Right here's the deal:
#1 priority is to make him understand that he needs to live frugally and not piss his loan away. 18 year olds dont fully appreciate the value of money and that it WILL have to be paid back and will feel like a considerable millstone round his neck when he leaves uni and go into work. The overriding aim is to leave uni with the minimum debt he possibly can.
So explain that while he will see all his mates etc going out all the time, using their loans to buy PCs/hifi/games/DVDs/CDS etc, he must resist the urge at all costs and spend as little as possible. This is paramount. By all means, have a fun few weeks constantly on the piss at the start, then it's time to rein it in and budget. Never let fellow students know you have any money and never lend anyone money. Lie and say you're skint if you have to.
Getting a job is beneficial in a number of ways past the obvious financial incentive. I did aerospace engineering at uni so not exactly a 'mickey mouse' degree and I still found the time to work part-time in a cinema which did not have a detrimental effect on my studies. Bit of cash and a great laugh at the same time, met some of my best mates there who I never would have met otherwise.
Of course the stuff about budgeting will probably be in one ear and out the other but you can only try.