A privately-owned online provider of UK university qualifications has been granted degree-awarding powers and now hopes to become a distance learning university.

Resource Development International, which is part of the US for-profit Capella Education Company, said it has been given taught degree-awarding powers by the Privy Council following assessment by the Quality Assurance Agency.

Based in Coventry, RDI has been operating distance learning courses for more than 20 years. It offers online courses developed by its partner institutions: Anglia Ruskin University, Bradford University School of Management, Birmingham City University, and Edexcel.

It will now able to develop its own degree programmes, and chief executive Phillip Hallam said it would also be applying to become a university.

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¡°We are now entering an exciting phase in which we will apply for university title and develop our own new programmes to meet growing UK and international demand for our provision,¡± he said.

Questions were raised about RDI application for degree-awarding powers when in 2011 it was purchased by Capella in a ?9.3 million deal. At the time, the US company said it would pay a further ?4 million premium if RDI was granted degree-awarding powers by July 2016.

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Critics suggested that Capella should have had to apply?for degree-awarding powers itself, given it was now the parent company.

RDI said in statement that it was ¡°anticipated¡± that the ?4 million payment would now be made ¡°subject to the conditions¡± of the original agreement.

Speaking after the degree-awarding powers were conferred today, minister for universities and science David Willetts said the government was ¡°keen to encourage greater competition and diversity in higher education provision¡±.

¡°It is right that institutions like RDI, that have met the rigorous standards required, should be granted the power to award their own degrees,¡± he added.

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chris.parr@tsleducation.com