Dear Ron, It is now public knowledge that a number of major universities are considering forming a premier league and preparing themselves for the measures that would have to be taken to bring it about. It has also been reported that the truth of the current situation has at last reached ministers and they may be willing to look at the issue afresh and recognise that the parlous situation which has been created as a result of listening to officialdom in the old Department of Education and Science and new Department for Education and Employment cannot be allowed to continue.

I feel able to try to answer the question of how we get from here to there supposing the new goals are accepted, because I can at least claim to have forecast a long time ago the inevitable confrontation between the state as the universal paymaster and universities whose strength lies in part in their traditions of autonomy. This problem was spelled out by myself (and some others) in the 1960s. One result of our conviction was the foundation of what is now the independent University of Buckingham which celebrated its 20th anniversary in July.

When the project was mooted, the idea that a university could dispense with direct government funding and rely on private endowments and student fees was regarded as sacrilege by much of the university community. It was as though we had suggested introducing human sacrifice into the ritual of the established church. Now Buckingham's main fund-raising problem is that all the universities that condemned its search for private funds vie with it and each other to do the same, while student fees in some form look certain to be on the the agenda of the major universities and may soon be taken for granted, as they are among their rivals in the United States. No one seriously doubts that students and their families will in future have to pay part of the cost of getting the graduate status which will secure higher earnings for them in the future. Only the type of scheme is seriously in question, with Treasury obscurantism as an almost equal impediment to progress as the departmental biases of the DFEE.

What we did not fully foresee was that one aspect of government finance would loom as large as it does now. Since in the 1960s it was assumed that all universities would cultivate high standards and would have their own methods of ensuring them - getting the right external examiners was a key to Buckingham's taking off - detailed external controls were not thought to be necessary. Now, with the huge range of institutions entitled to call themselves universities, the machinery for controlling public expenditure has to be of a very detailed kind. Enormous amounts of time are wasted in major universities by having to fill in forms and undergo visitations on the premise that the University of Cambridge must be supervised in ways suitable for the University of Loamshire.

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The first step to the creation of a premier league must be the ending of this nonsense. The members of the league must be allotted appropriate sums of money, preferably for a quinquennium, and told to get on with their teaching and research. If after a lapse of time, it does not appear that some have fulfilled the trust invested in them, they must be demoted to the first division and others promoted in their place. Given that time and energy are the most valuable commodities among academics, this step would in fact increase their resources without any extra expenditure.

This growth in real resources would take time to make itself felt. The second step is to accept the fact that the research capability of major universities is an essential part of their contribution to the nation's well-being.

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The cuts in the allocations for capital equipment - laboratory instruments for the sciences, libraries for the humanists - which are crippling the major universities and which no private finance can remedy must be restored and even increased.

Since the taxpayer will not accept this additional burden, the money must come from within the higher education budget; the number of universities entitled to central funding for research must be limited and restricted to cases where a particular area of excellence can be identified. The best hope for Britain to retain its position in the world of science and learning lies in concentration. It is more important that the number of British Nobel prize winners should grow again than that thousands more "graduates" should be put on the labour market. Only where the science base is secure can British industry flourish in a competitive world.

Defenders of the expansion say that the national wealth is being enhanced by the wider dissemination of skills. That is true where it is in a vocational direction that the new universities excel - but even when they were still polytechnics there was a tendency to downgrade practical subjects. Now we have a rash of "media studies", "gender studies" and the rest, whose only contribution to the economy is keeping young people off the labour market for three or more years. As I recently said in the House of Lords to some approval, there is no justification for spending large sums of public money to enable third-rate students to attend fourth-rate institutions to study fifth-rate subjects.

This does not mean that the premier league does not have responsibilities to match the trust that would be given to them. If they claim excellence as the reason for raising funds (public or private) they must maintain it. There are disquieting signs that the egalitarian and trendy notions that have affected the system as a whole have found room within even the ancient foundations. The lowering of admission standards to match declining standards in secondary schools, some curious appointments in major fields of study and Oxford's absurd decision that everyone should be a professor (Lewis Carroll "All shall have prizes" was not an Oxford don for nothing).

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It is more important to safeguard tutorial teaching and through it to produce the elite of the next generation than to find a home for any branch of study however eccentric.

The first step for those who wish to constitute a premier league is to be elitist and proud of it. The nuts and bolts will follow.

MAX BELOFF Lord Beloff is founding principal of University College, Buckingham.