THE Scottish Government's policy of providing free tuition to university students is damaging moves to get poorer pupils into higher education, a leading free market think tank has warned.

The Adam Smith Institute said students from more disadvantaged backgrounds were finding it harder to go to university because there is a strict cap on places to prevent an overspend of public funding.

In contrast there is no limit on places in England because students pay fees of up to £9000 - although they end up with much greater levels of debt when they graduate.

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The institute spoke out after a new report from the Sutton Trust concluded that young Scots from disadvantaged backgrounds face "shocking" barriers to higher education.

Research by the trust found the most disadvantaged Scots were four times less likely to go to university than those from the wealthiest backgrounds - the worst rates in the UK.

However, university leaders argued the policy of providing free tuition had made it harder for institutions to expand to improve access figures.

Sam Dumitriu, head of projects at the Adam Smith Institute, said: “These findings show high tuition fees don't deter poorer students from going to university. In fact, free tuition hurts the poorest students as it implies a strict cap on student places.

"The current tuition fee system in England and Wales is much fairer, as those who benefit the most from university also contribute the most to its costs."

Mr Dumitriu added: "Universities should be incentivised to improve teaching standards and employment outcomes by allowing them to raise tuition fees above the £9,000 cap.

"Students will also benefit from increased competition, so the government should give degree awarding powers to challenger institutions such as major employers."

However, the Scottish Government hit back arguing that access to university for students from the most deprived areas had increased by 29 per cent since 2007 when they came to office.

A spokeswoman said: "The Sutton Trust report acknowledges that progress has been made on widening access, however we are clear that there is much more still to do.

"That is why we introduced the Commission for Widening Access and have committed to implementing in full its recommendations. Indeed, the recommendations set out by the Sutton Trust are already being taken forward in Scotland following the commission’s report."

Susan Stewart, director of the Open University in Scotland, said discussions on equal access should not be limited to school-leavers.

Nearly 40 per cent of students at the Open University are from Scotland's 40 per cent most deprived communities and 64 per cent have an individual income of less than £25,000.

She said: "Part-time study is ideal for people who have families or other caring responsibilities, who are in work but on lower incomes, or who have a disability, and means that they don’t miss out on the benefits that higher education has to offer. We can’t widen access with a narrow focus.”

Larry Flanagan, general secretary of the Educational Institute of Scotland, added: "The Sutton Trust report highlights the continuing difficulties associated with poverty that too many young people face throughout their educational careers.

"Scotland has a strong education system at school, college and university level, but it is a sad truth that the greatest barriers to young people maximising their educational potential continue to be poverty and low family income."