Performing-arts schools welcomed the pounds 19m scheme but said the scholarships would cover only 70 per cent of those in training. And a quarter of the awards are for only one or two years, even though nearly all courses are for three.
Representatives of schools that train performing-arts students are negotiating with the Government on whether the students' parents or the colleges should pay for the third year. Students had to compete at demanding auditions to win the scholarships, which are replacing the present lottery of funding for performing-arts places.
Until now, awards have been at the discretion of local authorities and their number has been dwindling.
The new scholarships, worth more than pounds 6,000 each, have been allocated to 29 private dance and drama schools including the Royal Academy of Dramatic Art, the Laban Centre, the Conti Academy of Theatre Arts and the Central School of Ballet. Courses include classical ballet, musical theatre, acting, choreography and stage management.
Adele Bailey, executive secretary of the National Council for Drama Training, said: "This is a historic breakthrough and we are delighted. But no more than 70 per cent of the cohort will benefit. The rest not only do not get a government grant, they don't get money from the hardship fund. It has created a two-tier system, which has the potential to be dangerous.
"The Government came up with a fixed amount of money and they have had to do some convoluted maths to make it work. They are funding two-year courses at places which don't necessarily have two-year courses."
Anna Leatherdale, lead officer at the National Council for Dance Education and Training, said the scheme was "an enormous advance" but the council was concerned that funding for 25 per cent of the scholarships would run out after one or two years.
A spokesman for the Department for Education said that at present there were 500 partially funded dance and drama places. These were being replaced by 820 fully funded places. "We accept that the majority of scholarships need to be for three-year courses but there needs to be provision for shorter courses."
Baroness Blackstone, minister for higher education, met some of the first successful scholars yesterday. She said: "Success in the performing arts has direct benefits - to the economy and in boosting Britain's image abroad. The awards will help our most talented young people to benefit from the highest-quality training for the stage and screen.
"The new scholarships replace a previously incoherent system where many talented youngsters lost out."