ACT campaigns to make Student Services Fee voluntary, citing up to $4,000 in loan savings
The ACT Party will campaign on making the compulsory Student Services Fee voluntary, with tertiary education spokesperson Parmjeet Parmar announcing a policy that would require universities to offer student services as a menu from which students select and pay only for what they use.
Under the proposal, ACT would amend the regulations governing student services fees so that tertiary providers can no longer levy a blanket compulsory charge. Instead, students would choose which services they want and pay accordingly. Parmar said the party estimates students could save up to around $4,000 on their student loan over the course of a degree by opting out of services they do not use. RNZ
The Student Services Fee is separate from tuition fees and funds services including orientation events, student media, clubs and societies, childcare, sports facilities, and health services. At the University of Auckland, the fee in 2025 was $9.44 per point, working out to about $1,132.80 for a typical undergraduate. At Victoria University of Wellington it was $10.44 per point, or about $1,252.80 for the average student. The University of Auckland's 2026 fee remains $9.44 per point, unchanged from the previous year.
The Government regulates the process tertiary providers must follow to set the fee and determine what it is spent on, Education.govt.nz notes. Those regulations sit within the Tertiary Education Commission's funding mechanisms and are reflected in annual funding conditions, according to the TEC. ACT's proposal would work by amending those regulatory settings rather than abolishing the fee outright.
ACT argued that making the fee voluntary would lead to better-run services. If students can choose what they pay for, Parmar said, student unions or university services would need to improve their offering or scale back spending if they struggle to attract subscribers. The party frames this as a market discipline mechanism: services that students value would survive; those that do not would shrink.
The policy touches on a long-running tension in tertiary education funding. Compulsory student services levies have drawn political attention before. In 2011, then Education Minister Steven Joyce said many providers had made significant increases to compulsory levies on all students, Beehive records show. That round of reform tightened the rules around how the fee was set and what it could be spent on, but kept the levy compulsory. ACT's proposal goes further by removing the compulsion entirely.
What this means in practice is that the policy would shift the funding model for a wide range of campus services from a universal levy to a user-pays system. Student unions, which in many institutions rely on the compulsory fee for a substantial share of their operating revenue, would face direct financial pressure to demonstrate value to fee-paying students. Services like student media, advocacy, and clubs support — which may not have an obvious individual return for each student — could be among the hardest to sustain under an opt-in model.
The broader context here is ACT's long-standing ideological position on voluntary student association membership, which the party has advocated for across multiple election cycles. This policy extends that principle from membership fees to the wider student services levy. It sits within the coalition government's broader tertiary education agenda, though it is an ACT Party campaign position rather than a confirmed government policy.
The policy would also interact with the student loan system. Because the Student Services Fee is added to a student's loan, making it voluntary would reduce the amount borrowed — and ACT's $4,000 saving figure is predicated on students opting out of the fee across a full degree. Whether students would in fact opt out in large numbers, and what the downstream effect on service provision would be, are questions the policy does not yet address in detail.
Parmar's announcement did not include a timeline for implementation or specify whether the party would seek to advance the policy through coalition negotiations. The regulatory change would require amending the Tertiary Education Commission's funding mechanisms and associated funding conditions, a process that operates through Cabinet decision-making rather than primary legislation.
No tertiary providers or student associations have yet responded publicly to the announcement, based on the information available.
