Giving evidence to a House of Lords subcommittee inquiry into European higher education policy, Liam Burns said he broadly supported the Erasmus Master's Degree Mobility Scheme outlined in the proposed Europe 2020 Strategy.

Under the scheme, postgraduates would be able to access a bank loan backed by the EU to finance their studies in another European country. It is part of efforts to ensure that 20 per cent of all students undertake some study abroad by 2020.

"Any move that could give access to funding will be beneficial," Mr Burns told the committee last week. "The caveat is that it should be subsidised, not [offered] at commercial rates...We think the EU is right to pursue [a subsidised system]."

His support for the proposal contrasts with the position of the European Students' Union, which claims that the loan system would have little appeal for poorer, debt-averse students and could lead to more provision for loans rather than grants.

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Instead, it has urged the EU to concentrate funding on Erasmus grants to reach its 20 per cent mobility target.

But Mr Burns said the ESU's scepticism derived from the limited experience of student loans in mainland Europe, whereas UK students were more conversant with the idea of subsidised state-run loans.

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Some form of finance for postgraduate students was better than nothing, he suggested.

Mr Burns also highlighted several issues that deterred UK students from studying abroad on the Erasmus programme.

Thirty-seven per cent of students had cited financial obstacles, he said, despite fairly generous Erasmus bursaries being available.

More targeted support for those from low-income backgrounds would help more students benefit from the scheme, which was accessed more frequently by those from well-heeled families, Mr Burns said.

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The "girlfriend-boyfriend" effect was also important, he added, as students were often unwilling to leave their friends, social scene or part-time job to study abroad.

He also urged the Universities and Colleges Admissions Service to open itself up to foreign universities seeking to attract British students, saying its current focus solely on UK institutions was "untenable".

jack.grove@tsleducation.com.