Education inspectors have highlighted "inadequate" provision at three further education colleges in England.
The colleges cater for tens of thousands of students
The three are West Herts College, Oaklands College and Reading College and School of Arts and Design.
The body representing the sector has expressed concern at "the apparent readiness with which Ofsted brands further education colleges as failing".
West Herts College is also now in dispute with its staff over plans for cost-cutting redundancies.
"Leadership, management and governance are very weak," the inspectors concluded after their visit in December last year.
"Managers and governors have not set a clear strategic direction for the college and they have failed to address long-term and serious weaknesses effectively in finances, accommodation and the curriculum."
The inspectors said the principal, Andrew Bragg, was not in college until the last day of their visit.
The previous day, after five years in post, his employment had been terminated by "mutual agreement" after the governors had taken legal advice.
"However, despite the poor performance of the college, the termination agreement included provision for a substantial payment to the principal," the report said.
"It is inappropriate for such a payment to be made in these circumstances."
The new principal, Tony Pitcher, said most of the criticism was directed at the way the college had been managed in the past.
"But that is not to under-estimate the scale of the task we face. We have a large financial deficit, we are undergoing a major college re-structuring and there will be job losses."
Lecturers at the college have declared a dispute with the current management over the plans to cut more than 100 jobs.
"Staff at West Herts College have faced the threat of redundancy every year for the last three years as the college attempted to balance its budget," said their union, Natfhe.
Workloads had soared and morale was low.
The union's regional official, Elizabeth Martins, said Mr Pitcher had jumped the gun in announcing redundancies without proper consultation.
But the college said that Mr Pitcher had in fact spent his first seven weeks listening to the views of staff before responding to the governing body's requirement for decisive action.
Instead of attending consultation meetings the unions seemed to prefer "public gesturing", Mr Pitcher said in a statement.
Inspectors judged Oaklands College, also in Hertfordshire, "inadequate to meet the needs of all students".
Six of the 14 curriculum areas and leadership and management were unsatisfactory.
"Governors give strong support to the college and the new senior management team is giving clear direction about the future," the report said.
Senior management had made progress in strengthening the college's finances but the quality of provision had deteriorated.
Reading College and School of Arts and Design - which has since become part of Thames Valley University - was also said to be "inadequate".
"Leadership and management at the college are unsatisfactory and the college does not provide value for money," inspectors said.
The Association of Colleges said it was "increasingly concerned about the apparent readiness with which Ofsted brands further education colleges as failing".
Nearly 90% of local colleges achieved overall satisfactory or better inspection results for their four million students and £4bn of public funds, and quality was improving, said its chief executive, John Brennan.
A survey of 10,000 students in 2002 for the Learning and Skills Council had shown 94% satisfied with their college experience.
"Such dissonance with Ofsted's 'failure' judgements inevitably casts doubt on their methodology, which assesses colleges with a huge range of courses and students - mostly adults - in the same ways it uses for schools," he said.
Colleges were increasingly concerned at the lack of FE experience of the many "part-time and sometimes transient" Ofsted inspectors.