He said the institute or academy could be created in north Liverpool, or at the Innovation Park, off Edge Lane, where there is already high-bandwidth infrastructure.

“I don’t think we would get much change from £5m to get this up and running. We would also need to make sure it is sustainable.

“What form it will take at the moment, I don’t know. We still need to beef up the plans.”

He said the intention is that the institute would have close links with the city’s universities and lobby the government for funding.

“We are calling on the Government to indicate their support for this industry in the North West by investing in it with money,” said Cllr Sidorczuk.

Steve Smith, of industry director ICT for Liverpool Vision, who acts as a spokesman for the industry in the region, is supporting the proposal.

He said: “The Liverpool city region is the most significant games cluster in the UK, both in numbers of people employed and revenue.

He said the principle behind clustering was that big companies would create spin-off smaller firms in a virtuous circle.

“It is incredibly important to the economy, and anything that reinforces that would be a good thing. We have to work hard to make sure we keep what we have got and a future upon which they can build.”