Middle classes soothed over college fees

The Government moved yesterday to reassure middle-class parents they would not pay more towards their children's higher education under plans to bring in means-tested tuition fees and abolish what remains of student grants in favour of loans.

Graduates on lower incomes would also get a better deal than at present, government sources insisted, despite the fact that they would have to repay all rather than only part of their living costs to the state.

On Wednesday, David Blunkett, Secretary of State for Education, will announce proposals to charge students up to pounds 1,000 a year for university tuition, repayable after graduation. The precise sum would depend on their parents' income, but those whose families earned pounds 34,000 per year or more would repay the full amount, while those from poor backgrounds - with a family wage below pounds 16,000 - would be exempt from repayments.

The move would be expected to alarm better-off parents, who already have to contribute up to pounds 2,160 a year towards maintenance costs for children at university. However, government sources yesterday said that students from wealthier families would have access to a full pounds 1,000 a year loan to offset the cost of tuition fees, although their parents would still have to pay towards living costs.

"What we are looking for is no increase in the overall parental contribution," the sources said.

Government plans for a means-tested tuition fee and the abolition of maintenance grants even for students from poor families run contrary to the preferred option spelt out by Sir Ron Dearing's committee of inquiry into higher education, due to report on Wednesday.

The committee proposes charging a flat rate of pounds 1,000 per year for tuition, repayable after graduation by all students, but recommends continuing the government contribution towards living costs to protect students from poorer backgrounds.

Under the Government's plans, students from the wealthiest families will finish university facing loan repayments of pounds 3,000 for tuition, plus any money they have borrowed to top up their parents' contributions towards maintenance.

Those from the poorest backgrounds will have no bills for tuition, but will have to repay at least pounds 7,500 in maintenance loans.

However, government sources suggested the terms of the state-subsidised, income contingent loans would be such that a graduate earning under pounds 19,000 would get a better repayments deal than those paying back existing, much smaller maintenance loans.

Universities yesterday welcomed the Government's response to the Dearing recom- mendations. Diana Warwick, chief executive of the Committee of Vice-Chancellors and Principals, said: "It looks both as if the Government recognises the problem and as if money will start flowing quite quickly."

However, the National Union of Students reiterated its opposition to any form of tuition fees, claiming their introduction would leave the door open for heftier fees later.