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In setting the scene for his analysis (“Beware! Hazards ahead”, 18 April), Sir Steve Smith refers to universities as “anchor institutions in local economies” and to “the old adage that there is only one thing better in your city than having a university, and that is having two”. But he does not follow through on the political consequences of this statement, for example the possibility of vulnerable institutions and vulnerable places coinciding.

Smith refers to the fact that universities fall within the budget of the hard-pressed Department for Business, Innovation and Skills, but does not make a link to the review to be led by Sir Andrew Witty, chancellor of the University of Nottingham and GlaxoSmithKline’s chief executive officer, into how to forge stronger links between universities and local economies (“Build local networks to capture EU cash”, News, 28 March).

My impression is that Vince Cable, the business secretary, and the Treasury are looking to universities to play a leading role in rebalancing the UK economy sectorally and geographically, building on the government’s response to Lord Heseltine’s review (which establishes a single pot of funding for local economic development, matching the large slice of the £3.75 billion allocated by the European Union to bolster sub-national innovation in the UK).

Could it be that universities, the parts of BIS concerned with innovation and the European Regional Development Fund are talking to each other in the light of the forthcoming spending round and considering targeted funding to universities and places? If this is the case, what does it imply for a higher education policy that hitherto has been indifferent to the geography of winners and losers?

John Goddard
Emeritus professor of regional development
Newcastle University