Just one day after a mass rally in London by Students protesting against the cost of education, the Government has unveiled plans to allow Universities to raise the amounts they charge – if their teaching warrants it.

On Wednesday thousands of students descended on Whitehall angry at plans to scrap maintenance grants in favour of loans. Currently, some students receive a means-tested grant to cover maintenance costs while studying. But Chancellor George Osborne in his July Budget said these would be scrapped, offering students loans instead.

Students were already angry that the last Government introduced tuition fees, allowing universities to charge up to £9,000 a year.

The move was backed by the Lib Dems in the Coalition Government, but it reversed their previous policy of ensuring that tertiary education would be free. The issue is regarded by most as being a major reason why the party did so poorly at the General Election.

Now the Government has declared its intention to further reform university education. Business, Innovation and Skills Minister Jo Johnson has published a Green Paper outlining the Government’s thinking.

The discussion paper proposes allowing higher education institutions to raise the fees they can charge, while poorer performing ones would be penalized.

Launching a 10-week discussion period (which ends on 15 January 2016), Mr Johnson said the plans were intended to improve the current situation, raise teaching excellence and ensure that more disadvantaged students would find it easier to access tertiary education.

He pointed out that between 2009 and 2013 the number of BME (Black and Minority Ethnic) student had increased from 13.6 per cent to 18.2 per cent. However, the reforms were aimed at increasing that percentage.

There are a number of other proposals in the Green Paper, including measures to regulate the university sector, rationalizing the research funding arrangements and protecting students if their institution closes down.

A new regulatory body, Office for Students, is also being proposed to defend the rights of students.

Mr Johnson defended the plans, saying universities would, for the first time, be legally required to promote student rights when making decisions. And he said the institutions would be under an obligation to ensure value for money.

However, student groups will focus on the possible increase in fees. The NUS has already planned a mass lobby of Parliament on 8 December, and the latest proposals are expected to increase the number of students taking part.