Teachers were blamed today by a government minister for holding back children, leaving them with "depressingly low expectations" of what they could expect to achieve in life.

Liberal Democrat Education Minister David Laws said too many children were led to believe that top exam grades, places at elite universities and professional careers were beyond them.

Instead of being encouraged to "reach for the stars", he said that even in relatively affluent areas, many young people saw a job with one of the big local employers in their town as the limit of their ambition.

"Teachers, colleges, careers advisers have a role and a responsibility to aim for the stars and to encourage people to believe they can reach the top in education and employment," Mr Laws told The Daily Telegraph.

"That's not happening as much as it should do at the moment."

The comments by Mr Laws, a close ally of Deputy Prime Minister Nick Clegg who returned to the Government in last month's reshuffle, are likely to infuriate further teaching unions already at loggerheads with ministers over the coalition's education reforms.

The minister, a former City banker with a Somerset constituency, said that outside London, many young people believed that high-flying careers in the law, journalism or banking, were effectively closed to them.

"Even in my own constituency, Yeovil, which would not be regarded as one of the deprivation blackspots of the country, most young people would regard going into investment banking as almost leaving the country, because it's a different world," he said.

"They will often be encouraged to think it is beyond them."

Instead of aiming high, he said there were "too many young people who think that the two or three big employers in their local town are the limit of their aspiration".