Labour has unveiled a policy for free undergraduate study, saying its Working Futures Plan will provide for three years of post-school education.
Leader Andrew Little announced the policy at the party's State of the Nation address in Auckland today.
The plan will cost an estimated $265 million in its first year, and an estimated $1.2 billion at full implementation.
"Our Working Futures Plan will mean that no matter what path someone wants to take after school, be it university or an apprenticeship, they will be able to get the skills they need to succeed without being shackled with years of debt," says Mr Little.
The policy will cover education across a person's lifetime. However, it would only apply to new undergraduate study, and not those who already have student loans and want to return to studying.
"This will be available throughout a person's lifetime, so that it can be used for retraining or if someone changes career part way through their working life," says Mr Little. "It will mean our businesses will always be able to find the skilled workers they need to succeed."
It would be phased in, starting with one year of free post-school education in 2019, two years in 2022 and three years in 2025.
Mr Little says the money is there to pay for the policy, but the Government has ear-marked it for tax cuts.
There will be no age limit on the free post-school education and no changes to existing living allowance or course-related costs.
The three years don't have to be used all at once - a person could complete a one-year course after leaving school and later on take another two-year course.
"Labour will prepare New Zealand for the future with a world-leading education system supporting the innovative and job-rich economy we need to get ahead," Mr Little told his open-air audience at Auckland's Albert Park.
"This is a big, long-term investment.
"The money is there, we can afford to do this because there is no better investment than our people and their futures."
Tertiary Education Minister Steven Joyce says it would be likely to cost a lot more than that with no gains for the country.
"The key thing is that it would achieve nothing for tertiary education," he told NZ Newswire.
"If anything it would make it go backwards because as soon as it's free you go back to the bad old days of short courses, very low rates of achievement and spiralling costs."
Mr Joyce says the policy is about taking more than $1 billion a year off one group of people, taxpayers, giving it to a smaller group of people and achieving nothing except going back to the days of bums on seats.
"Fundamentally it comes down to whether anyone should make a contribution to their study, and whether it's fair to do so," he said.
"We would argue that a contribution of about 30 percent of the value of courses is important to make - people who achieve a degree earn about 50 percent more a year on average than those who don't."
Mr Joyce thinks Labour hasn't considered the increase in student numbers that would result from its policy.
"More people will sign up, sure, but it's free and they don't have to achieve anything."
ACT leader David Seymour says Labour just wants to be popular.
"Labour's approach to education is funding for votes, and quality be damned," he said.
"Moreover, students will have no skin in the game.
"Right now the deal is you back yourself, borrow a quarter of your course cost and the taxpayer picks up the remaining three-quarters.
"With Labour, everybody will have a certificate, it just might not be a very good one."
Government funding for tertiary education has risen 3.5 percent since 2008, while costs faced by tertiary education providers have risen 9 percent. The cost of tertiary fees paid by students since 2008 has increased by 37 percent.
3 News / NZN