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The government this week restated its firm opposition to universities' excessive tuition fees after a Blairite think tank said that differentiated fees were "virtually inevitable".

Senior government spokesmen made it clear that universities could face financial penalties, provided for in the Teaching and Higher Education Act, if they exceeded the prescribed maximum annual fee, currently Pounds 1,000.

The statement followed the publication on Tuesday of a pamphlet from the Young Fabians. The widening access pamphlet said that one of the consequences of introducing tuition fees was that institutions would feel the need to charge different levels of fee to reflect the perceived quality of education they offer.