Monash University chancellor Alan Finkel told the National Press Club the ''centralised'' system, in which the federal government sets course fees, was hampering Australia's research and innovation promise.

''What's happened in the last few years is they've freed up student demand so we've gone from a controlled sector … [that sets student numbers] but they've maintained central control, what I like to think of as a communist system in terms of how the universities are controlled from the federal government, which means we can't set fees,'' Dr Finkel said.

''And if you can't set fees you can't increase the fees in order to have more money to invest in higher quality.

''So we need to allow diversification across the sector in terms of quality of research, quality of education.''

Dr Finkel's comments come as Times Higher Education magazine published its inaugural ''100 under 50'' list.

The list is designed to showcase the ''best'' global universities aged 50 years or less. Australia performed strongly on the list, with 14 universities in the top 100.

Editor Phil Baty said the list was ''brilliant news''. ''Only the UK has more representatives in the top 100 list than Australia, which beats the US, France, Germany and Canada,'' he said.

Australia's entries include Macquarie University and the University of Wollongong (tied at 33), and the Queensland University of Technology (40).