The higher education minister has announced an expansion of vocational university degrees.

Alan Johnson said an additional 10,000 places for foundation degrees would be made available for the next academic year.

He argued that the two year courses have been a success and were meeting the needs of employers.

The government is committed to making 50,000 full time or equivalent foundation degree places available by 2005-06.

"We have made very clear that higher education expansion does not mean more of the same," Johnson said on Tuesday.

"We need expansion to reflect the needs of the economy and the economy is telling us it needs more graduates with specific skills at a particular level.

"Foundation degrees are higher education qualifications of academic rigour and clear vocational relevance which have been built with employers to help meet the needs of the workforce.

"They are proving [to be] successful and popular."

The vocational degrees are also being used to increase the drive towards the target of 50 per cent of young people gaining a graduate qualification by 2010.

But Johnson denied they were taking the place of traditional honours degrees.

"I want to make clear that this exclusive focus on foundation degrees does not represent a threat to the availability of honours degree places," he said.

"We are not going to force students to do courses they do not want to do."

Ahead of the announcement Johnson used his first newspaper interview since his appointment in June to pledge that student grants were here to stay.

Defending Labour's proposed higher education funding package, the minister dismissed reports that the £1,000 bursaries for poorer students would be put towards tuition fee remissions.

"I assure you it will stay as a grant. Whether the students decide themselves that [since] they've got that £1,000, they'll use it to pay off some of their fee, is a matter for them," he told the Guardian.

Labour scrapped the few remaining student grants when it came to power in 1997.

However the funds were brought back as part of the university funding review earlier this year in order to appease critical backbenchers who said the plans would price working class students out of education.

But Johnson insisted efforts were being made to exclude the poorest students from tuition fees altogether.

"We're passionate about this and it would be really good to say, 'OK, the issue in terms of fees is a non-issue' - as it is at the moment for youngsters from the poorest backgrounds," he said.

"We're going to try and find a way to do that."

And he argued that fixed rate fees, as opposed to the variable top-up charges proposed, would hinder rather than help the situation.

"Some universities will charge nothing for courses," he said.

"They are prevented from doing this if you introduce this fixed rate, just as they are now."