Labour's attempts to cut the numbers of students dropping out of university have cost nearly £1 billion and had virtually no effect, a committee of MPs is expected to warn this week.

More than a fifth of students drop out before graduating, a figure that has improved by less than one percentage point since 2000. The drop-out rate is worse in former polytechnics.

Even more students are giving up on part-time degree courses, which are to be expanded sharply by Gordon Brown and John Denham, the universities secretary. More than 44% of students fail to complete such courses.

MPs on the public accounts committee would not comment on their report in advance of publication, but one Westminster source said: “It is depressing. This shows universities are simply flatlining. Too many students are not getting the higher education they were promised.”

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The MPs will blame the increasingly impersonal nature of universities that has accompanied Labour’s mass expansion of higher education for failing to keep students committed.

Many senior academics now take little interest in teaching undergraduates, as most of their department’s government grant is based on their output of research papers. Some students complain of going through their entire degree with no academic knowing who they are. A large proportion of students who give up on their studies calculate that the value they gain from their degree does not justify the debts they incur.

Spending on “retention” schemes, such as mentors to support students who are considering leaving, may even make the situation worse – the £800m spent over the past five years has mainly been taken from teaching budgets.

The worst performers include Bedfordshire University and Anglia Ruskin University, based in Cambridge.

The Department for Innovation, Universities and Skills declined to comment in advance of the report.

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