Three years' education would cost $1.2 billion from 2025 but universities fear it would worsen under-funding.

A new Labour policy giving three years' free study could contribute to a decline in the quality of education if it is not supported by extra funding for each institution, universities say.

Party leader Andrew Little revealed in a State of the Nation speech in Auckland yesterday it would provide three years of post-school study for every person in the country without a previous tertiary qualification.

It was welcomed by students and the Tertiary Education Union.

Chris Whelan, the executive director of Universities New Zealand, which represents all universities, said he was more hesitant to give full support. Loans put off some people - particularly those from lower socio-economic groups - from entering study, he said, so it would be good in that aspect.


However, he said it did not deal with the under-funding of universities, which had seen a worsening teacher-student ratio and gradual fall in international rankings.

"We trust that Mr Little will also commit to lifting the institutional funding that will be needed to maintain teaching quality for the increased numbers of students," he said. "Without this, this policy will just hasten the decline in the quality of our university system."

The university system was under increased pressure, Mr Whelan said. It had seen an increase from 8 per cent of young people going to university in 1992 to 38 per cent now.

Per-student funding had declined 17 per cent in real terms, and universities were struggling to attract international researchers, and keep up teacher-student rations.

"We can offer a world-class education - we are unusual in that all of our universities are world-ranked - but we are sensitive to anything that is going to pressure the system," he said.

Labour has announced a multi-billion dollar plan to provide every New Zealander with three years of free tertiary education.

Everything from ratios, to the size of laboratories or libraries could impact the quality of the educational experience, he said.

"The system can handle some accommodation, I just don't know how much. A few per cent would be ok but 10 per cent might be a bit much."

Currently around 180,000 people attend university.

Labour said it expected a 15 per cent uptake in tertiary study as a result of the policy which also included polytechnic courses and apprenticeships.

In his speech, Mr Little said the $1.2 billion policy would come from cash earmarked for tax cuts, but would not be fully implemented until 2025 - meaning the party would need to be elected for three terms to see it through.

"We've got to be fiscally responsible," Mr Little said. "This is about what size bite we can bite off. We don't think we can do it in one [fell] swoop in a single term, so we will phase it in over time.

"It will come down to a choice. The Government has always got money for physical infrastructure, roads and that, but at some point we have to make an investment in our people," he said.

The policy would go hand-in-hand with a review of the tertiary sector, including a tightening on which courses were government-funded and a round-up of rogue tertiary providers, Mr Little said.

"I'm not sure homeopathy for pets is the sort of thing when we're thinking about the future of work and re-training, not sure it's the kind of course we would fund," he said.

Asked if there were more policies planned to reduce the cost of education, Mr Little said yes.

The details of those policies had not yet been worked through, however Mr Little has previously said he wants voluntary parent donations to schools scrapped, with the Government making up the shortfall.

National's tertiary education spokesman, Steven Joyce, tweeted the party "wants to take more than a billion dollars a year more off taxpayers to achieve absolutely nothing", adding the hashtag "desperate". He also posted the policy was "stealing massively from an expensive internet-Mana policy".

Former internet-Mana co-leader Laila Harre said she thought Labour's policy was "fantastic" and slammed Mr Joyce's tweet as "negative spin" from National.

The Tertiary Education Union and the New Zealand Union of Students' Associations (NZUDA) were positive, although NZUSA head Linsey Higgins said it would like to continue to talk to Labour about what could be done for those studying now.

Economist Dr Ganesh Nana said the policy did not raise "any red warning lights".

"A billion extra on education spend, yes it's a big amount, but I don't think it's out of the realms of possibility given the potential benefits."

He did "raise issues of where it comes from", but said "that's a decision that needs to be made by the people in terms of our priorities".

What it means

• A Labour Government would bring in three years of free post-school education over a person's lifetime.

• Could be used for any training, apprenticeship or higher education approved by NZQA, and for fulltime or part-time study. The three years wouldn't have to be consecutive.

• Would cost $1.2 billion from 2025, with the first year funded from money earmarked by the Government for tax cuts.

• Would be introduced in phases, with one year's free education available from 2019, two years from 2022 and three years from 2025.

Labour's promise of free education would be too late for current University of Auckland student Samuel Brebner. Photo / Michael Craig
Labour's promise of free education would be too late for current University of Auckland student Samuel Brebner. Photo / Michael Craig

Promise too late for this student

Labour's promise of free education would be too late for current University of Auckland student Samuel Brebner - though he hopes it would at least help his younger sister.

The law and arts student, who comes from Tauranga, has just finished three out of his six years of study.

His fees alone were around $7000 a year, his course-related and accommodation costs pushed this up to around $20,000.

All going well he is due to finish in 2018 - just one year out from when Labour planned to make good on its promise.

Mr Brebner said the offer of free education would have been useful for many students like himself.

"I'm from a middle-income family, my parents are just above the cut-off for a student loan, but don't have the surplus to pay anything to my education."

However, while Labour's plan would do little to ease his debt, Mr Brebner had hopes it would at least ease the burden for his younger sister, 14.

Mr Brebner said she'd only just come through that stage of wanting to be an astronaut or a police woman.

"She's a bit of a wildcard."

But he said if she did decide to pursue higher education, the promise of it being funded by the Government offered some comfort.