A new report, "Opportunity for whom?" from the left-of-centre Institute for Public Policy Research claims that middle-class students benefit disproportionately from the current funding system, while fewer working-class students proceed to HE because most fail to get high enough grades while they are in the learning and skills sector. The report advises the redirection of public money towards the latter.

"Current funding arrangements are regressive and undermine the Government’s overriding objectives of promoting social inclusion, equality of opportunity and economic prosperity, " said Wendy Piatt, one of the authors of the report. "These objectives are best met by focussing on establishing a robust foundation learning system."

Piatt recommends the abolition of state subsidy for HE fees, child benefit for the over-16s and reduced interest rates on student loans. Instead, she backs support for disadvantaged students through a Higher Education Maintenance Allowance and extending Education Maintenance Allowance for LSS students. "This is a far greater priority than the Government’s pledge to expand higher education by 50 per cent which was not based on clear labour market rationale or a firm knowledge of the current enrolment rate".

The Institute for Public Policy Research has a track record of strongly influencing the Labour government's policy-making.