Ministers have been considering a bid for an increase in higher education spending of at least Pounds 630 million over the next two years.
The Department for Education and Employment, which is expected to unveil its spending plans for the sector on Tuesday as part of the government's comprehensive spending review, has been urged by vice-chancellors to make the extra investment to protect teaching quality in higher education.
The Committee of Vice-Chancellors and Principals is calling for an extra Pounds 240 million next year, which is year one of the CSR, and a further Pounds 390 million the following year.
It also wants the government to commit itself to spending on continued growth in year three, but is waiting to see the details of Tuesday's announcement before calculating the cost.
Most of the key points in the CVCP's submission to the CSR are based on Lord Dearing's assessment of the sector's needs, published in his higher education inquiry report last year.
Extra cash already promised for research should be balanced by investment in higher education's teaching infrastructure, which is showing signs of strain, vice-chancellors told ministers.
An extra Pounds 100 million is needed to update and replace information technology equipment next year, followed by another Pounds 100 million in the following year.
But the biggest rise in spending should be targeted at improving and replacing teaching equipment, at an estimated cost of Pounds 150 million in 2000-01 and Pounds 250 million in 2001-02.
The cost of holding real efficiency gains down over the next two years to 1 per cent, as recommended by Dearing, comes to Pounds 90 million next year with another Pounds 75 million in the following year, according to DFEE and CVCP estimates.
And funding the extra 35,000 student numbers expected for higher education could add another Pounds 50 million to the bill next year and Pounds 65 million in 2000-01.
In addition, the CVCP is pressing the government to make significant improvements in financial support available to part-time students. While fee waivers for unemployed part-timers were a step in the right direction, vice-chancellors believe, widening access and participation will only truly be achieved by extending loans to part-time students.
The CVCP argues that this would be easier to achieve if loans were redefined so as not to count in full against the public sector borrowing requirement.