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Wrestling with Cubie to find a way to survive;News

THE FOCUS shifted this week from the Cubie committee to the Scottish Executive's response, which holds the key to the survival of the coalition government between Labour and the Liberal Democrats.

The Cubie report on student finance, which was published after we went to press, has tried to square the circle between the Liberal Democrats' determination to abolish student contributions to tuition fees and Labour's insistence on retaining them.

Problems of definition will no doubt be uppermost in minister's minds as they wrestle with Cubie's solutions - requiring students to continue making a contribution to their tuition but after they start earning not before they start studying on the principle that "the beneficiary pays", and introducing a more coherent system of "hardship bursaries" to support poorer students and widen access.

This meets the test applied by Henry McLeish, the enterprise and lifelong learning minister, that means-tested tuition fees are not the issue for most students since 40 per cent are exempt and that any alternative package must not put access at risk.

Mr McLeish has also been at pains, however, to stress that any new scheme must be fully costed and not be at the cost of higher education funding in general. The Cubie plans suggest that deferring payment of tuition fees could cost pound;48 million a year, although this shortfall would drop to a net loss of pound;12m if students' loan entitlement is reduced. But neither the Treasury nor Mr McLeish's colleagues in the Scottish Executive will be falling over themselves by offering to plug this immediate gap.

The Treasury may not be the only source of Whitehall opposition, which complicates the Scottish deliberations. The Department for Education and Employment has already made clear its opposition to two separate systems of students finance in the UK, and there will also be implications for the Department of Health and Social Security because of the links between benefits, bursaries and income.

These will be among the issues which Mr McLeish and Nicol Stephen, his Liberal deputy, will have to thrash out in a small group of ministers now charged with finding an Executive compromise to Cubie's compromise.

Other members will include Donald Dewar, the First Minister, Jim Wallace, the deputy first minister and - crucially - Jack McConnell, the finance minister.

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