Universities are at the forefront of plans to boost the economies of the North of England. In the first in our series on moves towards greater collaboration within regions, Alison Utley reports on the initial steps to combine forces.

"The Northern Way" describes a government task force vision for the future regeneration of the North of England - encompassing bold plans for the development of housing, transport and the economies of major cities in the region, from Liverpool to Manchester and Leeds to Hull, and from Sheffield in the south to Tyneside in the North.

But the term is also being used by university vice-chancellors in the region to describe their own plans for collaboration.

The proposals are a key strand of the Government's bid to revive the North's economy - worth up to ?35 billion a year.

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University chiefs are discussing ways of working much more closely than previously - from deciding which degree subjects are offered in the region to coordinating major research efforts.

Drummond Bone, Liverpool University's vice-chancellor, a member of the Northern Way steering group, said that as key players in the initiative, universities could be working together on future goals as never before.

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Professor Bone said: "While I don't suppose we will be seeing Soviet-style forward planning in the region's universities, we will be sitting down together in a new way and working out how to divide up some of the roles that are duplicated."

If the plans are realised, much of the traditional competition between universities in the region would give way to collaboration on an unprecedented scale in course provision, research and marketing strategies, Professor Bone said.

The skills agenda, widening participation and universities' interactions with industry could all be tackled in a more centralised way through joint planning, which ought to result in significant efficiency gains, he predicted.

The Northern Way steering group is still at a deliberation stage, but it is expected to propose that universities in the North combine their efforts:

• To jointly monitor and resolve key gaps in degree-course provision - working, for example, with the Higher Education Funding Council for England to highlight subjects such as chemistry that may be in danger of disappearing in some areas
• To identify common barriers to progression of working-class students on to degree courses, identifying local areas where university participation is a particular problem
• To integrate student placement schemes
• To enable universities to develop common estates strategies as well as sharing sports and cultural facilities
• To pool marketing expertise to raise the profile of all campuses across the North. Urban regeneration projects could be jointly planned, as could rural regeneration through the development of, for example, satellite campuses and virtual course delivery
• To collaborate on ventures with further education providers and to promote science in support of economic development
• To enable knowledge-transfer activities to be streamlined across the North through a single northern science and industry council - expanding the existing successful science and industry council for the Northwest
• To benefit researchers with increased collaborations across the northern region, which could help to increase income from both the public and business sectors.

The group is also looking at the feasibility of a strategic task force designed to predict directions in technology and social and cultural development - and to mobilise the necessary academic expertise in each area.

This may seem like an ambitious list of goals. But the Northern Way task force has powerful backers. The initiative was kick-started by the Office of the Deputy Prime Minister this year in a report called Making it Happen - The Northern Way . It launched the Northern Way initiative, which has a steering group, that includes representatives from universities.

John Prescott, the Deputy Prime Minister, said: "Making the most of the North's potential demands a new mindset - a transregional view - so that the sum of investment and regeneration is greater than the parts."

Mr Prescott is also the key driving force for the setting up of a Northeast assembly.

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Economic productivity is lower in the North than in the South of the country, and there are fewer businesses employing fewer graduates and people on average are less well qualified.

It is estimated by the Office of the Deputy Prime Minister that if the productivity of the North were raised to that of the national average, it would generate more than ?30 billion a year for the regional and UK economy.

Ed Balls, Gordon Brown's former economic adviser, who resigned from the Treasury to stand for Parliament in the safe Labour seat of Normanton in Derbyshire, also sits on the Northern Way steering group.

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The group hopes to create more businesses, a better skilled workforce and improved transport links. The three development agencies in the Northwest, Yorkshire and the Northeast have joined in a bid to get these plans off the ground.

By 2025 the group wants to establish sustainable growth of the North's economy partly by investing in cities to make them more attractive places to live and visit but also by ensuring that universities are "world class" and working effectively with local businesses.

Northern universities, as major employers, generators of ideas and inventions and repositories of expertise, are seen as key players in the regeneration plans.

Paul Wellings, vice-chancellor of Lancaster University, said he thought the benefits of collaboration would outweigh any downsides to closer working relationships - and that the Northern Way proposals would help empower higher education institutions in setting the regional agenda.

He said: "Overall, this is a tremendously good thing for the country. We need to focus on priority setting to prevent every regional development agency recommending, for example, setting up a nanotechnology centre.

"Universities must get used to making productive suggestions rather than standing on the sidelines doing their own thing. That is the worst that could happen."

The role to be played by the region's new universities is less clear however. Graham Henderson, vice-chancellor of Teesside University, said it was important not to get left behind by powerful research-led institutions.

He said: "The universities in the Northeast are already seen by the regional development agency as having a pivotal role in the regeneration of this region.

"Indeed, universities are at the heart of the regional economy. However, we are a relatively small region and our ability to lever funding and support for our activities could undoubtedly be enhanced by working in partnership with other northern regions, not least because there are major similarities in our research and technological strengths."

Professor Henderson added that modern universities had a vital role in skills updating, knowledge transfer and widening participation, all of which needed to be fully recognised.

There is also a note of caution from someone in the region who has experienced the nurturing of local links.

The White Rose university consortium - a strategic partnership between Yorkshire's leading research universities of Leeds, Sheffield and York - is seen by many as the most successful regional university research collaboration in the UK to date.

Martin Doxey, chief executive of the consortium, said that large clusters of people and organisations working together could be effective.

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But he added: "It's good to see recognition for the idea that universities are the economic drivers of knowledge economies of the future, but I think we need to be careful about too much central planning when there are so many competing interests at stake."

THE NORTH: FACTS AND FIGURES

• While the North of England is home to 24 per cent of the UK's population, only 19 per cent of UK businesses are based there, producing 20 per cent of the UK's wealth. Fewer businesses are started by entrepreneurs in the North than anywhere in the UK. More than 14 million people live in the North and there are 700,000 businesses. Growth business areas include chemicals, advanced engineering, food and drink, energy and environmental technologies as well as financial and professional services.
• The North has a much lower proportion of people with higher-level qualifications. At GCSE and above, attainment in the North is low compared with the country as a whole. In England, some 51.6 per cent of those taking GCSEs earned grades A* to C. In the Northeast and Yorkshire and the Humber, 44 per cent got these grades and 48 per cent in the Northwest. The three northern regions have the lowest national proportion of 16 and 17-year-olds participating in learning.
• The North is a net population importer, according to the latest government figures, which show that in 2003 the North imported almost 30,000 people compared with a net loss of 70,000 in 1997.
• The Northern Way steering group stresses that accelerating the rate of growth of the North is the key to boosting the nation's economy. It points out that all of the more successful larger economies in Europe feature at least two main regions driving growth - they do not rely on one region alone. The task the group has set itself is ensuring that northern universities and colleges can provide training that meets the needs of the North's employers. Otherwise those employers will go elsewhere.
• There are five universities in the Northeast with a total annual income of almost ?590 million. These five universities attract more than 84,000 full-time and part-time students. The Northeast has the highest percentage of young full-time undergraduates remaining in the region to study, and the inflow of students is much greater than the outflow. It also has a high proportion of young full-time first-degree entrants from low-participation neighbourhoods, second only to the Northwest.
• There are 15 higher education institutions in the Northwest: eight universities and seven higher education colleges. There are 177,000 full-time-equivalent students in higher education in the region. Higher education is concentrated along the Liverpool-Manchester axis, with six universities and four higher education colleges in the area. The Northwest has the highest proportion of young full-time first-degree entrants from low-participation neighbourhoods.
• There are 11 higher education institutions in Yorkshire and the Humber - eight universities and three higher education colleges. The higher education student population is about 149,000 FTEs. Yorkshire Universities was one of the earliest higher education consortia to be established in the UK. There is a high net flow of young full-time undergraduates into the region - for every 100 students from Yorkshire and the Humber, there are 147 students studying in the region.