The coalition Government has confirmed it will scrap New Zealand's fees-free university scheme following an impromptu "Budget leak" by New Zealand First leader Winston Peters. Finance Minister Nicola Willis confirmed that this year will be the final one in which students completing their studies can access the fees-free support, which currently provides up to $12,000 in tuition fees.

The scheme was originally introduced by the previous Labour government to cover the first year of study or first two years of work-based learning. After taking power, the coalition revised the policy to instead cover students' final year of tertiary education. Peters indicated the Government plans to "reshape and repurpose" the funding toward trades and industries where it believes there will be better returns on investment at lower cost.

The decision represents a significant shift in tertiary education policy that will directly impact student finances and debt levels. While Willis stated the Government will provide more details in due course, the immediate effect will be increased financial barriers for future university students who would have otherwise benefited from the fees-free final year of study.