The report recommends significant increases in maintenance grants available for disadvantaged students.
The proposed increases were welcomed last night by the Union of Students in Ireland (USI), but it said they did not go far enough.
Disadvantaged students who live away from home should get £3,000 a year, says the report. Before Christmas the Minister for Education, Dr Woods, said £2,000 would be paid this year.
For students living at home a grant of £1,200 should be paid, the report recommends. This compares with the Department's current rate of £1,000.
The action group chaired by Dr Cormac McNamara says it has to work within the constraints of the national development plan which set aside £95 million for all third-level access initiatives. If more than £95 million was available, the group says it would set higher levels of grants for disadvantaged students.
Those living away from home would receive £3,500, and those living at home would get £1,300. About 8,000 students would be covered by those grants, which are allocated to students from homes where the parents are on welfare for a period.
The report notes the difference between various social welfare payments and the general student grant. It says there is "little rationale" for this when students and those receiving social welfare often incur similar costs. It calls for a "benchmarking exercise" to begin on this issue.
The USI president, Mr Julian de Spainn, said the ordinary maintenance grant should be set at £3,905. With rising rents the grant was becoming "ludicrously inadequate".
He said the Government needed to spend another £25 million to improve a range of student supports; it was regrettable the report was constrained by what was laid down in the national development plan.
"We welcome all these steps, but there is some way to go, and this benchmarking exercise should begin as soon as possible," he said.
The views of Dr McNamara's group come at a crucial time. Dr Woods announced recently that a special project team would conduct a comprehensive review of the whole grants system. This would include examining whether current payments were sufficient for the needs of today's student.
The report states: "The action group believes that this review constitutes a unique opportunity to develop a new and more coherent framework of financial supports. We believe that the work of the special project team should take into account the views of the action group on key aspects of student financial supports."