It would be worth a minimum of pound;150 to every student through benefits, including subsidised travel. Those with parents on income support would be entitled to additional grants of pound;300 through means-tested top-up grants under the package, which would restore spending on student support to 1991 levels.

In a separate set of recommendations, the group will press for a switch of pound;600m from child benefit to student support bringing the total package to pound;1bn. Graham Lane, chairman of the advisory group, has been asked by the members to write to Chancellor Gordon Brown spelling out the benefits.

Abolition of child benefits for 16 to 19-year-olds was Labour policy when the party was in opposition. But in power, it did a U-turn and said such benefits would remain.

“Ministers will be very sensitive about doing this, but it is the key to transforming student support for everyone, regardless of age.

“We have been skewing grants to 16 to 19-year-olds and not doing enough for the over-19s,” Mr Lane, the education chairman of the Local Government Association, told The TES.

“No one doubts that this money is going to all the wrong people. Why should the well-off parents of children at Eton and Harrow qualify for child support when people genuinely in need cannot afford to stay on?” In extensive consultations with students, the committee found the most pressing issues were travel costs for 16 to 19-year-olds and childcare and remission of fees for students over 19.

The pound;400m would be made up by pound;200m from local education authorities and matched funding from central Government.

“If we got the extra pound;600 million we could really tackle Helena Kennedy’s agenda to increase student numbers,” he said.

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