David Cameron wants to break open the closed shop in higher education by making it easier for new providers to become universities, in an attempt to widen choice and improve social mobility.

The prime minister plans to remove barriers to new entrants, a cause once championed by Margaret Thatcher with the creation of the private University of Buckingham, which achieved university status in 1983. While hundreds of colleges have since opened — and closed — providing niche or vocational qualifications, it has been difficult for new entrants to challenge incumbents.

Mr Cameron is understood to have ordered a bill in the Queen’s Speech, expected before the summer recess, to broaden access and create more competition. Sajid Javid, the Thatcherite business secretary whose brief covers universities, told Tory MPs this week that the bill would open the way for a new generation of higher education providers.

Buckingham remains a rare example of a serious challenger in the sector. The New College of the Humanities, founded by philosopher AC Grayling, has yet to be given university status and has its degrees validated by an another institution.

Mr Cameron wants the Queen’s Speech to be a rallying point for a party deeply divided by the June referendum on EU membership; a return to Thatcherite university reforms is regarded as a good starting point.

“The idea of more competition and more private sector involvement in the university sector is something we can all agree on,” said one Tory MP.

The proposed bill is part of a “life chances and opportunities” theme for the Queen’s Speech, which is intended to flesh out Mr Cameron’s second term agenda of improving social mobility.

A green paper Jo Johnson, universities minister, last November proposed a clearer and faster trajectory for providers to award their own degrees and to secure the university title. Existing rules force new institutions to be operating for at least eight years before they can apply to become a university. That is often too long for investors to back a project.

Some have said Mr Johnson’s plans have so far been too timid and will make little difference to those seeking to break into the sector and that he will have to go further in any proposed legislation if he is to genuinely open the sector to newcomers.

Still, Tory MPs will be keen to guard jealously the international reputation of the sector. The green paper acknowledged that it would be “necessary to have appropriate controls” to make sure the quality of the education is not compromised.

The government has also recently consulted on ranking universities according to the quality of their teaching, merging a number of bodies into a single Office for Students.

Mr Johnson also wants to tackle a lack of transparency in universities’ admissions process to improve social mobility.