The Department for Innovation, Universities and Skills has been merged with the Department for Business, Enterprise and Regulatory Reform.

Together they will form a new Department for Business, Innovation and Skills, whose key role will be to build Britain¡¯s capabilities to compete in the global economy. The new department will be headed by Business Secretary Lord Mandelson.

In a statement, Downing Street said the move would put further education and universities ¡°closer to the heart of government thinking about building now for the upturn¡±.

Downing Street said the department would ¡°invest in the development of a higher education system committed to widening participation, equipping people with the skills and knowledge to compete in a global economy and securing and enhancing Britain¡¯s existing world-class research base¡± and ¡°continue to invest in the UK¡¯s world-class science base and develop strategies for commercialising more of that science¡±.

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The statement added: ¡°The merger of BERR and DIUS brings together the parts of the government with key expertise in these areas. It combines BERR¡¯s strengths in shaping the enterprise environment, analysing the strengths and needs of the various parts of British industry, building strategies for industrial strength and expertise in better regulation with DIUS¡¯s expertise in maintaining world class universities, expanding access to higher education, investing in the UK¡¯s science base and shaping skills policy and innovation through bodies such as the Technology Strategy Board.¡±

The Department for Children, Schools and Families will continue in its current form, under Schools Secretary Ed Balls.

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The move makes DIUS one of the shortest-lived Whitehall ministries ever ¨C in existence for less than two years. The creation of DIUS on 28 June 2007 was welcomed by the sector for giving universities ¡°a voice at the cabinet table¡±.

In January this year, the Innovation, Universities, Science and Skills select committee accused DIUS of failing to "find its feet".

Phil Willis MP, Chairman of the Innovation, Universities, Science and Skills Committee, today issued the following statement in response to the announcement:

"Machinery of Government changes announced on 28 June 2007 created a new Department for Innovation, Universities and Skills. Today, just short of its second birthday DIUS is to become part of the Department for Business and Enterprise.

"It is fair to say that DIUS has had a rocky two years. The Cabinet Office Capability Review scored it poorly in several key areas. The impact of separating different elements of the education system has led to problems particularly in Further Education and this may have been a contributory factor in the current problems with the capital programme for Further Education Colleges.

"The real casualty of this ill-thought out re-organisation is the nation's strategic science base. The opportunity has not been taken to move the Government Office for Science to the Cabinet Office, as we have recommended in the past. Science needs a stable home at the heart of government policy. I am disappointed that while the Government pays lip service to the strategic importance of science and its central role in the country's economic recovery its place within government seems to have been treated as a bargaining chip passed around departments without due care for its importance. Any further diminution of our basic science capacity could prove disastrous for the nation.

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"Turning to my Committee, although we have had challenges to overcome in doing justice to the multiple facets of DIUS, I am proud of what we have achieved and pay tribute to the commitment of Committee members. We have recognised the disparate nature of the DIUS portfolio but making the task even more complex by combining the whole of its remit with BERR will only make scrutiny even more difficult. There is now an opportunity to at least give science and engineering its own scrutiny committee and I will be writing to the Leader of the House asking for consideration to be given to the creation of a Committee on Science and Engineering when the IUSS Committee is itself disbanded."

Les Ebdon, head of Million+, said: ¡°I¡¯m sorry that the opportunity has not been taken to reunite universities with other parts of education. The new department faces immediate challenges, in particular the tens of thousands of potential students who will be turned away because there are no places for them at university this year. If the new department is serious about skills it will find the additional places needed.¡±

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UCU general secretary, Sally Hunt, said: ¡°UCU is very concerned that his merger seems to signal that further and higher education are no longer considered important enough to have a department of their own. The fact they have been lumped in with business appears to be a clear signal of how the government views colleges and universities and their main roles in this country.

¡°Education has the power to change people¡¯s lives and if we are serious about the important role it can play in helping us out of recession then we need experts in education at the helm, not business interests. We will be seeking an urgent meeting with, and assurances from, the minister that both further and higher education have clear and defined roles in the new department.¡±

Diana Warwick, Chief Executive, Universities UK, said: ¡°We were pleased that in setting up DIUS, the Government acknowledged the important and central role of higher education to the UK¡¯s economy and society by guaranteeing a distinct voice for universities at the Cabinet table.

¡°We expect this new powerful department to build on the expertise and platform created by DIUS. We are looking forward to an early meeting with Lord Mandelson. We want to work with him to continue the momentum in developing an HE system that will equip people with the knowledge and skills to compete in a global economy and enhance Britain¡¯s existing world-class research base.¡±

Current science minister, Lord Drayson, keeps his role in the new ministry as Minister of State (Science and Innovation), Department for Business, Innovation and Skills.

Rosie Winterton is confirmed as Minister of State (Regional Economic Development and Co-ordination) in the new department.

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