Universities must inform the police if they suspect that their students or staff are indulging in extremist activities, the Government said today.

In a speech to vice chancellors and representatives from more than a hundred universities, Ruth Kelly, the Education Secretary, said academic institutions had a responsibility to watch out for "unacceptable behaviour" on campus.

"Following the London bomb attacks in July, we are all having to re-examine certain policies," Ms Kelly told a meeting at Universities UK, an umbrella group of British academic institutions.

"I believe that higher education institutions need to identify and confront unacceptable behaviour on their premises and within their communities," she said.

"That means informing the police where criminal offences are being perpetrated or where there may be concerns about possible criminal acts.

"Institutions have a duty to support and look after the moderate majority as they study, to ensure that those students are not harassed, intimidated or pressured," said Ms Kelly.

University leaders reacted uneasily to the idea of closely monitoring the behaviour of their students but Professor Drummond Bone, the president of Universities UK, said it was important to protect students from bullying extremists.

"I don’t think any university feels entirely happy about having a policing role over its own members," he said. "We are in a difficult situation and we recognise the context we are working in."

"Everybody is worried. Universities are particularly intense communities, they are particularly diverse as well. Everybody wants to make sure that no-one is intimidated or bullied by extremists."

The use of university facilities by extremists looking to radicalise young Muslim students has come under scrutiny since the London bombings.

Although the National Union of Students banned two radical groups, Hizb ut-Tahrir and al-Muhajiroun, which has now dissolved, from its campuses before the attacks took place, the Government is determined to stop other organisations taking their place.

In the proposed Counter-Terrorism Bill, clauses of which were published for the first time today, the Government has set out tough new laws to punish people who glorify terrorism anywhere in the world.

"There are a range of groups which whilst not involved in committing acts of terrorism, may provide succour and support to it, this furthering radicalisation," the Home Secretary wrote in a letter accompanying the draft bill today.

"Whilst we do not want to penalise organisations where a stray member may on occasion glorify a terrorist act... We do want to demonstrate that it is not acceptable for organisations in this country systematically to foster that sort of climate," he wrote.

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