Damien Shannon started legal proceedings against St Hugh¡¯s College, Oxford, after he was barred from taking up a place at the college because he did not have access to the minimum ?21,000 for fees and living costs demanded by its financial guarantee policy.

In a joint statement, published on 23 March, the college and Mr Shannon announced that they had resolved their dispute and that the university would now carry out a review of the policy.

¡°St Hugh¡¯s College has advocated successfully for the University of Oxford, supported by the Conference of Colleges of the University, to carry out a review of the present Financial Guarantee Policy.

¡°On completion of the review, recommendations will be put to the University¡¯s Council and the Conference of Colleges for consideration. It is anticipated that the process will be completed by September 2013,¡± it reads.

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St Hugh¡¯s and the University of Oxford history faculty have also offered Mr Shannon a place on the university¡¯s one-year MSc in Economic and Social History, the course for which he originally applied, it adds.

Both parties have agreed to pay their own costs, with no money changing hands.

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In bringing the case, Mr Shannon, an Open University graduate, argued that he had enough money to cover the course fees, but not the living costs demanded by college authorities.

He said that he could live on less than the ?12,900 that the guarantee required and that the policy meant those without access to capital were disproportionately discriminated against.

The outcome of the institution-wide review?will affect entrants from autumn 2014.?However on its website St Hugh¡¯s College already?states?that for autumn 2013 entrants, the figure required?to cover living costs?can be adjusted if applicants can show that their actual?level of rent?will be?less than the notional figure used in calculations.

Hazel Blears, the Labour MP for Salford and Eccles, who took up her constituent¡¯s case with the university and instigated a debate in the House of Commons on the dispute, said she was delighted with the decision.

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¡°Damien has worked incredibly hard in pushing for this, because like me, he believes that insisting students must prove they have ?13,000 towards living costs is deeply unfair, especially for those from poorer backgrounds.

¡°It means that hugely intelligent men and women who have been offered places on academic merit are being denied the chance to make the most of their potential,¡± she added.

Ms Blears added that although Oxford said it had raised ?30 million to help postgraduate students, the lack of means-tested grants to help poorer students was something that needed to change.

She would continue to push for a ¡°proper national system of support and loans¡± for postgraduate students, she added.

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elizabeth.gibney@tsleducation.com