The Government will invest £200m in new teaching facilities for engineering and science subjects in UK universities.
The Minister of State for Universities and Science said universities would be entitled to the extra cash for teaching facilities if they could match it with private money, meaning a total of £400m in capital investment.
He also announced that the Government will extend fee loans to part time students who decide to study a second degree in engineering, technology, or computer science, overturning rules implemented by the previous Labour government preventing students from accessing funding for second degree, at least in this limited area.
Willetts told delegates it was time more women were attracted in to the sector and that universities should aim to double the proportion of engineering degrees taken by women, a goal which he hoped the two newly announced policies would help to achieve.
He said: "We are not going to win in the global race if we waste the talents of half the British people. The proportion of engineers who are women is one of the lowest in Europe and we've got to raise our game.
"That is why we support the ambition of doubling the proportion of engineering degrees taken by women. Today I can announce two initiatives to help us achieve just that.”
Nigel Fine, chief executive of the Institution of Engineering and Technology, said: “This £400m cash injection is a great start – and one that the IET has been seeking for some time. But it will take a concerted effort from the engineering industry as a whole to fix the problem and achieve a meaningful rise in the number of young people, and women in particular, who chose engineering as their career.
He added: “Our 2013 Skills Survey found that over a third of employers are not taking any action to attract women into engineering whilst the average age of the engineering workforce continues to increase, with 56 per cent over the age of 40.
“We still need to do more to attract young people in to the profession as they make a vital contribution to energy, transport, IT and so many other parts of the national infrastructure that everyone takes for granted. I hope today’s announcement will add further impetus to attract the future generation of engineers.”
Tim Thomas, head of employment policy at EEF, the manufacturers’ organisation, said: “The UK’s growing manufacturers are already finding the supply of engineers a block on expansion, with too few graduates, particularly women, entering the sector.
“A rebalanced economy will only become a reality if the supply of scientists and engineers can meet the increasing demands of employers, with universities and employers investing together to achieve this.”
Paul Nurse, president of the Royal Society, said: "Women are under-represented in some areas of science and engineering and that means that the UK is missing out on some of the best people in fields that are hugely important to our economy.
"It is excellent news that the Government is being ambitious about tackling this issue. Much good work has been done in recent years but this is not a problem that can be solved overnight. It will be difficult to achieve these ambitions but we look forward to doing what we can to help."
Professor Matthew Harrison, Director of Engineering and Education at the Royal Academy of Engineering said: “The Royal Academy of Engineering has been calling for deeper employer engagement in all phases of education in order to develop more and better engineers.
“We welcome every attempt to raise the number, quality and diversity of engineers. These announcements today are a valuable next step.”