A proposal for the Learning and Skills Council to stop funding the health and care costs of education packages for people with learning difficulties or disabilities is being discussed in government.
As part of a review of provision for over-16s last year, the LSC argued that millions of pounds of its funds could be "freed up" for learning if other agencies met health and care costs.
Last week, an LSC report on responses to a consultation on the review revealed concerns over the impact on primary care trusts and local authorities if the council withdrew funding for health and care elements of education packages.
The report said it was essential that other agencies received extra ring-fenced funding if this happened.
It also said the Department for Education and Skills had started talks on the LSC's spend on health and care costs to work out funding responsibilities.
Organisations supported other recommendations from the review, including legislating on transport for people older than 19 with learning difficulties or disabilities.