This document, which is intended for senior staff at the United Kingdom's further education (FE) colleges, examines the content and possible impact of recent government proposals to change how school sixth forms are funded. The following are among the topics discussed in sections 1-8: (1) reasons underlying the talk about change; (2) existing funding policies for the entry and on-programme phases and funding related to learners' achievements; (3) lessons schools can learn from FE (retention, achievement, and guidance; tariff farming; narrowing participation); (4) lessons schools can learn from the pilot schemes run by various local education authorities (LEAs); (5) implications of a new approach for LEAs; (6) two possible ways funds for school sixth forms could be decided (LEAs would continue to decide funding or the Learning and Skills Council would fund LEAs); (7) a possible model for a new approach and case studies illustrating the model's impact at three hypothetical schools; and (8) ways schools can best meet the challenge of funding reform (implications for senior management teams and governors, implications for school practice, implications for parents and students). Appended are spreadsheets showing the calculations underpinning the figures provided in the case studies. (MN)