Mr Wallace said more government money was not the solution

Lifelong Learning Minister Jim Wallace told top education chiefs to come up with their own plans for boosting their coffers.

Large injections of government money would not be a solution to the challenges the universities face, he said.

Mr Wallace was speaking in response to a call from 21 Scottish higher education institutions for an extra �100m of government funding.

'On the cheap'

Professor Bill Stevely, convener of Universities of Scotland, set out their case for the additional cash on top of planned spending increases by the executive up until 2005-06.

At a conference in Edinburgh, Professor Stevely warned the executive against trying to run universities "on the cheap".

He added: "In England the debate has moved on from a recognition that universities are under-funded - it's been accepted at the most senior level of government.

Universities were told there would be no blank cheques

"We're surprised that in Scotland there has been a strange unwillingness to accept that this is the case."

He said Scotland currently suffered from a funding gap with comparable European competitor nations of �169m, although Universities of Scotland was seeking only a further �100 million from the executive.

But Mr Wallace told the same meeting: "I'm not confident that large additional injections of government money into the system by itself will actually provide a long-term solution to the challenges we now face."

The minister said the executive would be investing more than �800m a year into HE by the end of 2005-06.

'Enormous responsibility

He added: "We need to know that the great resource we have in our higher education institutions is being used with the greatest imagination and creativity possible.

"The members of Universities of Scotland have an enormous responsibility in terms of our development as a nation."

Mr Wallace also hammered home the opposition of Scottish ministers to top-up tuition fees, as proposed in England.