The Arts Council is urging ministers to press ahead with a review of funding for performing arts schools and support for their students.
Many institutions offering dance and drama courses are under threat because students are unable to afford fees and an increasing number of local authorities are refusing to award discretionary grants, the council claims.
Yet calls for all schools to receive some core funding from the funding councils and for dance and drama students to receive mandatory awards have so far brought little response from the Government.
Discussions between the Arts Council, the Department for Education and Employment and the Department of National Heritage over the issue are said to be "on-going", but Arts Council officials said this week that after more than a year of talks there are "still no indications that anything is about to happen".
The Arts Council began its campaign in 1993, following the publication of survey results which showed that the number of students unable to take up places due to lack of funding had increased over two years by 75 per cent, with one in six local authorities offering no discretionary awards.
Jeanette Siddall, the council's senior dance officer, said the situation for most dance students was now "quite desperate". Only one English dance school receives funding council support, leaving around 20 relying on fees to cover their costs and their students to fend for themselves with no mandatory awards.
"Students are having to work as well as train, and often cannot afford to eat well. That is very physically demanding and potentially dangerous," she said.
Charles Hart, the council's drama officer, said an increasing number of schools were upgrading their courses to degree level to attract funding and help students gain grants.
But some schools were opposed to this move because they preferred to stay independent of the funding councils and to run purely vocational courses.
"Some students who want to go to drama school have to spend months working to raise the money to cover the fees," he said.