Oxford is facing a drain on talented students from poor families because of tuition fees, Liberal Democrat leader Charles Kennedy has warned.

During a visit to the city yesterday, Mr Kennedy urged the Government to follow Scotland's example and scrap the fees to allow more needy youngsters to attend.

His visit followed Tory leader William Hague's trip to Oxfordshire as district council election fever hots up.

He met students at St Peter's College, New Inn Hall Street, who voiced their concern at the talent drain. Mr Kennedy said: "The rest of the country should be on the same basis that will apply in Scotland there will not be an imposition of tuition fees at the time of becoming a student.

"We would also reintroduce grants to help less well-off students. Without a shadow of a doubt it is stopping talent coming through. And it is perverse that it stops those below a certain income coming to our universities.

"They are the very people who should have the chance of university education and the opportunities that follow it."

He also voiced deep concern at Government plans to change the way benefits are paid. At Islip Road Post Office the Lib Dem leader met David Olley, of the National Federation of Sub-Postmasters, to hear fears of post office staff over their futures. Mr Kennedy said he hoped the Government would change its plans for credit transfers, where benefits would be paid directly into banks rather than be paid at post offices.

"I was told that if these changes go ahead, about 50 per cent of the business would be lost at this particular office," he said.

"I also met residents who told me they were concerned at what could be the total loss of their local post office.

"That reflects what I've been hearing all over the country. I want the Government to think again. They should realise this is of grave concern and I hope they will back off." At Cutteslowe, he met his Lib Dem parliamentary colleague Dr Evan Harris, the member for Oxford West and Abingdon.

Mr Kennedy visited the former Kidlington Family Centre, now called the Kaleidoscope Centre, where he talked to staff and users of the project.

He also gave his support to the controversial Oxford Transport Strategy by saying: "Oxford is a community with immense transport pressure upon it. I haven't seen enough of the OTS to say if it is working or not working, but anything that tries to improve the situation has to be welcome."

He later met Liberal Democrat hopefuls in the forthcoming Oxford City Council elections.