DURING AN INST TRAINING FLT; THE STUDENT FAILED TO SET THE ALTIMETER PRIOR TO DEP. THE INSTRUCTOR PLT DID NOT NOTICE AND THE FLT RECEIVED NO OTHER ALTIMETER SETTING. THE ACFT WAS LEVELED OFF 1100 FT HIGHER THAN THE ASSIGNED ALT.

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THE STUDENT WAS ESPECIALLY NERVOUS BECAUSE IT WAS HIS FIRST TIME IN THE IFR SYS; TALKING TO A CTLR. HE WAS ERRATIC IN HIS CHKLIST; ON WHICH I CORRECTED HIM MULTIPLE TIMES. WE TOOK OFF TO CIRCLE AND CLB ABOVE THE ARPT TO PICK UP THE IFR CLRNC. DURING THE CLB (ALL IN VMC) I NOTICED WE APPEARED HIGHER THAN WHAT WE INDICATED. I KNEW THAT UPON LEVELING OFF WE WOULD GET AN ALTIMETER SETTING IF WE DID NOT GET OUR CLRNC IN THE CLB AND THE NEEDED ALTIMETER SETTING TOO. ABOUT 2500 FT MSL WE WERE GIVEN A SQUAWK AND TOLD TO RPT ON ANOTHER FREQ. CLBING TO OUR ALT OF 4000 FT; BUT NO ALTIMETER SETTING. UPON REACHING OUR NEW DEP FREQ AND SIGNING ON; WE LEVELED AT WHAT WE THOUGHT WAS 4000 FT. WE WERE GIVEN OUR RTE OF FLT; ALT AND ALTIMETER SETTING. ALL IN THE SAME SENTENCE HE GAVE THE SETTING AND TOLD US TO RPT OUR INDICATED ALT; WE REPLIED 4100 FT. HE SAID; 'CHK OUT ALTIMETER SETTING;' WE WERE SHOWING 5100 FT. I LOOKED AT THE KOLLSMAN WINDOW; AND SAW IN SHOCK; WE WERE OFF -- WAY OFF. I IMMEDIATELY STARTED A DSCNT; AND IN THE DSCNT I CORRECTED THE ALTIMETER SETTING. AFTER CORRECTING THERE WAS NO FURTHER PROB. THE WHOLE EPISODE COULD HAVE BEEN AVOIDED IF I HAD PAID MORE ATTN TO EVERYTHING THE STUDENT HAD BEEN DOING AND HAD BEEN ALERT TO THE FACT THAT THE ALTIMETER WAS SET AT AN INCORRECT FIELD ELEVATION. A VERY HIGH PRESSURE HAD MOVED INTO THE AREA AND I THINK ALL THE FLT SCHOOL ACFT WERE WRONG. THE INST ACFT WAS TAKEN OUT HRS BEFORE BY ANOTHER STUDENT; SOLO! UPON QUESTIONING OTHER INSTRUCTORS; I GOT EVERYTHING FROM THEY NEVER NOTICED; TO YEAH; WHAT'S THE POINT? NEEDLESS TO SAY EVERYONE ON DUTY GOT A QUICK CLASS IN ALTIMETRY.