Sean Farren, Northern Ireland's minister for higher and further education, has stopped short of abolishing tuition fees in his proposals for student support.
The prospective £65 million package sidesteps the Northern Ireland Assembly's demand for fee abolition and breaches the election manifesto of Dr Farren's party, the SDLP.
But students from low-income families will be able to apply for means-tested grants of up to £1,500 from next September. The National Union of Students-Union of Students in Ireland claimed a "partial victory", warning that fees would be a continuing deterrent, but welcomed plans for grants, childcare awards for low-income mature students and extra places.
Students at Queen's University, Belfast, welcomed the move and said Dr Farren had got the balance about right.
But the assembly's higher and further education scrutiny committee voiced disappointment that the minister had not moved to abolish up-front fees. Chairman Esmond Birnie said: "It is a start, but the devil may lie in the detail."
Dr Farren said axing fees would shift funds away from lower-income families. He said that raising the residual income threshold for fee payments from £17,800 to £20,000 would mean more than half of students would not pay.
Fees have been abolished for full-time further education students over 19 taking courses in key skills, including electronic engineering, construction and hospitality and catering.
There will be means-tested skills bursaries for full-time further education students over 19 to replace discretionary awards.
The new threshold for fee payments will apply only in Northern Ireland universities, but the bursaries will apply to Northern Ireland students wherever they study.