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The country's largest university has given itself power to restrict entry to all undergraduate courses from 2009.
Critics say the change, which was confirmed yesterday, will create an elitist institution that will shut out students from disadvantaged backgrounds.
The Auckland University council voted 14-2 to allow itself to
restrict student numbers.
From next year, a new Government regime will restrict student tuition funding for all tertiary institutions, meaning they will no longer get money for every student enrolled.
Entry to around half of Auckland's undergraduate courses is already restricted, but from 2009 this will apply to all such courses.
Yesterday, 15 people held a protest outside the university before the council meeting.
Protester Efeso Collins, a researcher and former community liaison adviser for the university, said most Pacific Island students enrolled in open-entry courses.
Students from poorer backgrounds would be excluded under the new regime, he said, and the university would favour students from rich, white schools.
"This will shut them out and create a whiter university. Shame on Auckland University ... This will further create an underclass."
Sociology lecturer Dr David Bedggood, a member of the Association of University Staff, said the move would create inequality and make it harder for people to get into university.
"Everybody should have the same right to achieve to the best of their ability. [This will] stack the deck with those with money and those from good schools. We will get a pecking order that will replace egalitarianism with elitism."
Auckland University Students Association education vice-president David Do was upset at the move and critical of the lack of consultation on the matter.
"I'm very disappointed. Students from richer backgrounds will push out students from poorer backgrounds."
Vice-chancellor Professor Stuart McCutcheon said the proposals set by the council provided the tools needed to set limits in 2009, should it become necessary.
"Overall, student numbers will not decrease and in practice we expect the impact to be minimal.
"However, without this precautionary measure we could find ourselves with unfunded students in the future.
"The university cannot afford to carry large numbers of unfunded students."
Professor McCutcheon said the university would continue to seek a diverse range of students with the ability to succeed at an institution that prides itself on excellence.
"We are committed to both equity and excellence and do not see these goals as mutually exclusive.
"Currently 19 per cent of the country's Maori university students and 42 per cent of Pasifika university students are studying with us," he said.
A taskforce has been set up to ensure prospective students from all backgrounds have equal opportunity to achieve their potential.
The Tertiary Education Commission, which provides funding on behalf of the Government, said last night that details of its funding plan would be revealed on Friday.
A spokesman said other universities could possibly follow Auckland's lead, but it was up to them to manage their enrolments within their agreed plans.
A spokeswoman for Tertiary Education Minister Pete Hodgson said last night that he had no comment until the funding plans were revealed on Friday.
The University of Auckland's strategic plan for 2005 to 2012 requires it to grow more slowly than in the past decade from its present roll of 38,000 and to increase the proportion of postgraduate students from 18 per cent to 22 per cent.
