Education and skills secretary Charles Clarke has told employers they need to invest in further education to fill skills gaps, and that the Government "cannot and should not be expected to fund everything".
Speaking at the Association of Colleges' Annual Conference, Charles Clarke said that as personal beneficiaries, employers and students should contribute more to course development.
"That is not meant to be a threat. It is simply the reality," he said. "Even with the extra public investment, the overall pot of funding needs to grow. That means diversifying income sources, finding new business, and collecting more income from fees.
"Greater college and employer collaboration is not just about fees and income," he added. "It is also about ensuring that the needs of employers are understood and met, so they are confident that learners are equipped with the necessary skills, knowledge and attitudes.
"Likewise, it is about giving learners the confidence that their education gives them prospects in the future economy and society. To achieve this, employers need to contribute more to course development so that the supply side is geared up to provide what they want, when they want, and where," Clarke said.
He added that the Sector Skills Councils would be key in providing an important new voice in identifying the skills the UK needs to drive up productivity sector by sector.