Under a new funding policy laid out today by the Higher Education Funding Council for Wales more than half of all student places would be redistributed on the basis of tuition fee levels and other Welsh-government priorities such as research income.

The model mimics that being introduced the same year in England, where 8 per cent of places will be redistributed to institutions charging less than ?7,500.

However, in Wales it goes further with 26.5 per cent of all undergraduate places due to be reallocated to institutions with lower fees.

As things stand only Glyndwr University is planning to charge students less than ?7,500 a year, meaning that all Welsh universities except Cardiff University (which scores well against the other government priorities being used as allocation metrics) risk losing large numbers of students if they do not slash their fees in 2013-14.

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A further 26.5 per cent of student places are due to be been allocated to universities on the basis of their research and total income, number of overseas students and spin-out companies produced.

The remaining 47 per cent of student places will not be redistributed under the plans.

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Based on these weightings, Cardiff University would gain places even if it did not receive any students from the pool set aside for sub-?7,500 universities.

All other Welsh institutions except Glyndwr could lose between 10 and 58 per cent of their student numbers if they do not lower their fees below ?7,500.

They all plan to charge an average of at least ?8,500 in 2012-13.

Priority subjects ¨C science, engineering, technology, maths, computing and modern foreign languages ¨C and courses with set quotas such as medicine, dentistry and initial teacher training are exempt from redistribution.

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The policy follows calls by the funding council and the minister for education, Leighton Andrews, for mergers to create a smaller number of bigger universities in Wales.

david.matthews@tsleducation.com