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Compensation Reconsideration

What does the future hold for Fees Free?

With national elections coming up in September this year, New Zealand's major political parties will once again be put under pressure to deal with tertiary education.

Last year when the 2019 Wellbeing Budget was released, it was announced part of the Fees Free budget would be reallocated to boosting vocational tertiary education over tertiary education in universities, due to a lower number of students taking advantage of the scheme than expected.

In a statement, the government said it “initially budgeted for Fees Free at the upper end of potential demand and we are now in a position to re-allocate an estimated $197.1 million of the funding to another part of tertiary education.”

When it was first announced, this flagship scheme was set to cost $380m per year to provide one year ‘fees free’, with no outset on costs relating to two or three years of free study.

Only limited public information has been supplied when it comes to the policy’s success.

Education Minister, Chris Hipkins, did not respond to questions from Debate, but a spokesperson issued the following statement:

“Tertiary Education Organisations claimed $270,803,199 for fees-free enrolments in 2018 and between January and August 2019, Tertiary Education Commission (TEC) paid approximately $279 million for fees-free enrolments.”

Hipkins’ spokesperson also added that the government is looking to expand fees free in future terms, however there has been no confirmation or information on how this scheme will be funded.

In addition, it is unclear whether students who have already received one year free would receive a second one or if it will remain available only to students new to the scheme.

The scheme is aimed at better educating younger generations, with two thirds of jobs this year expected to require qualifications above high-school level.

AUT Vice-Chancellor, Derek McCormack, previously spoke out about the Fees Free policy when it was first announced. He supports the move to provide better education, however believes living costs rather than course fees are a bigger issue.

"While fees are generally covered for students by an interest-free student loan that they don't start paying until they're in work, costs like rent, bus fares, the cost of food, and so on, are often the things that cause students to have to drop out or to not even start university education,” he said.

Piper Worboys, a Communications and Business student, agrees this could potentially be more helpful, saying the fees are not necessarily the barrier, but instead the cost of living and the number of hours of part-time work that is needed to make ends meet.

The National Party, on the other hand, proposes completely getting rid of the Fees Free scheme and instead introducing an offshoot of Kiwisaver which they currently call an education saver, which would have a mix of Crown, parent and child contributions from a young age.

On the other side, one of Labour’s coalition partners, the Green Party, wants to see a different approach to introducing Fees Free, with an initial maximum amount on fees and then a slow reduction of this to zero.

All three parties agree more needs to be done to provide more support around rising living costs. Zeal Gandhi, a third year business student, says simple things such as providing fuel vouchers for those who cannot access public transport would help to relieve financial stress.


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