The debate over whether to cut interest rates on student loans is moving to the Senate as part of a broader bill aimed at reducing college costs.

"We must address the crisis in college affordability that affects every low- and middle-income family and threatens our economic progress," said Sen. Edward M. Kennedy, D-Mass., who chairs the committee overseeing education issues. "I applaud the efforts of my colleagues in the House and look forward to taking up this critical issue in the Senate very soon."

The House voted 356-71 on Wednesday to pass a bill cutting interest rates on need-based student loans in half, from 6.8 percent to 3.4 percent, over five years. Kennedy scheduled a Senate hearing for next week.

Rep. George Miller, D-Calif., the sponsor of the House bill, said he was confident the interest rate cut would be passed by the Senate, given the number of House lawmakers who backed the measure. "I think the vote is a pretty big marketing tool," Miller said.

The House bill was part of a package of legislative priorities that Democrats, who won control of Congress in November, pushed as part of their initial agenda. The vote made good on a campaign promise, though the rate cut initially envisioned has been scaled back.

At first, Democrats did not spell out that the cut would only be for students who get subsidized or need-based loans. They also promised to cut interest rates on loans that parents pay and pledged to raise the maximum Pell grants, which do not have to be paid back.

Democrats said Wednesday they would get to those issues. "This is the beginning of that process," Miller said.

The broader Kennedy proposal would raise the maximum Pell grant from $4,050 to $5,100. It also would encourage more schools to participate in a program in which the government makes loans to students, rather than banks. That program is considered cheaper than the bank-based program.

The interest-rate cut approved by the House would help an estimated 5.5 million students who get need-based federal loans.

The government pays the interest that accrues on those loans while students are in college. Students pick up the payments after they leave school.

The House proposal would cost nearly $6 billion, according to the Congressional Budget Office.

To avoid increasing the deficit, the bill's cost would be offset by reducing the yield on college loans the government guarantees to lenders and cutting the guaranteed return banks get when students default. Banks also would have to pay more in fees.

The House bill requires that the rate cut be reauthorized in 2012. Democratic lawmakers say they are confident the 3.4 percent cut will be sustained.

The Bush administration and some Republican leaders opposed the measure, saying the additional money should go toward providing more grants to poor students instead of reducing the amounts graduates will owe on their loans.

"We have limited resources. We only have so much money," said California Rep. Howard "Buck" McKeon, the top Republican on the committee overseeing education issues. "My choice is to help those that need help getting into the system."

Tally Hart, senior adviser for economic access at Ohio State University, says the interest-rate cut will encourage students to stay in college, knowing they will owe less when they graduate. But Hart said more money for the Pell program also is needed.

The cuts to the student loan programs follow $12 billion in cuts Congress enacted last year.

Tom Joyce, a spokesman for industry leader Sallie Mae, says there is only so much that banks can absorb before they pass the cuts on to students.

"Cut student loan rates, fine, but don't cut the student loan program ... particularly after it was cut by $12 billion last year," Joyce said.