The agency attributed the situation to “teething problems” with a new computer system, which was then affecting students on higher national courses in further education colleges. The SAAS has now come under fresh pressure as the new academic session in the universities gets under way.

The NUS says students who had applied for grants at the normal time in MayJune are still waiting for their cheques. Those at Bell, Motherwell, Coatbridge and Langside colleges and the Glasgow College of Building and Printing are said to be worst hit, but 11 colleges are reporting “crisis” or “major problems,” not the least of which is being unable to contact the agency by phone or fax.

Shamin Akhtar, the NUS president in Scotland, says they wrote to the SAAS about similar problems last year when “we were assured that the system would be reviewed and changes introduced to ensure a speedier service. Rather than a shortening on previously expected delays, it would appear that the problem has occurred even earlier.”

A spokesman for the agency confirmed that delays of nine to 10 weeks were being experienced between the receipt and processing of grant applications. But it maintained that those who heeded its advice and applied before the middle of May had been notified of their awards.

The spokesman added that the agency was taking all possible steps to solve the problem, including weekend working. “Priority is being given to new students attending FE colleges and higher education institutions with early starts, and to those with dependants where these can be identified.”

A clearly irritated Brian Wilson, Education Minister, was forced to apologise to the students on behalf of the Scottish Office this week.

Bell College in Hamilton, where all students are on HE courses, says 80 per cent of first year students are still awaiting their cheques. Motherwell had 350 cheques at this time last session compared with 101 received by Monday; 150 students are still without their money and only four payments arrived last week. Jim Sweeney, the college’s student services manager, described the situation as “a disaster”.

The college has prepared special standard letters to send to housing associations, banks and building societies to relieve the financial pressure on students who are either threatened with their benefits being axed (full-time students are not entitled to benefit), or need temporary support.

Mr Sweeney said the college had already exhausted its Pounds 3,000 hardship fund, paying students Pounds 50 a week which they will have to pay back. It has now been forced to dip into its access fund, for which students normally qualify only when they lose income support or housing benefit; that fund would be depleted by Pounds 4,500 by today, Mr Sweeney estimated.

Students can apply to the Student Loans Company, but it does not normally pay out until confirmation of grant is received. Colleges are now predicting that the company will be deluged with loan applications, which can take six weeks to process, as grants come through all at once.

Tom Kelly, chief officer of the Association of Scottish Colleges, said it was difficult to know from the outside whether the problems at the agency were due to incompetence or lack of resources.