The organisation which represents businesses has reservations about the Government's decision to cut planned increases in spending on tertiary education institutions.
Business New Zealand says it could harm the country's productivity in the long-term.
Finance Minister Bill English says the increases for universities and polytechnics announced in the previous Labour-led Government's budget are not funded and will be dropped.
Canterbury University Vice-Chancellor Rodd Carr says if spending is not increased, universities will have to start restricting access to courses.
Business New Zealand's chief executive Phil O'Reilly says that is a worry. He says if there is one advantage of the recession, it is that more people are looking at tertiary education to learn new skills.
Mr O'Reilly says it is important those going to the country's universities and polytechnics still get a quality education.
Dr Carr told Morning Report if universities do not begin to limit student numbers, by 2011 they could be providing up to $20 million of services that are not paid for.
Dr Carr said the Government, through the Tertiary Education Commission, has threatened to penalise universities which continue to expand.
The Budget will be delivered on 28 May.