The government should create a £1bn fund to help university researchers work with small businesses to turn promising ideas into money-spinning inventions, according to GlaxoSmithKline‘s chief executive, Sir Andrew Witty.

In a report commissioned by the government and published on Tuesday, the pharmaceuticals boss, who is chancellor of Nottingham University, also calls on universities to set a specific target of promoting economic growth.

Concluding his seven-month review, Witty argues that universities are in “unnecessary” competition for funding. “It doesn’t really matter whether a town in Britain beats another town in Britain. What is important is whether a town in Britain beats another town overseas,” he says.

The current postcode-based funding should be simplified, with £1bn made available to researchers working on technologies where Britain has a promising lead, according to the Witty report, which is supported by Universities UK. It could raise hackles among some researchers who want to ensure higher education institutes continue to pursue researchthat is not tied to commercial goals.

Witty said universities had a tremendous appetite for his agenda, butresearch funding had to become simpler: “Their concern is not should they be doing this. Their concern is that it is too complicated to do this.”

He said a simplified, more collaborative approach to research would help spread growth beyond the south-east, home to the so-called ‘golden triangle’ of Oxford, Cambridge and Imperial College London, the three UK universities that feature in the top 10 of the Times Higher Education rankings.

David Willetts, the universities and science minister, said the government was working to commercialise the work done by universities for eight specific technologies, from space to regenerative medicine. “We will now consider [Witty’s] recommendations and respond more fully in time.”