Financing for equity in higher education
1. Education resources to subnational governments
2. Education resources to institutions
3. Education resources to students
4. Support for students' living costs
Introduction
Key financing indicators (UIS Data)
The gross enrolment ratio for tertiary education for both sexes was 76.38 in 2023. The initial government funding per tertiary student as a percentage of GDP per capita was 24.60 in 2023. The initial household funding per tertiary student as a percentage of GDP per capita was 4.33 in 2023.
Tuition-free status
Public tertiary education in New Zealand is not generally tuition-free according to national laws and policies. The Education and Training Act 2020 provides the legal framework for tertiary education fees. Under this Act, the Minister for Universities may regulate tertiary education fees. In practice, these regulations have limited the amount by which providers may increase fees each year, and have stipulated that foundation tertiary education, i.e. school-level qualifications, is provided fees free.
One year of fees-free study has been offered since 1 January 2018 to learners with little or no prior tertiary study, at the New Zealand Qualifications and Credentials Framework (NZQCF) Level 3 and above. Until 2025, this policy covered students’ first year of study. Since then, it has applied to the final year of students’ qualifications.
Governance
In New Zealand, the financing and oversight of higher education are shared across several government entities, as outlined by the Education and Training Act 2020. Vote Tertiary Education is the formal budget allocation from the New Zealand government specifically designated for tertiary education expenditure, other than financial support to students.
Vote Tertiary Education is administered by the Ministry of Education, which is the responsible department, with funding distributed and managed primarily through the Tertiary Education Commission (TEC). Ministerial responsibility for tertiary education is divided across the Minister for Universities, the Minister for Vocational Education, and the Minister of Education, each holding specific appropriations and oversight roles within Vote Tertiary Education.
Student Loans and Allowances are administered by the Ministry of Social Development through Vote Social Development, with the repayment of student loans administered by Inland Revenue through Vote Revenue.
Strategic direction for funding and priorities is set through the Tertiary Education Strategy, issued by the Minister for Universities and the Minister for Vocational Education, ensuring that government-funded tertiary organisations remain accountable to government priorities and public investment objectives.
1. Education resources to subnational governments
Publicly-funded tertiary education in New Zealand is the responsibility of central government.
New Zealand's tertiary sector comprises eight universities, polytechnics and institutes of technology (of which 10 are currently stand-alone, as the Government shifts away from a centralized model), and three wānanga (Māori universities These provider types are defined as Crown entities established under the Crown Entities Act 2004. The sector also includes around 300 private training establishments, many of which receive government funding, eight Industry Skills Boards, and a small number of other organizations.
2. Education resources to institutions
Funding for private universities in the absence of public institutions
All universities in New Zealand are publicly owned. Some registered Private Training Establishments (PTEs) offer degree-level qualifications, and are eligible for funding from the Tertiary Education Commission (TEC). The TEC explicitly considers geographic access, regional gaps, and the overall “network of provision” when allocating funding; with the 2026 Plan Guidance stating explicitly that the commission will “make decisions to maintain and shape an appropriate network of provision across higher, vocational and foundation education,” and will consider how a private institution “responds to regional needs and gaps across the network of education and training provision on offer across New Zealand.” PTEs must also demonstrate quality, financial viability, and alignment with the Tertiary Education Strategy to receive public funding.
Allocation and equity
Government subsidies to public higher education institutions in New Zealand are allocated primarily through formula-based funding mechanisms administered by the Tertiary Education Commission. Funding is calculated based on the number of Equivalent Full-Time Students (EFTS) enrolled, with per-EFTS rates that vary substantially by qualification level, subject area, and delivery mode. High-cost subjects such as medicine, veterinary science, and engineering receive higher per-EFTS funding rates than general degree programmes. Additionally, some funding is allocated to institutions that undertake research – mostly universities – based on research quality evaluations, research degree completions, and external research income.
Under Section 419 of the Education and Training Act 2020, the Minister for Universities and the Minister for Vocational Education determine the design of the funding mechanisms that TEC uses to fund organisations, including the allocation of equity funding to target participation and achievement among specific underserved groups. Per the 2025 equity funding mechanism, Māori and Pacific learners at degree level and above (Levels 7–10) receive additional equity funding of NZD 364 per EFTS at Level 7 and NZD 506 per EFTS at Levels 8 and above, while TEIs at foundation or degree levels receive NZD 32.52 per funded EFTS to support disabled learners’ participation and achivement.
The Tertiary Education Strategy 2025-2030, released in December 2025, marked a shift from equity-oriented priorities toward a stronger focus on economic growth. From 2027, while funding decisions will continue to consider equity outcomes for disadvantaged students, there is a greater focus on demonstrated alignment with labor market needs and strengthened research-industry partnerships.
3. Education resources to students
Admission for vulnerable groups
At the national level, there are no specific admission criteria for vulnerable groups. However, higher education institutions may operate targeted admission schemes that facilitate access for vulnerable groups. For example, the University of Auckland's Undergraduate Targeted Admission Schemes (UTAS) provide preferential admission to undergraduate programmes for applicants who have not met the guaranteed entry score for their chosen programme. Eligible applicants include students who are of Māori or Pacific descent, have a disability, or are from low socioeconomic status or refugee backgrounds. Additionally, the Māori and Pacific Admission Scheme (MAPAS), operating since 1972 at the University of Auckland Faculty of Medical and Health Sciences, reserves approximately 40 percent of domestic medical school places annually for applicants with verified Māori or Pacific ancestry. Only students who meet the academic requirements are accepted. In 2025, 18 percent of total enrolments were through this pathway.
Scholarships, grants and loans for vulnerable groups
The Ministry of Education administers the largest government-funded scholarship programmes targeting vulnerable groups through TeachNZ, which provides scholarships exclusively for students training to teach. Teach NZ awards include five specific scholarships, several of which reserve places for Māori and Pacific students. These include the Te Huarau Scholarship, which offers preferential consideration for Māori, Pacific, and students planning to teach in bilingual or immersion settings; and the Kupe Scholarship for Māori and Pacific High Achievers, which is exclusively available to students of Māori or Pacific descent pursuing initial teacher training with demonstrated cultural knowledge, integrity, and leadership.
Beyond the TeachNZ schemes, the Ministry of Education and Ministry for Pacific Peoples administer scholarships targeting Pacific and Māori students more broadly, including the Ministry of Education’s Tulī Takes Flight Scholarship for Pacific students who have completed one year of tertiary education and the Ministry for Pacific Peoples’ Toloa Scholarships for Pacific students in STEAM subjects who have completed one year of tertiary education. The government also provides limited merit-based scholarships through the New Zealand Scholarship and the Top Scholar Awards, administered by the New Zealand Qualifications Authority.
The Student Loan Scheme Act 2011 governs student loans for tertiary education in New Zealand. Student loans are available to eligible students for course fees, course-related costs, and living costs. Eligibility criteria are universal and do not provide preferential access or terms for vulnerable groups.
The Student Allowances Scheme, administered by the Ministry of Social Development, is a means-tested grant to help people from low-income backgrounds access tertiary education. In most cases recipients must be aged between 18-65, and studying full-time. Eligibility is income-dependent, which includes parents' income for those younger than 24 with no children, or partner's income for those over 24 or who have a child.
The Ministry of Social Development operates the Training Incentive Allowance (TIA), a non-repayable grant administered specifically to target vulnerable populations pursuing tertiary education or approved vocational training at Levels 1-7 of the New Zealand Qualifications and Credentials Framework. Eligible groups include sole parents receiving eligible benefits, disabled people receiving Supported Living Payment, and carers of disabled people receiving Supported Living Payment. The TIA provides funds to cover tuition fees, transport costs, childcare, care support, and books or course materials.
4. Support for students’ living costs
Transportation
No government transport subsidy is available to all tertiary students across New Zealand; transportation support varies by region and is provided through multiple mechanisms. The Youth Guarantee programme, administered by the Tertiary Education Commission, includes a travel assistance subsidy that funds student transport costs for young people aged 16-24 studying at Levels 1-3. In Auckland, full-time tertiary students at universities and polytechnics are eligible for a concession discount on public transport. Outside Auckland, the national intercity bus operator InterCity offers discounted student fares on selected services for students with approved identification. The Training Incentive Allowance, available to sole parents, carers, and disabled people on specific benefits, can be used to cover transport costs associated with approved course study.
Accommodation
The Accommodation Benefit, administered through StudyLink, provides a weekly payment to students receiving a Student Allowance who do not live with parents and meet eligibility criteria. Entitlements depend on location and number of dependents with a maximum entitlement of NZD 305 per week.
Textbooks
Support for textbooks and course materials among tertiary students in New Zealand is limited. The Student Loan scheme permits borrowing of up to approximately NZD 1,000 per year for course-related costs, including textbooks, stationery, and computer equipment, though the borrower must repay the loan. The Training Incentive Allowance, available to sole parents, carers, and disabled people on specific benefits, explicitly permits use of funds to purchase books and course materials as part of their maximum allowance for study costs.
This profile was reviewed by Isabel Warden, Policy Analyst, and Alasdair Saunders, Principal Policy Analyst, of the Ministry of Education of New Zealand.
