The chancellor George Osborne’s plan to introduce postgraduate loans of up to £10,000 has been broadly welcomed by the sector.

However, concerns have been raised about the government’s decision to limit the loans to students under the age of 30.

Nicola Dandridge, chief executive of Universities UK, said: “The introduction of a new postgraduate student loans system is good news.

“We support the government’s recognition of the substantial benefits arising from postgraduate taught education, and the need for support to ensure that some students are not priced out of further study. The number of students starting a postgraduate taught course at a UK university fell by 10 per cent in the two years between 2010-11 and 2012-13.”

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Steve West, the University Alliance chair and University of the West of England vice-chancellor, said: “We strongly welcome the chancellor’s announcement today to develop a government-backed postgraduate loan system. ​Postgraduate study is vital to ensure ​Britain develop​s​ and grow​s​ global talent, which will be key to our future success.”

He added that the announcement “has the potential to create a fairer system for people who want to study a higher degree and transform their life chances”.

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Michael Gunn, chair of the Million+ group of newer universities and vice-chancellor of Staffordshire University, said:  “Postgraduate study has declined significantly in recent years and the chancellor’s announcement that a new postgraduate loan scheme will be introduced will be warmly welcomed by universities.

“However, the announcement only refers to young students – this scheme must be extended to all who want to study for postgraduate qualifications.”

Megan Dunn, vice-president for higher education at the National Union of Students, said: “NUS and students’ unions have been persistent in calling for financial barriers to be removed from access to postgraduate study, and today’s announcement is a major step in the right direction. NUS and students’ unions have been central in developing the conversation and lobbying decision makers across the country.

“Creating a government-backed postgraduate loans scheme will make a fundamental difference to the lives and opportunities of students. Many postgraduates are currently funding their study through potentially disastrous measures such as credit cards, overdrafts and personal loans.”

David Phoenix, vice-chancellor of London South Bank University, said: “No one should be denied access to postgraduate education simply because of cost. I welcome today’s announcement from the chancellor, however I urge careful consideration of how the loan system is implemented.

“Many businesses fund their employees through postgraduate study and institutions like London South Bank University work with those businesses to ensure students gain real world skills that can be applied in the workplace. I strongly urge the government to consider a system of match-funded loans to ensure business-university partnerships are not undermined.”

Nick Hillman, director of the Higher Education Policy Institute, said that Osborne deserved “two and a half cheers, which is as good as it gets in austere times”.

He added: “Postgraduate support was unfinished business from the 2012 university funding reforms and the new scheme is welcome.

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“It will open up postgrad study to more people. The age limit will be frustrating to those who miss out and people will doubtless lobby against it. But it is a preferable starting point to many alternatives, like restricting the loans to certain subjects.”

Greg Clark, the universities, science and cities minister, said: “By introducing postgraduate loans, students will have greater flexibility to gain the qualifications they need to get on in life and give the UK the skilled workforce we need to secure long-term economic growth.

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“Our announcement today shows we are determined to make education more available to all people. I welcome contributions to our forthcoming consultation to ensure that we get the detail right and so maximise these benefits.”

Sally Hunt, University and College Union general secretary, said: “It’s positive that the government has moved to address the current crisis in postgraduate funding, but encouraging people to accrue more debt is not the best way to attract the best and brightest into further study.

“If we really want to expand the number of UK postgraduates, government must consider even more radical ideas such as restoring proper grants or writing off part of a student’s undergraduate debt when they complete a postgraduate course - as currently happens for access courses students.”

Wendy Piatt, director general of the Russell Group, said: “Postgraduates are critically important to the economy and society as a whole and the chancellor is right to help ensure there are no barriers to participation in postgraduate taught study.

“We welcome the government’s reassurance that this significant investment in postgraduate support will not create additional regulation, restrictions or costs in the future or divert funds from existing budgets for research and teaching. We are also pleased that the loans are not restricted to certain subjects and that the system is clear and simple to understand so that most students considering postgraduate study can be sure they will receive financial help.”

Sir David Eastwood, chair of the Russell Group, said:“The Chancellor is to be congratulated for developing a funding model which will enhance investment in higher education without repurposing existing expenditure.”

Don Nutbeam, vice-chancellor of the University of Southampton, said: “Although details of the operation of the loan scheme are currently sparse, it represents a step in the right direction. In due course, I hope that the scheme can be extended for those above the age of thirty, taking advantage of higher education mid-career to upskill and change career direction. But this is a good start.”

Tony Strike, director of strategy, planning and change at the University of Sheffield, said: “As chair of a consortium of six Russell Group universities, which was given £3 million as part of a Higher Education Funding Council for England project to widen access to postgraduate education, my view is a state loan system is welcome as two thirds of those who say they are unlikely to take up postgraduate study say more financial support may help change their mind. However, on its own it won’t help those from the least well-off backgrounds nor ensure fair access to the professions.

“The majority of current postgraduate students are in the fortunate position that they can and do pay, so the first problem with a state loan scheme is that it’s not very efficient – it will displace with taxpayers’ money the private investment that most postgraduate students are currently putting in.

“The second issue is that a third of our undergraduate alumni have said that while they’d like to do a postgraduate course they don’t want to add to their debt burden.”

Stephen Lee, chief executive of the thinktank CentreForum, which has long recommended a postgraduate loans system, said it was “important to remember that a majority of postgraduate taught students are over 25, so the policy might not capture every person for whom loan entitlement would be a decisive factor in a doing a master’s degree. We urge government to consider raising the age limit to include people in their thirties.”

He added: “It is not yet clear whether the loans scheme will cover fees, maintenance or both. There are certain advantages of not linking it just to fees because that could act as signal to institutions to raise their fee levels to £10,000.”

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And he also said: “A further question is whether those individuals who have both undergraduate and postgraduate loans will have to pay back their debt at higher annual rate than those with undergraduate debt only?”

john.morgan@tesglobal.com