Pre-Budget statement: Colleges get new centres for research

NEW ENTERPRISE institutes are to be set up in eight universities backed by pounds 25m of government money.

The aim is to bring the concepts of innovation and enterprise into undergraduate and postgraduate courses in science and engineering.

Mr Brown also announced that businesses would get tax breaks when they second senior staff to schools or colleges. Both schemes are designed to bring education and industry closer together.

The Chancellor said the enterprise institutes were "a further signal of our determination that the genius of British invention will once again become an engine for British growth and jobs".

Ministers want the institutes to teach science students entrepreneurial skills. They also want them to act as centres of excellence for the commercial exploitation of academic discoveries and knowledge.

The promise of tax relief for businesses who send staff into classrooms as mentors aims to raise young people's aspirations.

Mr Brown said: "To meet the productivity challenge for our economy we must do more to encourage ambition in all our children, not least by bringing the world of education and industry into closer contact."

Earlier, David Blunkett, the Secretary of State for Education, said that university students in arts and humanities should do work experience to make them more enterprising and employable.

Mr Blunkett said that the Government would set up a fund to ensure that graduates were better prepared for the world of work. Work experience is common in schools but comparatively rare in universities.

The Government's plans will be modelled on existing schemes here and abroad. In Canada, Waterloo University includes a work placement and a module on the application of academic knowledge in its degree programmes. Students also work on special projects for two or three months with local businesses.

Here, Chester College requires all its students to do work experience. Around 500 spend four weeks on placement with local businesses.

Mr Blunkett said: "I am keen to provide more practical work experience and a focus on enterprise for undergraduates.

"In addition to careers guidance, we will discuss with universities the development of vocationally orientated modules in non-vocational disciplines."

Mr Blunkett also announced an extra pounds 250m to provide maintenance allowances of up to pounds 40-a-week for teenage drop-outs if they agree to work for further qualifications.

There are 75,000 children aged 16 or 17 who have dropped out of any form of education, training or work and a further 85,000 in menial jobs.

The money will pay for pilot projects to persuade young people to attend further education colleges or take up new national traineeships.

A spokeswoman for the Association of Colleges said that they were alarmed at the delay in making the allowances universal and in giving all young people the chance of a grant for a college course.

"The Prime Minister has said that he wants 500,000 extra young people mainly in further education. Many of these are hard to reach and have no background in studying. They need to be offered some kind of incentive."