Tertiary Education Minister Steven Joyce expects pressure on tertiary institution enrolments will ease next year.
Mr Joyce told Parliament's Education and Science Select Committee on Wednesday that changes to student loan regulations will reduce the number of people enrolling in tertiary education.
Those changes will cut loans and allowances for people who fail more than half their courses and make Australians and permanent residents wait two years before they qualify for student support.
Mr Joyce says the improving economy will also reduce demand.
Several institutions have closed their second-semester enrolments because demand is so high they run the risk of breaking Government enrolment limits.