Fees Free is gone! Winston Peters let it slip on the eighth that one of the outcomes of the upcoming budget would be the end of Fees Free, and Finance Minister Nicola Willis confirmed it. The policy has had a short and, to put it bluntly, awkward life.
Introduced by Labour in 2018, the policy made the first year of Tertiary Education free, then in 2025 the National-led Coalition Government announced it would instead be used for the final year of tertiary education following studies that claimed that students who took advantage of the first year of fees free ended up underperforming and were more likely to drop out.
The Government’s reasoning for the scrapping of fees free seems to all hover around the idea that it didn’t really do anything to increase enrolment.
In 2023, ACT Leader David Seymour called Fees Free “unfair, unprincipled and unaffordable,” and “the participation rate for 18- and 19-year-olds […] has increased by just 1 percentage point from 43 to 44 per cent. That is a failure by any standard.”
The move has been met from criticism across the aisle, with Greens Co-Leader Marama Davidson calling the decision “Outrageous”, meanwhile student associations across the country – including Te Awa Kōtui, The Waikato Students’ Union– have released statements expressing concern or outright disapproval of Fees Free being sun-setted.
WSU President Seamus Lohery spoke to the Waikato Times as well as helping to draft a joint response for associations, and potentially organising a protest next week, His column in this magazine is a reprint of a personal statement he made last week.
Beyond the parliamentary machinations, though, and just in the periphery of the frustrations students are feeling, there are the institutions themselves: The universities and tertiary education institutions these students are attending. What did Fees Free mean for the University of Waikato, what is it going to look like for our tauria now that it’s gone?
Nexus sat down with Vice-Chancellor Neil Quigley to get his perspective on the sudden changes.
NEXUS: Recently, Finance Minister Nicola Willis confirmed the government will be ending support for the Fees Free programme following this year’s budget. As a leader in tertiary education, is this a concern for you?
QUIGLEY: It is a concern. I’m concerned anytime the government looks to reduce the funding commitment for tertiary education. In this case I know that some students rely on government support and the fees free year to be able to afford to go to University, so I am concerned about that.
While students are aware of how the programme worked for them, what did it mean from a business standpoint for the University, and what was its implementation?
The University doesn’t really see much of the scheme, in the sense that whether a student pays their fees directly, or they put it on a student loan, or the government pays it for them, that doesn’t affect the revenue that the University gets.
The other way to think about it is to ask the question: Did enrollments at universities change as a result of the introduction of the Fees Free program, and the answer seems to be that no, they didn’t. And it’s not just that they didn’t change when fees free was introduced in the first year; it doesn’t seem to have made a difference with the switch to the final year either. From the University’s perspective, it doesn’t seem to have made much of a difference.
NEXUS: Were you or any of your colleagues consulted prior to the announcement of this position?
QUIGLEY: No, we learnt about it through the media just as you did. We have, at different times, reported to the Tertiary Education Commission about any potential impact that the Fees Free impact might have had, but of course we only see it from this University’s perspective, and we don’t have the information on the sector as a whole.
NEXUS: Now that we’re seeing the repeal of it, though, do you hold any concerns that this might cause a change, that we might see a drop of enrolments, like First in Family enrolments or Tauira Māori enrolments?
QUIGLEY: I think there is a potential for that drop in enrolments. The universities are going to need to be careful about trying to support students who come from those family backgrounds where they have less financial ability to afford to go to university. Our scholarship programs are helpful in that respect. We provide, obviously, some money for the hardship fund at the WSU and have just increased that.
One of the problems with many of the Government’s policies in the tertiary space is that they’re not targeted at those who do have limited financial means – First in Family, whatever criteria you might use – but are instead applied to all students, and some of those students of course come from families who can afford to provide the fees for themselves.
NEXUS: Speaking on the idea of these policies being broadly implemented: This is an election year, and we’ve had parties like Opportunity floating the idea of a Universal Basic Income for New Zealand citizens, which would take the place of Student Allowances, how do you think that would work for University students?
QUIGLEY: I haven’t looked at their policy so I can’t really comment in detail, except I would say this: There’s only a finite amount of money available to support students in the tertiary sector, so what we should be asking is: What’s the most effective way to use that money to promote students studying in the tertiary sector, and secondly, where do we think the money is most needed and are there effective ways in which you could target the financial support to those who need it most?
NEXUS Given that most acknowledge students are in a cost-of-living crisis, is this going to place extra pressure on the University to step up to the plate to provide extra assistance to Tauira who might have been relying on Fees Free?
QUIGLEY: Well Fees Free – mostly – changes the balance sheet of students, right?
NEXUS Yea.
QUIGLEY: It reduces the debt that they accumulate while going through university. There’s a limit to what the University can do about that. Think about it this way, say Fees Free costs 300 million a year. There’s a variety of ways you can spend that 300 million dollars. You could, if you were the government, negotiate with universities to reduce tuition fees across the board, and spend the 300 million dollars buying that reduction in fees. A previous government decided to do it with a fees concession for just one year, but that’s just one policy that could’ve been adopted. Universities will have to be careful in thinking about how they support students who are most in need.
We see the University as a great opportunity for students who come from low-income families, First in Family, to change their lives by coming to university and getting a degree, and we want to promote the University doing that. That will sometimes require us to do things on the financial front.”
NEXUS: How can tauira find out more about what the potential changes mean for their own study, particularly those already in study who may have factored in a year free?
QUIGLEY Well, that’s a good question. The University will provide as much information as we get, but at the moment we don’t know any more than you’ve learned through the media. The government has said that they’re looking at putting some of the money back into some aspects of tertiary education; we will find out what that actually means and what implications that might have for the students here in due course. We’ll be working with the WSU to share as much information as we can get, when we get it, but at the moment we don’t really know any more than what’s been in the media.
