Measures designed to benefit Jewish students applying for places in Israeli universities at the expense of Arabs have been criticised by lawyers and human rights groups.

Critics have termed the controversial measures, including a programme to provide financial aid exclusively to students who have served in the Israeli army, a form of “covert discrimination”.

The issue came to a head last week over reports that Tel Aviv University had reserved a large number of dormitory places for discharged soldiers, leaving Arab students facing a severe shortage of university accommodation in the coming academic year. While most Jews are conscripted into the military, Israel’s Arab citizens are generally barred from serving.

In addition, only former soldiers are eligible for large subsidies on tuition fees this year, under an amended law passed last month.

Arab students already face many obstacles to pursuing higher education, according to the Dirasat policy research centre in Nazareth. These include psychometric exams – a combined aptitude and personality test that has been criticised as culturally biased – and minimum age restrictions for courses, typically at age 21, when soldiers finish their three-year service.

But Tel Aviv University’s decision has come under fire because it will put further pressure on Arab students to forgo higher education.

Most Arab families live far from Tel Aviv, with limited public transport connections. High poverty rates also mean few are able to afford private rooms for their children. Arab students already complain that private landlords refuse to rent to them.

Although making up only five per cent of the student body at Tel Aviv University, Arabs won about 40 per cent of places in university dorms last year, when rooms were awarded according to social and economic criteria, said Mohammed Awadi, a Tel Aviv student leader.

“Now the university management has told us that most Arab students will be rejected because preference will be given to military service,” he said. “The message is that they would rather have a university without any Arabs at all.”

Yousef Jabareen, Dirasat’s director, said the university’s decision represented an increasingly hardline attitude from its officials.

“What is so worrying is that a supposedly liberal academic institution – not the right-wing government – is promoting discrimination,” Mr Jabareen said.

Yesterday, Joseph Klafter, the university’s president, was reported to be inspecting course reading lists for signs of what officials called “post-Zionist bias”, or criticism of Israel’s founding ideology.

Sawsan Zaher, a lawyer with Adalah, a legal centre in Haifa, said the new rules regarding tuition and housing at the university were part of the government’s “loyalty drive”, which has been decried for creating an overtly hostile political climate towards the Arab minority.

The campaign has been spearheaded by Israel’s foreign minister, Avigdor Lieberman, of the Yisrael Beitenu party, whose slogan is “No loyalty, no citizenship”.

The use of military service as a criterion for awarding student housing was ruled discriminatory two years ago by Haifa district court. The government, however, quickly amended the law, allowing universities to change their rules, as Tel Aviv University has now done.

Far-right leaders have suggested in the past the Arab minority can be encouraged to emigrate by restricting access to higher education.

Last month the parliament also approved a package of additional financial benefits to encourage former soldiers to study in “peripheral areas”, including three colleges in West Bank settlements.

Gush Shalom, an Israeli peace group, warned the law would push Israel’s academic system “deeper into complicity with the occupation” and bolster the movement for an academic boycott of Israel.

Ms Zaher warned that the government appeared determined to push farther along the same path. Last month a ministerial committee approved a draft bill that would allow private businesses to award extra benefits to former soldiers.

Although Arabs are a quarter of the college-age population in Israel, they comprise only eight per cent of the students attending Israeli universities. A Dirasat survey last year showed that half of Arab students – about 5,400 – chose to study abroad, mainly in neighbouring Jordan, because of the difficulties they faced in Israel.

Ms Zaher said that introducing discriminatory measures at universities would compound already stark socioeconomic disparities in Israel. Poverty rates among Arab families are three times those of the Jewish population.

“Rather than trying to remedy the discrimination by investing extra budgets to help the Arab community, public and private institutions are being encouraged to widen the gaps,” she said.

At Tel Aviv University, Arab students expressed concern about the new rules.

Rula Abu Hussein, a film studies student from Umm al-Fahm in northern Israel, said she had been told she must vacate her dorm by October, when her second year begins.

“It’s really hard to find affordable private rooms in Tel Aviv for anyone but if you’re an Arab it’s especially difficult,” she said.