Twenty new university campuses serving 10,000 students are to be built in England over the next six years in a drive to ensure that no region is left without access to higher education.

John Denham, the Universities Secretary, will today invite local authorities and regional development agencies to enter a “university challenge” to bid for funding for a campus or college in their area.

The facilities could be linked to an existing university or further education college or be entirely new. They are planned as part of a wider drive to increase the number of young people going into higher education from 43 to 50 per cent.

Mr Denham said yesterday that the 17 university teaching blocks and campuses opened or planned since 2003 in locations from Cornwall to Cumbria had shown that local universities could play a key role in boosting economic regeneration.

“Communities should have the chance to show they can make the most of the power of higher education, to help unlock the talent of their local people and help make them better off,” he said.

The Higher Education Funding Council for England had set aside £150 million from its development fund for the expansion programme.

David Eastwood, its chief executive, said: “Such developments can have a profound impact on economic regeneration as well as transforming the lives of students with no previous experience of higher education.”

Mr Denham sees university growth as a key driver of economic expansion. He estimates that a 1 per cent increase in a country’s population educated to degree level increases GDP growth by six percentage points.

Higher education contributes an estimated £50 billion to the economy a year and graduate unemployment is 2.9 per cent compared with 6 per cent for the whole population.

As about five million adults of working age with A-levels or equivalent qualifications have not continued to degree level, Mr Denham believes that the potential for growth is considerable, particularly in areas with no current university provision.

New university campuses or other local higher education centres that have received capital funding since 2003 include Barnsley, Cornwall, Cumbria, Folkestone, Hastings, Medway, Oldham, Peterborough, Southend, Suffolk and Darlington. Projects with agreed funding are in Blackpool, Blackburn, Burnley, Everton, Grimsby and North and South Devon.

The expansion plans follow the announcement last week that the Government is preparing a blueprint for university reform ahead of the review of tuition fees in 2009.

Mr Denham is concerned that British universities risk losing their world dominance unless they change. Britain has four universities rated among the top ten in the world by Times Higher Education and is the second most popular destination for overseas students after America.

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