Papua New Guinea's University of Technology says it needs to increase its accommodation charges by five percent, because living costs have risen substantially.
The university had intended to increase fees by twenty percent, but has instead opted for a five percent rise after students complained.
However the students have since gone on strike saying most parents wouldn't be able to meet the increased costs, but they will hold a referendum later today to determine if they will return to their classes.
The pro-vice chancellor, Wilson Tovirika, says the university has already shown its good will and won't negotiate further.
Mr Tovirika says he cannot accept the students' arguments.
"The University of Technology is only asking for five percent. What that means is that for the vast majority of students, they would be only paying about 15 kina. This rate can easily be afforded by parents. So I don't believe that the parents can't afford it. That is a lot of rubbish."
Wilson Tovirika, the pro-vice chancellor of UNITEC in Lae.