21 Oct 2014

Students ‘paying more, getting less’

9:16 am on 21 October 2014

Universities are getting close to the limit of what they can charge for education, the New Zealand University Students’ Association says.

Universities are currently setting next year's fees and the Union of Students Associations expects all eight will raise their fees by four per cent, the maximum allowed by the Government.

NZUSA said Auckland voted yesterday to yet again raise its fees by four per cent, joining Victoria, Otago, AUT, Lincoln and Massey.

The union expects that Waikato and Canterbury will also go for four per cent and president Daniel Haines says such big increases have got to stop.

However, Tertiary Education Minister Steven Joyce says universities’ cost have gone up and the fees are fair.

NZUSA says fee increases need to stop, but universities say they need to cover their costs somehow.

NZUSA says fee increases need to stop, but universities say they need to cover their costs somehow. Photo: PHOTONZ

Since a freeze on fees was lifted 10 years ago, universities have increased their fees by as much as possible each year.

For the past four years that has led to increases of four per cent a year and most degrees now cost between $5000 and $6000 a year - roughly $2000 more than they did a decade ago.

Haines said students’ fees have been steadily rising while government funding is static or increasing very slowly.

“It is at the point where it is stable in terms of what the cost of education is and people willing to accept that cost. And I think if it is going to go any higher we are going to see a much bigger drop off of students entering into tertiary [education].”

He warned that the quality of university education is deteriorating.

“Students are paying more and getting less and that's very obvious if you're looking at the QS or Times Higher Education rankings,” he said.

“All of our universities are dropping in the rankings which show that for the hard measures such as class size and contact time and resources for tutorials, all of those things mean that we are decreasing in quality and students are getting less for what they're paying.”

READ our report on how much stock should be place in university rankings


However, the Tertiary Education Minister said students are paying a fair amount for their university fees.

Joyce told Radio New Zealand’s Morning Report universities' costs have jumped by about 70 per cent over the last 10 years.

He said taxpayers still heavily subsidise tertiary education, paying in net terms about 80 percent of the cost of students' tuition.

“They're arguing that their costs go up faster than the general rate of inflation and quite often that is the case.

“I think it is a concern that their costs are going up so fast and I do think they need to keep looking at their cost structures, because we do need to make sure that they are being as efficient as they can be.”


Universities New Zealand director Chris Whelan said universities were mindful that higher fees will deter some students, but they had little choice but to raise them.

“The problem is that costs are rising faster than the fees, so over the last 10 years the government funding per student's risen by 27 per cent, fees themselves have increased by 36 per cent and at the same time university operating expenditure's gone up by 71 per cent.

“Universities have to cover their costs somehow.”

Whelan said universities realise there would be a limit to what they can charge, but they had not yet reached that point.

*A version of this story originally appeared on radionz.co.nz