Top-up fees 'Plan B' put forward

Lord Puttnam said he was "80% satisfied" with top-up fee plans

The government should issue bonds worth £20bn in an effort to end the higher education funding crisis, a university leader has suggested.

Lord Puttnam, chancellor of Sunderland University, said this would mean £8bn for repairs and short-term spending.

The Labour peer, a former top-up fees rebel, told BBC Radio 4's Today that 80% of his "very real concerns" had been eased by government concessions.

A vote against the proposal would now "damage" universities, he added.

Extra help

Universities UK, which represents vice-chancellors, estimates higher education is facing a funding shortfall of £9.8bn.

Lord Puttnam, a film producer, was an outspoken critic of the fees proposals when they were announced in November's Queen's Speech, warning they would create "a wholly unwelcome marketplace" in higher education.

He objected to raising maximum annual tuition fees to £3,000, depending on the university and course offered,

The government has since promised extra help for poorer students, in the form of grants, fee remissions and bursaries.

These appear to have won back some of the anti-fees rebels ahead of the Commons vote.

Lord Puttnam said: "I am now convinced that the vote tonight, should it go against the government, will do far more damage to universities such as mine than good.

"I hope the rebels understand that, from the point of view of the students and the modern universities, they will be damaging us not helping us by voting against."

Education Secretary Charles Clarke has said there is no "Plan B" for funding.

But Lord Puttnam said a bond scheme, jointly underwritten by the universities and the state, would significantly improve short-term prospects for higher education funding.

He added: "There's been a softening of attitudes towards bonds. There's every indication that the Treasury is taking this type of proposal very seriously indeed."

A former leading rebel MP, the ex-agriculture minister Nick Brown, earlier said he would vote in favour of the Higher Education Bill.