An extra 20,000 university places will be made available for this autumn in a bid to cope with a surge in demand, the Chancellor announced today.
The places, which will be mainly for students studying science, technology, engineering and maths subjects, will be paid for out of a one-off £270 million University Modernisation Fund.
It comes following fears that hundreds of thousands of would-be students could miss out on places this autumn, as universities face a record rise in applications.
The Government had imposed a cap on extra places for UK and EU students studying at English universities, and last month funding chiefs confirmed that there would be 6,000 fewer places available this year than last year.
In his Budget speech today, Alistair Darling said the extra places would "allow us to strengthen our offer to our young people and ease parents' concern that their child's first taste of life after school or college will be a prolonged spell in the dole queue.
"We have seen in past recessions what a waste of potential this was and the long-term damage it caused."
He insisted that universities must make "efficiency savings" and focus their funds on "quality teaching and research."
The Chancellor said: "We are determined to achieve this without damaging key skills and our economic strengths.
"To help them do this, we are going to provide extra one-off funding of £270m in 2010-11, through a University Modernisation Fund.
"This will enable them to create 20,000 more university places, largely in key subjects like science, technology, engineering and maths, starting in September this year."
According to Ucas figures published last month, some 570,556 people applied for university by January 22, the first cut-off point for applications, up from 464,167 at the same point last year.
The 20,000 extra places will include 10,000 full-time honours degree places, 5,000 part-time honours degree places, and 5,000 foundation degree places, at a cost of £250 million over three years.
A further £20 million will be used by the funding council to look at improving efficiency in the higher education sector.
Sally Hunt, general secretary of the University and College Union (UCU) said: "Extra places for students should be a cause for celebration, but with jobs at risk in both universities and colleges we will inevitably see larger class sizes and increased workloads for staff who survive the cull. Anyone who doesn't think this will lead to a drop in the quality of education is sadly misguided.
"Other leading economies, such as France, Germany and America, are investing money in education, yet overall our government seems intent on doing the opposite."
Wes Streeting, president of the National Union of Students (NUS) said: "With record demand for places at a time of looming cuts, we welcome this urgent announcement to fund additional student places.
"The creation of additional student numbers for science, technology and maths will help to ensure that many students with the ability and aspiration to benefit from higher education will not be left out in the cold this autumn.
"It is vital however that these additional student places are fully funded and that those who are offered them receive full loan and grant entitlements. We await the full costings of these proposals and will scrutinise them carefully to ensure promises are kept and that the money is provided to deliver additional places."
Business Secretary Lord Mandelson said: "This further investment will allow universities and colleges to build on their success and continue to expand, offering 20,000 funded places this autumn through a range of degrees students want in the subjects which business and employers most need."
Universities will now be invited to bid for a share of the funding for extra places.Reuse content