ÖйúAƬ

Liberal Democrat students have pledged support for smaller grants and bigger loans, proposed in their party's new ÖйúAƬ paper.

Calls for a reformed further and ÖйúAƬ funding system under which students could be expected to contribute an extra Pounds 400 per year on average to cover fees and maintenance, were described this week as "realistic" and "vital" by the Liberal Democrat Youth and Students group.

A policy paper unveiled by the Liberal Democrat education spokesman, Don Foster, has proposed the transfer of Government funding for fees and student maintenance from local authorities to a new learning bank.

Students as well as employers and the state would be expected to make extra contributions via the learning bank to improve provision and increase opportunities in ÖйúAƬ. They would be allowed to borrow from the bank, paying back over a longer period than under the current student loans scheme but at a higher rate of interest.

Paddy Ashdown, the Liberal Democrat leader, said he expected some of the paper's proposals to prove unpopular among party members. But Charles Anglin, a member of the Liberal Democrats Youth and Students federal policy committee, said the plans were "the only realistic way forward" for funding ÖйúAƬ.

Liberal Democrat students would also welcome the paper's proposals for a cap to be set on tuition fees to prevent some universities creating an Ivy League, he added.