime Minister's better regulation task force has also cast its eye over post-16 learning and published a highly critical report in 2002. It is re-interviewing college principals, employers and other stakeholders to see if things have improved.

Carshalton College in Surrey is one of 117 colleges that is now eligible for a "light touch" audit. Colleges were selected because they have a good record of providing management information and claiming funds. David Watkins, the principal, is still unsure exactly what it will mean but is optimistic of reduced paperwork. "There are a lot of ideas out there but what we now want is to see some action," he says.

Sir George Sweeney, the principal of Knowsley College and chair of the LSC bureaucracy task force, says his college has already noticed the benefits of less audit. He also claims co-financing has made it easier to access European Social Fund money.

Sir George is irritated that principals fail to see things are improving - even though his own task force acknowledged that improvements take time. "Trust is a two-way business," he says. "I would urge college principals to actively engage with their local LSC."

In spite of the efforts of Sir George and his task force - described as "noble" by one principal - there is also a recognition that red tape is almost bound to go hand-in-hand with any publicly-funded service. John Smith, the principal of Burnley College, believes that the finger of blame should be pointed higher than the LSC. "The Government is wedded to multiple targets," he says. "It does not have any trust in those on the ground to deliver services in an honest and effective way."

Charting the paperchase

April 2001: Learning and Skills Council launched with promise to simplify funding and reduce red tape.

November 2001: John Harwood, chief executive of the LSC promises to cut bureaucracy by 25 per cent.

January 2002: LSC bureaucracy task force starts work.

July 2002: Prime Minister's better regulation task force criticises complex funding streams and other bureaucracy in post-16 learning.

November 2002: Bureaucracy task force makes wide-ranging recommendations, including a new relationship of trust between colleges and the Learning and Skills Council.

February 2003: Red tape review extended to private trainers and employers.

April 2003: LSC announces first 20 colleges for "light touch" audits.

June 2003: Reduced audits extended to a further 97 colleges. Three LSCs chosen to fast-track "Success for All" reforms, including three-year funding agreements.

July 2003: Bureaucracy review group set up by the LSC to act as "gatekeeper" and oversee the task force's recommendations.

October 2003: Consultations begin on new system of "plan-led" funding.

November 2003: Bureaucracy task force concludes that red tape is reducing, but the impact is still to be felt throughout the sector.