Research and teaching are "essential and intertwined" characteristics of a university, a high-level Government forum concluded this week.
The Higher Education Research Forum, created last December by Lord Sainsbury, the Science Minister and Alan Johnson, the then Higher Education Minister, has thrown its weight behind the campaign to keep both research and teaching activities alive in all academic institutions.
Many in the sector hope that the group's final report will destabilise the unpopular Government plan, presented in last year's higher education White Paper, to move towards a sector where some institutions concentrate on teaching only, while others focus on research.
Kim Howells, Minister for Higher Education, has already indicated a willingness to take the group's recommendations on board.
In a letter to Sir Graeme Davies, vice-chancellor of London University and chair of the forum, Dr Howells said: "The argument you have made is convincing, and I have asked officials to further investigate the resource implications and consider, with Hefce (The Higher Education Funding Council for England), how best to take the scheme forward."
Sir Graeme's report explained that departments needed to have a "reasonable research culture" to enable them to design, lead and teach successful study programmes. But the group said this should not mean that every staff member should be entering the research assessment exercise and chasing research grants.
Paul Cottrell, assistant general secretary of the Association of University Teachers, said: "I was certainly cynical about this forum. It was getting to be a hot issue and the Government had to be seen to be consulting on it.
But the report hasn't supported the Government."
Mike Beveridge, deputy vice-chancellor of Plymouth University, said: "If you don't care about the quest for knowledge and the development of a subject area, what kind of teacher are you going to be?"
He observed: "The White Paper did cause a major intake of breath. It didn't take long for vice-chancellors outside the golden triangle to wake up to the fact that separating teaching from research would be dangerous."
But a senior source in one of the top research-intensive institutions said:
"When you look at the US there is little doubt that you can split teaching and research. I don't think it is necessary to combine the two in every institution."
The report suggested that £25 million would be enough to support research-based teaching in the sector, and a possible funding model has been discussed with Hefce.
But Liz Allen, national official for lecturers' union Natfhe and a member of the forum, warned: "It is unclear where the money will come from. There is no mention of new money."