Plans for a university campus in Sandwell have been put on ice, following “funding issues” with education partners.

Birmingham City University and Sandwell College were working with the council to set up a higher education facility.

It was hoped the campus could bring millions of pounds in funding to the borough. However, a funding crisis within the education system has seen the scheme put on the backburner. Plans for a university in Sandwell were first announced by the local authority in January last year.

In November it was announced Sandwell Council had an “agreement in principle” with Birmingham City University, which would partner the authority in its plans to bring a university to the town.

It was proposed that the council would develop the new campus opposite the site of the proposed new £77 million Sandwell College in Spon Lane West Bromwich, a project which has been left up in the air following a government funding review. Sandwell College would then offer degrees as part of the scheme through Birmingham City University.

Councillor Bill Thomas, Sandwell Council leader, said that while plans had been put on hold he was hopeful that things could be resolved.

He said: “There’s been a freeze because of funding issues. However, now it looks as if the college has resolved its funding issues and can go ahead with its plans so we can reactivate our ongoing discussions with West Midlands-based universities and particularly Birmingham City University.”

Sandwell College is still waiting to hear about the success of its bid for £77m of funding from the Government for the new college.

Work had been due to start in March, but was delayed after the Learning and Skills Council reassessed all its spending commitments. A project to bring a university to Dudley was thrown into doubt last month after a council chief poured cold water on the scheme.

Dudley and Sandwell are among 27 areas which have expressed an interest in funds to create new higher education centres, with £150m of funding available.