MPs say the Welsh economy could be adversely affected if a funding gap is allowed to widen
The future of higher education in Wales is uncertain, if a core funding gap between Welsh and English colleges is not tackled, a group of MPs has warned.
A report by the Welsh Affairs Select Committee found there was an investment gap of £61m in the year ending in 2006.
It also found problems in policy-making between Whitehall and Cardiff.
The assembly government said funding was on a par with England, it had provided £449m this year and introduced ways to increase funding opportunities.
The report also found problems of communication and effective policy-making between Whitehall and Cardiff.
"There is a need for officials within Whitehall to have a better understanding of devolution as there is an impression that some officials believe that it means that they can 'forget' about Wales," said the report.
"Similarly there is a need for officials and ministers in the Welsh assembly to take a greater interest in developing policies across the border."
SUMMARY OF FINDINGS
There are now "significant differences" between further education policies in Wales and in England, and steps are needed to ensure that cross-border access is maintained and encouraged
If a funding disparity - £61m - continues, higher education institutions in Wales will become unable to compete effectively with colleges elsewhere in the UK and the EU
"Confusion" with the UK department of education having some UK-wide responsibilities and others England-only - "full consultation" needed with assembly government in early stages of policy
The decision-making processes on each side of the border needs to be "more coordinated, more coherent and more transparent"
There is a need for officials within Whitehall to have a better understanding of devolution as there is an impression that some officials believe that it means that they can 'forget' about Wales
The Wales-England border should be a "cause for celebration and cooperation rather than an obstacle to efficiency and effectiveness"
Devolution provides an opportunity for Wales to do things differently..but the objective must be to do things better for the sake of learners "rather than being different just for the sake of it"
Source: Welsh Affairs Committee - "Cross-border provision of public services for Wales: further and higher education"
In the report, the MPs predict a negative impact on the Welsh economy if the country's higher education continues to receive proportionately less core funding than English institutions and a smaller relative share of UK research funding.
David Jones, the Conservative MP for Clwyd West and a member of the committee said Wales would have to divert resources if it was going to grow an "effective higher education sector".
"How the Welsh Assembly Government does that is a matter for the Welsh Assembly Government but I think what they've got to do is recognise from the contents of this report that there's is a big problem that is not just highlighted by the Welsh Affairs Select Committee but is also being highlighted by the university authorities themselves."
The report claims that a lack of investment will also make institutions in Wales less attractive because the quality of teaching staff and available resources will be affected.
The committee wants the UK's Department for Innovation, Universities and Skills (DIUS) to make funds available to develop research in economically deprived areas.
It also calls for more effective communication between government departments and the assembly government to avoid confusion over further and higher education policy.
Ben Gray, president of the National Union of Students in Wales said: "If I walk onto an English university campus I can see the difference in the buildings, I can see the difference in where the investment's been spent.
"I think it's clear to see from the research assessment exercise that just got released that Wales is performing incredibly well in terms of it's teaching quality and research capability," he added.
But the assembly government disagreed with the committee's findings and have claimed the level of funding is on a par with English levels.
A spokesperson said: "Evidence suggests that we spend a comparable amount per head of population as in England.
"In 2008-09, we made £449m available to higher education institutions via the Higher Education Funding Council for Wales.
"We have also introduced a number of initiatives to increase the opportunities for funding available to higher education institutions in Wales, such as a new scheme to encourage Welsh universities to increase and expand their fundraising capacity."