Student debt has risen
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Charles Kennedy has been targeting the student vote with pledges to scrap university fees and introduce £2,000 grants for poorer students.
The Lib Dem leader accused Labour politicians of "pulling up the ladder of opportunity behind them".
The plans, funded by a 50% tax rate for the highest earners, would cut student debt by an average of £7,000, he said.
Labour said the plans meant restricting access to universities. But the Tories also promise to scrap tuition fees.
'Absolute principle'
Mr Kennedy said it was impossible for young people to get a foot on the housing ladder while they worked to pay off debts forecast to rise to an average of £20,000.
He said: "There is nothing more nauseating in public life to observe than the sight of Labour MPs... trooping through the division lobbies, in clear breach of a promise given in a manifesto they were elected on in the last general election, to pull up the ladder of opportunity behind them."
Lib Dem education spokesman Phil Willis said student debt had increased 240% under Labour. A recent report ranked the UK as the third most expensive place in the world to get a university education.
"This is an issue of absolute principle to us. The ability of students should be the one determinant as to whether they should go to university... not on their ability to pay."
The Lib Dems claim 68 students declared themselves bankrupt in London alone in 2004.
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We should not be saddling our young people with such huge debts as they start out in life
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However, the Institute for Fiscal Studies predicts this figure could rise to £20,000 with the imposition of top-up fees.
Labour have always said it would be impossible to fund the massive growth in the numbers at university without making students pay.
They plan to continue grants of up to £1,000 in England and plan fees up to £3,000.
Higher Education Minister Kim Howells said the Liberal Democrat proposals would be a "disaster" for students.
'Integrity'
"Like the Tories, the Lib Dems would restrict access to higher education and put a cap on aspiration, closing the door to students with good grades and restricting their life ambitions."
He said they had repeatedly refused to commit to creating the places needed for an expansion in places.
Tim Collins, Conservative education spokesman, said Labour had broken promises not to introduce top-up fees, and the Liberal Democrats had "colluded" with Labour in Scotland to introduce student charges of £2,000.
In Scotland, the executive pays students' tuition fees for them in return for postgraduate payments.
He said: "Only a vote for Conservative candidates on 5 May will not only restore free university education but also ensure the future independence and integrity of our higher education system."
The Conservatives have said their proposed abolition of fees would relate to unemployed part-time students as well as full-time undergraduates.
The Lib Dems' plans relate only to full-timers. Under Labour's plans, part-timers would continue to pay fees up-front.