Or rather, Stephen Dorrell, shadow education secretary, said the Labour party was “plus royaliste que le roi”. He said the Conservative government had pursued a policy of downgrading the value of the means-tested maintenance grant and had expected Lord Dearing, in his review, to complete the process.

However, Lord Dearing opposed the end of the maintenance grant - leaving the Government to pursue a policy more extreme than the Tories and to rip up the recommendation of an independent review.

Mr Dorrell said the shift to loans would place a greater burden on students from low-income backgrounds.

During the committee stage of the Teaching and Higher Education Bill, Kim Howells, the minister for lifelong learning, was forced to admit that students signing up for loans this September will have to do so without knowing all the details of the agreement. The final regulations may not be ready until April 2000.

Don Foster, Liberal Democrat education spokesman, said: “Students must be given the precise details of how the loans scheme will work in practice because they will, presumably, be required to sign a legal document.”

Dr Howells said students knew the new terms, namely graduates on incomes of more than pound;10,000 will repay 9 per cent of their marginal income above that amount. He also assured the committee that disability and other benefits would not be taken into account when calculating the means-tested tuition fees and loans.

The Government reversed two defeats in the Lords - one which allowed students to receive maintenance support through grants and loans on a 50:50 basis and another allowing all students in the UK who attend universities north of the border to have the tuition fee for the fourth year of a Scottish degree waived.

The Bill now means that while Scots and students from European Union will not pay the fourth-year fee, students from England, Wales and Northern Ireland will.