The government may cap tuition fees at £7,000 a year, Vince Cable said today, as he told MPs he accepted the thrust of Lord Browne's report proposing a radical overhaul of higher education funding.

In statement to MPs, the Liberal Democrat business secretary scrapped his party's policy of opposing tuition fees - but he may still face rebellion from his backbenchers. Before the election all Lib Dem MPs, including Cable and Nick Clegg, signed a pledge opposing tuition fees.