Top independent schools have been urged to consider launching their own private universities.

Britain needs more privatelyfunded colleges and universities because tuition fees and core Government grants do not provide enough money, said Professor Michael Thorne, vice-chancellor of the University of East London.

Speaking to the Headmasters' and Headmistresses' Conference of elite independent schools in Manchester, Prof Thorne said: "Many of you are sitting on global education brands which could be stretched to private universities."

The university system in the US contains a far higher proportion of privately funded institutions than the UK, Prof Thorne said. The endowments which Ivy League universities such as Harvard enjoy far outstrip the state funding given to all British universities, he said.

Prof Thorne suggested that famous public schools should consider following the American example, where some of the best colleges for courses in business, for example, were run by private institutions.

Eton and Harrow are "certainly worldwide school brands", he said.

"It would be an easy stretch, wouldn't it, to go to Eton University?" he suggested.

Such a university would start as a "niche" institution for the few people who could afford it.