Students defend Govt's fees-free policy

Students are hitting back at claims university dropouts will cost the taxpayer millions of dollars.

Figures revealed by Newshub on Thursday showed the cost of those who fail to complete their first year of fees-free study in 2018 will be $38 million.

The present tertiary education budget is about $4 billion, according to the Ministry of Education's Education Counts website.

The Government already covered more than 70 percent of the cost of tertiary education, and still does past the first year. Students who drop out or fail won't be required to pay back their share of the cost until the second year of free education is introduced in 2021, should Labour win the 2020 election.

ACT leader David Seymour slammed the policy, saying "tyre kickers" were signing up to university with no intention of completing a degree.

But NZ Union of Students' Associations president Jonathan Gee says it's misleading to say dropouts are wasting public money.

"Let's not forget that students are also taxpayers, so will obviously be paying back the fees-free in our lifetime when we start working," he told Newshub.

Mr Gee says while everyone might not end up with a degree, they'll still be upskilling.

"Even one year's worth of tertiary study, in my view, is beneficial to the students. They'll be exposed to a range of different people, their minds will be exposed to a range of different people, their minds will be open to different ideas. They'll be engaged in critical and creative thinking."

Prime Minister Jacinda Ardern said there were no plans to means-test the fees-free policy, saying the "whole point was making sure we extended the accessibility of our education system".

Prior to 1990, tertiary education was largely free. Since then, students have racked up more than $15 billion in debt. Around 64 percent of current borrowing goes on fees, NZME reported last year. Students studying for a bachelor's degree borrow almost $10,000 a year on average, including living and course-related costs.