In what is perhaps the most radical new idea in the Tories' draft election manifesto, they say they want to "set universities free to grow and to recover their global pre-eminence".

The document, Believing in Britain, says that many UK universities are still world leaders but are struggling with "too much red tape and government control, and too little financial freedom".

The proposed solution is to endow them progressively with money from government "windfalls".

"We will look at ways of directing future government receipts from, for example, auctions of radio spectrum, and future privatisation proceeds and asset sales, towards creating endowment funds for universities," the document says.

"Using one-off gains in this way would not only free the universities from dependency, it would also be better value for the taxpayer than simply using asset sales to reduce government debt."

Phased process

It says these endowed universities would be freed from many of the existing "financial and regulatory constraints" that prevent them offering the courses and hiring the staff they need.

They would still be required however to provide "proper access funds for the most deserving students".

The party has not gone into detail on how the scheme would work, but the Shadow Education Secretary, Theresa May, said it was intended as the start of a process.

"This would be a progressive roll-out of endowments," she said on BBC Radio 4's The World at One.

"There of course would be a first tranche of universities. We don't know the pattern yet of the receipts.

"Over time we would want to be endowing the universities and I would hope that over time we would be endowing all the universities.

"What I find so frustrating in the arguments that are put against this is this idea that if everybody can't have it at once, you can't give it to some."

Under review

In response, the general secretary of the Association of University Teachers, David Triesman, said his union reckoned that more than �80bn would be needed in endowments to replace the public funding universities currently get.