George Osborne
IFS: Chancellor George Osborne's reforms could spell big student debtGetty

Conservative higher education reforms are forecast to hammer Britain's poorest students, leaving them with debts of up to £53,000 (€76,250, $82,580) by the time they leave university, a new report has found.

Chancellor George Osborne's proposal, outlined in this month's budget, to replace the student maintenance grant with a loan would see the poorest 40% of English students graduate with £12,500 more debt on average for a three year course, according to a study by the Institute for Fiscal Studies.

The grant, which is worth up to £3,500 per year and covers rent and living costs, is slated to be scrapped by 2016-17 and replaced with a maintenance loan of up to £8,200.

Jack Britton, research economist at the IFS, said: "While the small increase in support for living costs available to students from lower-income families will undoubtedly be welcomed by many, the switch from maintenance grants to maintenance loans will result in substantially higher debt for the poorest students."

The IFS forecasts the government could benefit to the tune of £2bn per year in the short term as a result of the reforms.

In a double whammy for students, Tory plans to freeze the repayment threshold for loans to £21,000 for five years could see graduate loan repayments ramped up by a further £3,800 on average per student.

The IFS calculated that while saving the exchequer an estimated £1.4bn per cohort of students, middle income graduates will end up paying more per year for the majority of the repayment period. It estimates that an individual on median graduate earnings will repay over £6,000 more in total in 2016 money.

"For most, though, it is the freezing of the repayment threshold which will do more to raise loan repayments, and hence increase the cost of higher education," Britton added.

Britton said that "time would tell" if the increase in costs will have a negative effect on those from poorer backgrounds going to university.

He said: "The 2012 reforms appear not to have had a negative effect on higher education participation amongst full-time students from poorer backgrounds. This likely reflected the fact that the system was designed to protect both that group and those with low expected lifetime earnings. Only time will tell whether these new changes will be similarly benign in their effect."