First universities win approval for strategic merger

The first university merger since the Government announced a "free for all" on attracting students to higher education was unveiled yesterday. Ministers said the decision by the University of North London and London Guildhall Universities could be a blueprint for a spate of mergers.

It comes less than two weeks after Margaret Hodge, the Higher Education minister, said the time was ripe for lifting the cap on student numbers – enabling top-performing universities to expand and weaker or smaller ones to merge. A senior government source said universities could be allowed "to die" if they failed to form partnerships.

The boards of governors at North London and London Guildhall have approved the merger – creating London's biggest university with a total of nearly 25,000 students.

In a joint statement, Brian Roper, vice-chancellor of the University of London, and Roderick Floud, provost of London Guildhall University, said the merger would help fund expansion. The two universities have a combined income of £110 million.

"We believe that working together we can take a national lead in turning the Government's widening participation agenda into reality," they said. Both have been planning the merger since early May.

Sir Howard Newby, the chief executive of the Higher Education Funding Council (HEFC), said: "The decision to merge is a bold one which we believe will have significant benefits for students and the region generally." He promised that the proposal would have the body's "support in principle for this innovative strategic merger".

Mrs Hodge told the Commons select committee on education yesterday that the Government wanted to see a greater diversity of university institutions "with some focusing on research, some focusing on global, national and regional development, some focusing on widening participation". In her letter to the HEFC Mrs Hodge said she wanted to see institutions forming "strategic partnerships".

Merger talks are also on the agenda between the University of Bradford and the Bradford College of further education which would turn it into the first union of a pre-1992 university and a college of further education, where 20,000 students would be taught.

However, a proposed merger between Bath University and the University of the West of England in Bristol has floundered, as has a similar plan for Birmingham and Aston universities to merge. Bath's academics were said to be worried they could lose the university's unique identity in a tie-in with the West of England, while Aston's academics were similarly fearful of anonymity as a single body.

The name of the new London university is still under consideration. The merger will take effect from August 2002.

London Guildhall currently has 11,400 students and sites in the City of London, Tower Hamlets and Hackney. The University of North London, with sites in Holloway and Highbury, has 13,400.