Experts convened by the College Board called yesterday for major changes to the nation's student aid system, including a simplified application process and tax-free savings accounts for needy students.

The existing $86 billion federal network of grants, loans, work study and tax benefits is needlessly complicated and a growing barrier to students from low- and moderate-income families, according to the 12-member Rethinking Student Aid study group.

It is "a piecemeal, rickety financial aid system that no longer serves student or work force needs," said group member and Spencer Foundation President Michael McPherson.

Among the group's recommendations:

• Scrapping the current Free Application For Federal Student Aid (FAFSA), and instead letting the Internal Revenue Service provide information needed to determine eligibility for aid, including the Pell Grant. Families getting means-based public benefits would be eligible for the maximum Pell award without IRS data, and Pell awards would be based on family size, adjusted gross income and would see yearly increases tied to the Consumer Price Index.

• Remove distinctions between subsidized and unsubsidized loans and transfer those subsidies toward students who are in repayment.

• Create accounts proportional to Pell grants for children of low-income families and allow the accounts, strictly for postsecondary education, to grow tax free, akin to federal 529 programs that have benefited more affluent families.

• Offer campuses financial incentives to promote retention of low- and moderate-income students.

The study group joins a growing chorus of analysts, politicians, researchers and others who say the current financial aid system is one reason the nation is losing ground to educational systems in other nations.

In 2006, U.S. Education Secretary Margaret Spellings called for scrapping the financial aid system as part of an overhaul of American higher education.

Though the Higher Education Reauthorization Act, passed by Congress only last month, would have to be amended, the climate may be right for major financial aid changes, said David Hawkins, director of public policy and research with the National Association for College Admission Counseling.

"Their recommendations are strong, and we encourage policymakers to seriously consider them," he said.