The Government today called on teachers, lecturers and council employees to help root out Islamic extremism in schools, colleges and universities.

In defiance of the growing anger of Islamic leaders, Ruth Kelly, the Communities Secretary, insisted that those at the grassroots of society must join the fight against those who would radicalise British youngsters.

In a meeting with key council leaders Ms Kelly demanded that they use their local knowledge to identify "hotspot" sections of the community which could be a breeding ground for extremists.

She also said that they needed to look at new ways they could tackle the threat of extremism within education.

As part of the campaign the Department for Education has prepared plans to ask university staff and lecturers to inform police of Muslim and "Asian-looking" students they suspect of involvement in supporting terrorists.

An 18-page document due to be sent to universities and colleges by the end of the year expresses concern over Islamic societies and students from "segregated backgrounds".

Ms Kelly said: "It is about protecting students. There is a need for the strong monitoring of activities to make sure individual students on campus are protected.

"The world has changed since September 11 and 7/7. The Government has had to change and respond to that, and we appeal to local authorities to do the same."

The announcement comes after the revelation that new faith schools could be forced to offer a quarter of their places to pupils of other religions and amid continuing rows over the use of veils by Muslim women.

Alan Johnson, the Education Secretary, is expected to suggest that opening up admissions to faith schools would help to ease racial tensions and give parents more choice. The move comes after a proposal this month by the Church of England to open up voluntarily 25 per cent of places in all its new schools to children irrespective of their religious beliefs.

The changes are likely to prove more controversial with Roman Catholics and Muslims. Critics of faith schools have long complained that they are exclusive and divide society, rather than promoting cohesion. About a third, or 7,000, of all state schools in England have a religious ethos, mostly Christian. Four-fifths of the top 200 state secondaries are faith schools.

Mr Johnson will table an amendment to the Education and Inspections Bill when it returns to the Lords this week requiring new faith schools to reserve a quarter of their places for non-believers or children of other faiths. The change would place the initial decision about a school’s intake in the hands of the local education authority (LEA), enabling it to demand that up to a quarter of its places are open to families of different or no faiths.

Controversy also still surrounds the case of a Muslim teaching assistant who has been suspended after refusing to remove her veil in the classroom.

The Government’s race minister, Phil Woolas, accused 24-year-old Aishah Azmi of "denying the right of children to a full education" and demanded she be sacked.

The Muslim Council of Britain condemned Mr Woolas for his "outrageous" and "reckless" comments.

The head of the Council, Muhammad Abdul Bari, has written to Ms Kelly complaining that a recent "drip feed" of ministerial statements over the issue has "stigmatised" the entire Muslim community.

He said: "What is happening, especially in the last few months, has been a barrage of demonisation of the Muslim community to such an extent that the community is now scared and the whole community feels vulnerable.

"Ministers are not helping in this discourse within the Muslim community. What, simply, they are doing is trying to undermine and marginalise further Muslim community, especially those organisations which have been working so hard for community cohesion."

But speaking after her hour-long meeting with council leaders, which was also attended by senior Metropolitan Police officer Andy Hayman, Ms Kelly insisted it was essential for people to continue to speak out on the subject.

She said: "I think we need to be strong enough as a society to debate these issues and it is far more difficult if people feel there is an imposed sense of restraint.

"It’s far better to debate the issues than sweep them under the carpet when the question of children’s education is at stake."

Paul Mackney, the joint general secretary of the University and College Union, said that they were deeply concerned about the Government’s plans.

"We expressed concern that we were being sucked into a kind of Islamic McCarthyism which has major implications for academic freedom, civil liberties, and blurring of the boundaries between the illegal and the possibly undesirable," he said.

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