Steve Smith told a fringe event at the Labour Party conference in Manchester that his analysis was based on cuts being discussed in Whitehall.

He referred to newspaper reports in the past 10 days that have suggested that the coalition intends to cut the teaching budget by as much as ?3.5 billion in a bid to shelter research.

The rationale for this, it has been suggested, is that universities can recoup the teaching funds by charging more for degrees after Lord Browne of Madingley¡¯s review of student fees and funding reports next month.

Professor Smith, vice-chancellor of the University of Exeter, told a fringe meeting hosted by UUK and the Social Market Foundation that fears of a huge funding gap could now be realised.

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He said fees of just over ?7,000 a year would be needed to ¡°compensate for the predicted loss of government funding, and that is based on negotiations that are going on¡±.

His comments came before Ed Miliband was due to use his first speech as Labour leader to denounce his party¡¯s previous policy on tuition fees.

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Addressing the country at large, Mr Miliband, who favours a graduate tax, was expected to tell conference delegates this afternoon: ¡°When you wanted to make it possible for your kids to get on in life, I understand why you felt that we were stuck in old thinking about higher and higher levels of personal debt, including tuition fees.¡±

simon.baker@tsleducation.com