MANY poorer students will be shut out of the region’s universities and colleges if a shock £21m funding cut goes ahead, the Government has been warned.

Academics and Opposition politicians have urged ministers to think again as the axe hangs over the “crucial” Student Opportunities Fund.

The grants – which go to both universities and further education colleges – pay for extra support to recruit and retain students from disadvantaged backgrounds.

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Such help includes summer schools and extra tuition classes, through to helping to support internments and work placements with companies.

This year, institutions in the North-East and North Yorkshire received a total of £21.1m from the department for business, innovation and skills (BIS).

The largest grant went to Teesside University (£5.92m), with the University of Sunderland (£3.37m) and the University of Durham (£1.53m) also receiving large sums.

But FE colleges, including New College Durham (£637,563) and Cleveland College of Art and Design (£320,714), also received significant amounts.

Now internal documents have revealed that Business Secretary Vince Cable is targeting the £327m fund in the search for savings to plug a £1.4bn hole in his finances.

The draconian move comes despite Nick Clegg recently proclaiming that a drive to improve “social mobility” for the poorest was his guiding star.

A spokesman for Teesside University – which receives cash for up to 80 per cent of its students – said it had paid for a number of “award-winning schemes”.

He added: “This fund is crucial to help support our widening participation activities and ensure that people from different backgrounds have the opportunity to benefit from higher education.

“It is also vital to help raise the skills levels that the North-East and the UK need to support the economy.”

Liam Byrne, Labour’s universities spokesman, blamed the “complete mess” on funds being blown on giving loans to students at private colleges.

He added: “Now it looks like help for poorer students will be axed to pay for it.

“I'm deeply disappointed Vince Cable refused to pledge he would protect this vital help for poorer students to pursue their dreams by getting a good education.”

The controversy was raised in the Commons this week, when Dr Cable urged Labour MPs not to “rely on rumours”.

However, the Business Secretary stopped well short of denying the fund will be chopped for the 2014-15 financial year, as feared – and abolished after the 2015 general election.

Confirmation will only come when universities and colleges receive delayed letters from the Higher Education Funding Council for England (HEFCE).

BIS is also considering converting £1,000 a year from the maximum £3,250 grant received by poorer students into repayable student loans.

NUS president, Toni Pearce, said: “Cutting the Student Opportunity Fund is an absolute disgrace. The Government is backtracking on its commitment to support social mobility.”