I believe this was first put in place by Brymon who believed a modular pilot needed additional experience when compared to a intergrated student.
Sorry to be pedantic, but Brymon had ceased to exist by the time the current modular vs. integrated debate came into being. At that point it was CAP 509 (similar to integrated) vs. self improver (do 700hrs then take your CPL/IR tests without any formal course of training). This whole modular vs. integrated thing has stemmed from the fact that recruiters still think that modular means self improver when in fact the two routes are very very similar and both involve similar amounts of formal training.
And for what it's worth, I do believe that 500hrs tt represents a little more experience and a lot more know-how over your average 250hr graduate.