A University of Cambridge college’s plan to fund the term-time living costs of undergraduates from poorer families has raised fears that the end of state maintenance grants could lead towards a more Ivy League-style system of student support.

St John’s College, Cambridge has said that new undergraduates from families with a household income of less than £25,000 will be eligible for a non-repayable annual grant of £9,570 from 2016-17, the same year as student living cost grants are withdrawn by the government.

The college is also introducing bursaries to support students through the summer, enabling them to undertake internships and research placements. These payments, worth £2,000, will be available to undergraduates from households earning less than £66,154.

The support scheme is one of the most generous in the UK and could be seen as a step towards a system where student support is funded through the endowments of elite higher education institutions, rather than the government.

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Matthias Dörrzapf, senior tutor at St John’s, said that he wanted his students to be “without financial worries” and able to focus on their education during their time at university.

He said that the scheme was being brought in independently of the government’s decision on maintenance grants, but acknowledged that this would make the support provided by universities more important.

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“Universities have to look at what the government puts into play,” Dr Dörrzapf told Times Higher Education. “If this is the way the government goes, universities will have to look at how to make it possible for students to fully engage in education.”

Dr Dörrzapf said that he would like to extend financial support to students from higher income brackets, and that he would “seriously” like to consider a scheme that helped students to pay for their tuition fees, too.

The St John’s scheme is on a small scale: the term-time bursaries, a five-year pilot, will be able to support up to 24 students per undergraduate cohort, and larger universities would be unlikely to be able to match the college’s generosity.

Gill Wyness, lecturer in the economics of education at the UCL Institute of Education, said that St John’s students would welcome the funding but warned that a move towards support coming from universities rather than the government was a “worrying prospect”.

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Dr Wyness said that, since less prestigious universities had less money but more students from poorer backgrounds to support, the likely outcome was increased variation in the value of financial support, and increased income inequality in higher education.

“The numbers cap has come off, which should increase competition among universities, and that is more likely to result in pressure to compete on financial aid, particularly given the fee cap is still on, so [there is] not much competition on fees,” Dr Wyness said. “If some universities start offering big bursaries, others may follow suit.”

Dr Dörrzapf said that there was no reason why other higher education providers could not follow the lead of St John’s, highlighting that the cost of approximately £2 million over the next five years was being funded by recent donations.

“If we show this is successful, I hope others will follow,” Dr Dörrzapf added.

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chris.havergal@tesglobal.com