The cost of tertiary education is increasing seven times faster than inflation, making it unaffordable for low-income families, Labour says.
Labour party leader Andrew Little said the CPI statistics from the March quarter showed the cost of tertiary and other post-school education has risen at 2.9 percent, while inflation was 0.4 percent.
The National government has put tertiary education out of the reach of many, and is locking families into generations of poverty, Mr Little said.
Tertiary Education Union national president Sandra Grey said for the last seven years education inflation has risen faster than overall inflation.
The union had been warning the government for several years that the funding of tertiary education was not keeping up with its actual cost.
More costs were being pushed on to students to meet shortfalls in funding, she said.
Students were becoming increasingly stressed as they struggled to cope with increased costs due to under-funding of the sector.
"We see massive hardship now. There's been a huge increase in things like the use of counsellors, because students are not coping with the pressure of the debt and the the hours they have to work in the paid workforce to go into tertiary education. That's not good for any of us."
Mr Little said Labour intended to provide three years' free post-school study or training for every New Zealander if it led the next government.