“With universities we did make a promise, we made a pledge and we did not keep it,” he said.
But he said at the party’s South Central autumn conference students from deprived families were benefiting.
And he added that student demand had not fallen as a result and initiatives to provide the disadvantaged with a place at university had been successful.
He said: "This has now been acknowledged. What we have done has turned to be rather sensible."
He also said that going into a Coalition government with the Tories had been “unpopular” but it was “right and inevitable” because of “a genuine economic emergency”.
“We had a financial crisis we had never seen before in our lifetimes. It could get worse we don’t know that’s why we need a stable government. What we have done is difficult and unpopular with many people but it is right and inevitable,” he said, But he admitted there were some Coalition policies that he was opposed to.
Earlier he slammed the government's immigration policy as “barmy” after hearing concerns from the floor about the damaging effect of the Conservative party's policy to cut immigration.
They were all there to quiz him over various aspects of the coalition's policies.
It comes after high-profile Business leaders raised fears about the damaging effect of the Tory policy to cap immigration numbers.
“The way it's being applied is having a negative side-effect on the economy.
“The people that are being restricted include high-quality engineers and top managers,” he said adding that it was having an impact on the number of overseas students coming from outside the EU.
“They make an enormous contribution to the British economy,” the Secretary of State said. “It's a barmy policy.”
Mr Cable also talked about how lending more money through mortgages was not a solution to the current property market crisis.
He said the next generation of people, who are currently struggling to get on to the property ladder, would have to become “more European” and rent their homes rather than owning them.
One new idea that he has in the pipeline is to set up a new bank to lend primarily to businesses in particular manufacturing companies in a bid to re-balance the economy. But he did not reveal any further details about how this would be set up nor about who would take control of it.