MPs support grants for university students

Students would be paid up to £40 a week to go to university under a reform package to be published today by an influential all-party group of MPs.

Students would be paid up to £40 a week to go to university under a reform package to be published today by an influential all-party group of MPs.

They say the cost of the package – in effect a return to the days of grants for the less well-off – could be met by higher tuition fees and the end of student loans at low interest.

The proposals call for education maintenance allowances, under trial for pupils aged 16 to 19 in schools and colleges, to be extended to "at least" the first year of university. Ministers are being urged by the Commons Select Committee on Education to back the idea in their long-awaited review of university finance, now delayed until the autumn.

Gordon Brown, the Chancellor, is known to support an extension of education maintenance allowances. In his comprehensive spending review next week, he will announce the expansion of means-tested payments. Sources say he could also favour extension of payments to university students.

Estelle Morris, the Secretary of State for Education, backed the maintenance allowances. She told MPs they had been successful in increasing staying on rates in schools or colleges by about 5 per cent in the pilot areas.

In a report published today, the MPs say the Government has failed so far in its attempt to widen participation in higher education by the less well-off. "Fear of debt by working-class students is a significant reason associated with barriers to wider participation in higher education," the report says.

The MPs urge the Government not to scrap the £1,100 a year tuition fees. "As they are means-tested, they are a very progressive element in higher education and could be increased," they add. At present, 42 per cent of students are exempt on the ground of hardship. The group also wants to scrap "zero real interest rate" student loans, saying they subsidise only those from affluent backgrounds.