It should also lead shortly to more students from deprived backgrounds entering higher education.
A report by the Public Accounts Committee said that an improvement in performance in schools and colleges was crucial to raising the overall number of people going into HE.
At present, participation stands at 41.5 per cent with a target of 50 per cent by 2010. But the MPs say there is some lack of clarity about the targets.
They say the Department for Education and Skills should set out in unambiguous terms the targets, the courses that count and the basis for measurement.
The MPs say the initiatives such as Excellence in Cities, the Connexions Service and education maintenance allowances are showing signs of improving the educational experience of young people.
But their success had to be evaluated individually every two to three years to ensure they were leading to more people staying on in post-16.
One reason students leave university without getting a degree, or fail the course, is because they are not prepared in key skills before they start. More support had to be provided.
The MPs say funding councils should bear down on the very wide variations in success rates between institutions, which range from 48 to 98 per cent.
'Improving Student Achievement and Widening Participation in Higher Education in England' is available from the Stationery Office, priced pound;13