Students could avoid paying tuition fees if they waive their right to grants and loans under plans which, critics say, would force them to live with their parents and study at universities near their homes.

The “no-fee degrees” being considered by ministers would allow students to save almost £10,000 but would mean forgoing government financial support of up to £25,000 over a three-year degree.

University heads and education policy experts called the plan confused. Recent studies suggest that rising numbers of students are already choosing to live at home in order to save money. A survey published today indicates that more state school pupils than ever aspire to go to university. The Sutton Trust, an education charity, found that 77 per cent now intend to do so, up from 73 per cent last year.

Tuition fees will be capped at £3,225 a year from next year but university heads are pushing to charge more. A report this year by Universities UK found that by 2016 a graduate’s average debt would be £26,400 if fees were raised to £5,000.

Under current rules students can claim a loan for tuition fees and more for living costs. There are also grants for poorer students, who can get up to £11,606 a year if they live in London. It is not clear if eligibility for the scheme, which is being proposed in a draft framework for the future of higher education, would be means-tested or whether students from wealthier families could take advantage.

David Willetts, the Shadow Skills Secretary, said that the no-fees idea was worth exploring. “Young people need much more imaginative thinking from the Government about how they can improve their chances of getting to university, as we face a crisis in university applications this summer.”

Sally Hunt, of the University and Colleges Union, said: “We want students to have access to decent local courses, but the facts are that these plans will see students with the necessary resources choosing where and what they wish to study and those from poorer backgrounds denied the opportunity to move away.”

James Turner, of the Sutton Trust , said: “Higher education should be available to all, regardless of their ability to pay and their willingness to take on debt.”

Ministers are due to begin a review of tuition fees this year. Vice-chancellors have said that there is an £8,000 deficit between what it costs to teach a student and the amount paid in fees.

Professor Paul Wellings, chair-elect of the 1994 Group of research intensive universities, said: “We will be cautious of any new proposals that result in cut-price, lower-quality degrees of a lower value to students.”

Lord Mandelson, the Skills Secretary, has asked the Treasury for emergency funding for 10,000 extra university places amid fears that 40,000 capable students will miss out on places this year because of a black hole in higher education funding. It has been reported that the cost of the scheme to the Treasury could be £90 million.

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