Unfair and regressive student bursary schemes are contributing to inequalities in higher education as universities use them to their own advantage rather than to help needy students, new research suggests.

Claire Callender, professor of higher education policy at Birkbeck, University of London, found that bursary and scholarship programmes often contradict the Government's aspiration to help low-income students.

Professor Callender's research, presented at an Association of University Administrators conference this week, revealed that in the 117 institutions analysed, 303 distinct schemes were being run in 2006-07.

This "highly complex" and confusing system was a factor in 12,000 low-income students failing to collect bursaries, she said.

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Of the 303 schemes, 60 per cent were needs-based and used primarily to widen participation. However, they were not distributed evenly across the sector, being concentrated in the most selective universities, such as those in the Russell Group.

There was also disparity in the sums awarded - the higher-ranked universities were the most generous. The Russell Group's average was ?1,791 a year, whereas the 20 or so lowest-ranked institutions offered an average of just ?642 a year.

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Professor Callender's report states: "The poorest students at the most prestigious institutions received nearly three times more institutional aid than their peers at the least prestigious institutions."

One third of all bursaries were allocated on merit. Schemes of this sort were most popular in middle-ranking institutions, as a way to attract the brightest students and improve their overall standing. Professor Callender's report says this approach is "highly regressive", benefiting students from middle-income families who do not need the money while diverting money away from low-income students.

john.gill@tsleducation.com.