Funding chiefs want at least half of England's universities to make industry workforce-training requirements a core strategic priority.

At a board meeting in February, the Higher Education Funding Council for England agreed to "encourage transformational change" in the sector, so that meeting employers' needs for skilled workers became "a core institutional strategic objective (that) impacts on at least half of English ... institutions by 2011".

Hefce's strategic plan already demands that 80 per cent of universities report "high levels of employer involvement in the higher education curriculum" this year.

It also agreed a target for "5,000, 10,000 and 20,000" employees to join higher education courses co-funded by their employers this year, next year and in 2011 respectively.

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In 2007-08, 3,840 students joined co-funded university courses. Hefce contributed ?2.6 million and employers about ?950,000.

A Hefce spokesman said: "The sector is aiming to achieve an average of 30 per cent co-funding in 2008-09 across all projects, rising to 50 per cent by the end of 2010-11."

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The board papers state that threats to the strategy include the failure to secure sufficient funding from industry.

- The Government has rejected MPs' calls to scrap its target to ensure that 40 per cent of the working-age population obtains higher education-level qualifications by 2020.

In January, the Innovation, Universities, Science and Skills Select Committee argued that Whitehall should focus on reskilling unemployed workers during the recession, not "upskilling" them.

The Government admitted that the downturn meant its policy would have to be adjusted, but said: "We disagree with the suggestion that we should resile from the ambition of a world-class skills base. The system has to be able to manage both reskilling and upskilling."

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melanie.newman@tsleducation.com