Student associations are calling for an urgent bump in support payments amid soaring rental prices in Auckland.
But the Government maintains it provides the "one of the most generous student support systems in the world".
Over the past five years, the price of renting a room in a three-bedroom home in the city has jumped from $175 to $250 a week, according to the Union of Students' Associations' 2017 income and expenditure report.
The survey yields email-based responses from 1000 students across 11 universities and polytechnics and is conducted every two or three years.
Union president Jonathan Gee said the $217 students could receive in allowances at present did little to provide relief, and that student hardship had grown "considerably" worse since 2011.
"That year, the Government froze the parental income threshold for eligibility, a significant factor in locking out 24,000 students from having access to the student allowance."
Mr Gee said only a third of full-time students now received allowances, contributing to growing student debt as the remainder had to borrow.
The association is calling for the parental income threshold to be unfrozen and the allowance to be raised.
The report also highlighted concerns that not enough was being done to get students from low-decile high schools into tertiary education, with only a third of graduates from decile 1 to 3 schools attending universities, compared to two-thirds from decile 8 to 10 schools.
The association has also asked the Government to consider a scholarship for those that are the first in their family to attend a tertiary institution.
Tertiary Education, Skills and Employment Minister Paul Goldsmith says the Government spends $4.1 billion on funding the tertiary education sector each.
Around 28 percent of that is spent of supporting students in their studies, including $490 million on student allowances.
The Government spent more than $1.14b on financial support in 2015/16, Mr Goldsmith says.
"Like many other countries, New Zealand has a cost-sharing model to meet increasing tertiary education costs.
"On average, taxpayers pay around 82 percent of the course costs, once interest-free loans are included, while students pay the rest. As well as that, taxpayers make a contribution to the students' living costs either through allowances or student loans. We think that balance is reasonable," Mr Goldsmith says.
The Green Party believes the survey's results are because of the Government's failure to tackle the rising cost of living.
"National should be making it easier, not harder, to make ends meet while studying in New Zealand," tertiary spokesperson Gareth Hughes says.
"Access to a quality, affordable education should not be reserved for people with wealthy parents.
"New Zealand wants a world-class education system, but if students can't afford heating, housing or sufficient food, how are they supposed to focus on learning?"
He's calling for major reform to the student support system so they can have "decent living standards".
Newshub.
