Speaking at a conference in Manchester yesterday, the business secretary added that he does not know whether the proposed cap of ?9,000 a year will be enough to ¡°head off¡± those considering opting out of state financial support.

¡°One of the reasons we are [raising the fee cap] is precisely to head off Oxford, Cambridge, the London School of Economics, University College London and a few others from going private,¡± he is reported to have said in a speech at the annual conference of the Girls¡¯ Schools Association.

¡°If we had not opened up the system, they would have a very strong incentive to do so.¡±

Mr Cable¡¯s comments contradict the public statements made by some of the country¡¯s leading universities, which have frequently dismissed claims they are considering privatisation.

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In a statement on the topic issued to Times ÖйúAƬ last month, Howard Davies, the LSE¡¯s director, says: ¡°I have so far seen no arguments which convince me that the school and its students would be better off as a result of ¡®going private¡¯.¡±

Mr Cable is also reported to have told delegates at the conference that ¡°a lot of universities are effectively broke¡± and that ¡°if they were in the private sector they would have been filing for bankruptcy¡±.

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¡°Various arrangements have been cobbled together to keep them going, and we can¡¯t continue to do that,¡± he said.

john.gill@tsleducation.com