Universities would be forced to merge under radical plans to restructure higher education in Wales.

Speaking to the Welsh Assembly government yesterday, Leighton Andrews, the education minister, set out plans to reduce the number of universities operating in the country.

He said Wales had been “dogged for years by many institutions which are too small to cut a mark internationally”.

Under his plans, 75 per cent of universities will have an annual income that is “above the UK median” by 2013. None will remain in the “lower quartile”.

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“This target does not mean fewer students. But it is likely to mean fewer vice-chancellors,” Mr Andrews said. “We will have significantly fewer higher education institutions in Wales, but they will be larger and stronger.”

The minister told ̽����Ƶ that if universities do not respond to his proposals, “they won’t exist”. He said that change would come “rapidly”.

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To confirm the shift in focus, the Higher Education Funding Council for Wales yesterday published a strategy supporting the plans.

Mr Andrews said universities would have to ensure that both research income and the number of international students in Wales matched or exceeded that of the rest of the UK.

He added that the government had asked HEFCW to devise a new method of funding research from 2011-12 that would better equip Welsh universities to compete for research funds.

Under the new strategy, more university education will take place on a part-time or flexible basis, with work-based options and modular routes becoming more popular. The minister also committed to expanding the provision of foundation degrees. The first changes to HEFCW’s funding methods will be felt in 2011.

Mr Andrews told THE that he would not rule out mergers between universities and further education colleges, as well as between universities themselves.

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“It is a radical statement – there isn’t any question about that,” he said.

“Clearly we have some higher education institutions that are performing very well indeed. They should have no fears, and we want institutions to play to their strengths.”

But many Welsh universities “lack critical mass”, he said. “I think institutional pride has held back some of the developments that have taken place.”

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“I think we all know that what ultimately makes universities change is the funding regime, so that’s what we’re doing. And if they don’t respond, they won’t exist.”

Richard Davies, vice-chancellor of Swansea University, said that the strategy would simply speed up the pace of change at the university.

“We’re the second-largest institution in Wales, but we’re too small,” he said. “Merger is a no-brainer if as a result you get better delivery for students.”

But he acknowledged that Mr Andrews’ plans would upset some.

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“The merger agenda has always been a controversial issue in Wales. Universities do take great pride in their independence, and discussion of merger does create anxiety at times.”

hannah.fearn@tsleducation.com