Colleges are braced for a fall in enrolments as students face months of uncertainty over whether they will be eligible for the Government’s new bursaries.

The Department for Education this week opened a two-month consultation on how to implement its plans to replace the education maintenance allowance (EMA) with a bursary system that will have just a third of the funding.

Julian Gravatt, assistant chief executive of the Association of Colleges, said members were trying to attract students without knowing how much support would be available until June at the earliest.

He said: “Colleges have been running open days and having prospectuses printed since last autumn. I think it will undoubtedly have an effect on enrolment for September.”

The rapid timetable contrasts with the reform of university student support, which has been given a lead time of over two years.

As education secretary Michael Gove announced on Monday, the new bursaries will be worth a total of pound;180 million, with an additional pound;194 million to continue payments for students who began courses before the EMA was scrapped.

The poorest 12,000 students, defined as those in care or who receive income support because they are parents or live alone, will receive pound;1,200 a year, roughly equivalent to the maximum EMA payment.

The remaining pound;165 million will be enough to pay an average of pound;800 a year to students whose family income is below the pound;16,000 threshold for free school meals, the DfE said - pound;350 less than they would have received from the EMA. Colleges, schools and training providers will be able to allocate the money as they choose, however.

Mr Gravatt said many colleges may wish to use part of the funding to pay for a travel subsidy rather than giving it to individual students, although it was not yet clear if that was permitted.

In its consultation document, the DfE said it was most likely to allocate funds according to past EMA claims, although it acknowledged that might have to change in future. It also said it could use free school meal eligibility or the index of deprivation for the institution’s area.

The Institute for Fiscal Studies, which evaluated the EMA scheme and found it had boosted participation by about 6 per cent, said letting providers decide how the money was spent “could reduce transparency and certainty for students”.

It also said that colleges and schools could use the money as an incentive to attract the best students. “For example, it could be given to high- achieving, low-income students - perhaps the type of students who would have stayed in full-time education anyway,” it said.

The DfE said it would closely monitor the use of the fund in its first year, although the extent of its supervision is not yet clear.