Graduates will have to pay more for their university education in the future, Vince Cable has revealed, under sweeping reforms being considered by the Government.

Higher graduate contributions are the "only possible way forward" to make the higher education system fairer and sustainable for the future, the Business Secretary said.

Mr Cable was setting out a more "progressive" system of funding that includes proposals for a so-called "graduate tax".

And he admitted that as the university sector becomes more competitive, it is inevitable that some institutions will struggle and should be left to fail.

In his first speech on higher education, Mr Cable told a meeting at London South Bank University: "The reality is we are going to have to develop a model in which the balance of funding for higher education in England combines less public support and more private investment from those who benefit most from it."

Students "almost certainly will have to pay more", he said.