Issued this week, the report said the majority of members did not believe that abolishing the graduate endowment would achieve the SNP's avowed intention of removing barriers to accessing higher education. It criticised the Government for failing to come up with alternative approaches to widening access.
The Government could have used the legislative opportunity to introduce a more wide-ranging bill to address the wider issue of student debt and financing of higher education and student support, the MSPs argued. They noted that part-time HE students would not benefit: "This will create a situation in which part-time students will continue to pay tuition fees, while full-time students will effectively receive their education free of charge."
The committee's stage 1 report, scrutinising the Graduate Endowment Abolition (Scotland) Bill, argued there were a variety of factors underlying the low numbers of people from deprived areas going into higher education. There had been no significant increase in HE participation since the inception of the graduate endowment.
SNP committee members Aileen Campbell, Rob Gibson and Christina McKelvie, and Liberal Democrat MSP Jeremy Purvis dissented from the majority view. Their opposition does not deal it a fatal blow. If either the Conservative or Liberal Democrat MSPs support the bill in the chamber, it is still likely to pass.
A Scottish Government spokeswoman said: "We are disappointed that the committee has not endorsed this bill and the principle of free education. We are committed to removing this unfair charge with parliamentary approval."
James Alexander, NUS Scotland president, said students wanted to see the graduate endowment scrapped, but they also wanted to see more money put into bursaries.
During the election campaign, the SNP promised that hundreds of millions of pounds would be used to remove student debt, but that had not happened, he said.