THE loss of a special Government grant after next year would be a bitter blow to Oxford University, say officials.

The £19m is safe for the coming academic year, but looks set to be withdrawn the following year.

The college fee is the term used to describe the supplementary amount paid per student by local education authorities to enable Oxbridge colleges to run their one-to-one tutorials and is recoverable from the Treasury.

It is thought that the college fee will be replaced with an unspecified amount of money, which will be paid to the university as a whole towards the upkeep of its historic buildings.

The university will also be entitled to bid for cash under a new scheme set up by the Higher Education Funding Council - the body which distributes university funds - to reward universities where the quality of teaching is high.

Although the money will go to other institutions as well, it is likely that Oxford and Cambridge would do well out of such a scheme.

But the loss of the college fee would still come as a huge blow to the university which has argued strongly that its maintenance was necessary to ensure that the distinctive nature and quality of teaching is preserved.

A university spokesman said nothing had been heard officially.

He said: "What we know is an announcement is due shortly.

"The university has argued very strongly for college fees to be maintained. We've explained to the government that a number of colleges would face very severe financial constraints if college fees were to be reduced."

"It's obviously too late for any changes for the next academic year."

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