Don economic armour or face more blood-letting, says Hefce's leader

Speaking at the Higher Education Funding Council for England's annual conference, Sir Alan Langlands said that university leaders had to be prepared to spell out why the government should maintain state support for universities ahead of the next spending review, scheduled for 2015.

Comparing universities with other parts of the public sector, Sir Alan said: "We need to be alert, year by year...to the fact that higher education looks pretty well-heeled.

"With the combination of Hefce [money] and fee funding, if you are sitting in the Treasury, [overall funding] begins to look very generous."

The former chief executive of the NHS in England said that the sector needed to debate whether "it was reasonable to have a public contribution of 30 per cent" towards support for students.

In last year's higher education White Paper, the government estimated that 30 per cent of the total value of student loans would never be repaid.

"All of us need to have a position on these things before the next spending review," Sir Alan said.

He suggested that the sector needed a "new narrative" to challenge cuts, primarily based on how universities helped to stimulate economic growth.

On wider government policy, he said: "It's all about growth and we cannot duck that.

"We need to recognise that higher education institutions are anchors [within communities] in relation to economic growth, and we should expect others to want to build their ideas for economic development around universities."

Sir Alan hinted that the terms of student loans might be under particular threat, rather than central funding distributed by Hefce.

"The pressure on the student loan book will be significant indeed. If there is a squeeze, will it be on graduate packages or on the terms of student support?" he asked.

His warning echoed comments made by Liam Burns, president of the National Union of Students, earlier in the conference, which was held in London on 18 April.

Mr Burns said that graduates may be asked to pay back more towards the cost of their loans.

"The government will miss its deficit-reduction targets and student loans will look like an easy target," he said.

"The terms of student loans are not secure at the moment. It is clear these terms can be changed."

He added: "When the next set of ministers comes along with the student loan in their [sights], what will the sector do? Will it stand up for students or let us down?"

Drawing attention to vice-chancellors' supposed anonymity during the fee changes two years ago, Mr Burns said that they must be more visible in their opposition to future government cuts.

In a wry dig at university heads, the NUS leader compared vice-chancellors in 2010 with the elusive Higgs boson, the hypothetical elementary particle: "We knew you were there in theory, but we never actually ever saw you."

jack.grove@tsleducation.com.