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The £2,000 fee Scottish students currently pay after graduation is to be scrapped.

Fiona Hyslop, education secretary, told the Scottish parliament that the graduate endowment had "clearly failed" and explained that current and subsequent students would not have to make the payment.

Ms Hyslop emphasised that Scottish education should be based on the ability to learn, not the ability to pay.

As reported by the BBC, she continued: "It must therefore be wrong to burden our graduates with debt and deny them with every possible opportunity to contribute to a wealthier and fairer Scotland.

"It is a wrong that they begin their working life encumbered by financial pressures and it is a wrong this new Scottish government intends to put right."

However, political opponents have challenged the move.

Murdo Fraser, Conservative education spokesman, accused Ms Hyslop of failing to address the real issues facing Scottish students.

He added: "She must be aware about the growing concern there is among Scottish universities that they face a competitive disadvantage as against English institutions due to the additional revenue derived by top-up fees.

"The real issue is how to fill the funding gap and on this issue the cabinet secretary has not one word to say."

In related news from across the border, it recently emerged that English students borrowed almost £377 million to pay their tuition fees in 2006-7.