Rebels stand firm despite concessions on fees

Tony Blair was facing a Herculean task last night in his attempt to allow universities to charge top-up fees after his rebel backbenchers warned that a raft of concessions did not go far enough.

Backbenchers queued up to condemn the centrepiece of Labour's Higher Education Bill, which will allow institutions to charge up to £3,000 a year in top-up fees.

More than 100 Labour backbenchers are thought to remain solidly opposed to the plan and the Government needs to limit the rebellion to 81 to avoid a humiliating defeat.

The crucial second reading vote on the Bill has been pencilled in for 27 January but will be delayed if Lord Hutton has not produced his report on the death of David Kelly by then. Mr Blair has made the vote an issue of confidence in his leadership and government whips will appeal to Labour MPs not to add to the Prime Minister's woes by defeating his main policy.

Charles Clarke, the Secretary of State for Education, acknowledged that his and the Government's authority would be "weakened" by a defeat. He announced a comprehensive package of extra grants, loans and bursaries for the poorest students and promised to review top-up fees after three years. Mr Clarke told MPs that the principles of the Bill were not negotiable. He said: "This is a coherent package to be taken as a whole or not at all. It is not a pick-and-mix menu."

But there were signs that his "take it or leave it" approach might backfire. Even loyal MPs warned that the principle of variable top-up fees was not acceptable, while rebel leaders insisted they would muster enough Labour MPs to defeat the Bill. One said: "That is what people have a determination to do at the moment."

Government whips insisted that the opposition was less vociferous than expected, but opponents said that Mr Clarke had failed to convince enough MPs that the reform would not create a two-tier university system and lead ultimately to an "ivy league" charging fees of up to £15,000 a year.