The Government's announcement that Sir Ron Dearing is to undertake a thorough review of higher education has rendered the unpopular student loans Bill a "dead duck", according to members of the House of Lords.

Peer after peer, including some of the country's leading academics, called for the Government to scrap the Education (Student Loans) Bill during the debate preceding the second reading of the Bill in the House of Lords on Monday.

Lord Morris of Castle Morris welcomed with "enormous relief" the Government's decision, earlier the same day, to set up an inquiry committee and noted that this would mean a further delay, of 12 months, in the implementation of the Bill.

But Lord Morris said that despite this the Government remained determined to press on with the Bill, even though Sir Ron's final report could well criticise provisions in the Bill and recommend another student funding mechanism.

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He said: "So we must perforce proceed to consider it, even though the debate now, and perhaps later, will resemble nothing more than the morbid anatomy of a dead duck.

"My advice to the Government, in the light of the announcement of the Secretary of State this afternoon is, even at this late stage, withdraw it. Scrap it. Take the advice of the good old English proverb: if at first you don't succeed - give up!"

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Lord Renfrew of Kaimsthorn, Disney professor of archeology at Cambridge and Master of Jesus College, said: "Although we welcome the thorough-going review which will be conducted by Sir Ron Dearing, we are told that the report will not be published until the summer of 1997. So what happens meanwhile? Eighteen months of what one might describe as 'planning blight'?"

Baroness Farrington of Ribbleton said: "The problem facing us in this House with the Bill is that the Government solution provides too little, at the wrong time, of the wrong thing."

Government education minister Lord Henley said: "I do not see any difficulties in implementing our proposals while the committee does its work. We have made it clear that it will need to take account of our intention to enable private financial institutions to make loans to students."