Abstract
The funding methodology by which the Scottish Office Education and Industry Department disburses funds to Scotland's colleges of further education is about to change. The proposed changes are explained in this article with particular regard to the educational values that are encouraged by the changes. The article is a case study of the relationship between government funding and values that may be of interest beyond Scotland. It is argued that it is difficult to fund public sector educational institutions in a justifiable way without government having some idea of the educational values that it seeks to communicate. In that regard the recent decision not to publish the long promised White Paper on lifelong learning is disappointing in that it leaves the various providers of post-compulsory education likely to be overconcerned with commercial rather than educational values.