An emergency taskforce to deal with hundreds of thousands of delayed payments to England’s poorest sixth form students is to be set up after the collapse of a new software system, The Times has learnt.

At some schools and sixth form colleges as many as three-quarters of students are still waiting for their Education Maintenance Allowance (EMA) to help them continue studying beyond GCSEs, a survey by the Association of Colleges suggests.

The EMA is a £30 weekly payment to students aged 16 to 18 from low income backgrounds to encourage them to remain in education .

Schools, sixth form and further education colleges fear that if the problem is not sorted out quickly, many students may drop out.

Representatives from the Department for Children Schools and Families, the Learning and Skills Council and the Association of Colleges met in secret today to establish ways to tackle the delays.

The computer system intended to deliver 500,000 grants to students at the beginning of term crashed over the summer and was replaced by paper forms. Liberata, the company that took on the £80million six-year contract this year has been fined £3million over the problems.

David Collins, the president of the Association of Colleges, said that in a survey of the heads of 50 colleges most reported only one quarter of pupils had received their grant and at one college only 5 per cent had got their money over a month after the start of term. The Learning and Skills Council say that 170,000 students have been paid but Barry Hansford chair of the National Association of Managers of Student Services told The Times this figure would normally be expected to be 400,000 by this time in the term.

Dr Collins said: “The colleges at the moment are drawing on their own funds but it’s not sustainable and if this goes on too long we would expect that this would be reimbursed.” He added that many colleges were experiencing difficulties with the computer system when trying to submit payment details and the helpline was constantly engaged. Many of the details on forms telling pupils to expect the money are incorrect meaning that they will have to be resubmitted, he said.

At one school in Barnsley of 2,075 pupils eligible for the grant this year only 166 have so far received it compared to 100 per cent of pupils at the same time last year.

A head of one college, who complained of painfully slow and crashing computer systems when entering payment details for students, said: “I understand the Liberata has been paid £80 million pounds for this contract, but my feeling is that only £1 has been spent on this system.”

The problems are a further embarrassment for the Government after a summer of delays to millions of national test results for 11 and 14-year-olds.

Michael Gove, Shadow Children’s Secretary said: "After the disaster of the SATs fiasco earlier this summer the chaos surrounding the delivery of this year’s EMAs is yet another example of the government’s failure to administer a large-scale project.

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