His instructor has now told me that he needs to progress onto a different aircraft as he has advanced beyond the motor glider, he suggested a euro fox, he also advised me that I should be looking for an LAA permit aircraft with a mogas engine as they are relatively cheap to run and maintain. The instructor’s airfield has planning restrictions limiting it to glider, motor glider and glider tug use, but we could store the aircraft in his hangar and use his runway if the aircraft complied with the restriction by having a tow hook.
Are you sure his instructor isn't simply after a new free tug and pilot? Buy him a share (c £5000) in a Cessna 150 or a PA28.