The Australian government announced it is to stop subsidising university enrollments for most New Zealand citizens and Australian permanent residents from the start of next year.
Those students would be charged the same fees as international students, pushing the amount they would pay to study in Australia from about $7000 a year to more than $25,000 a year.
However, New Zealanders would get access to the Australian student loan system.
The massive increases to Australian university fees will prompt more New Zealand families to send their children back to New Zealand for tertiary education.
The changes would not apply to New Zealanders who had lived in Australia for more than 10 years and arrived as minors – they would continue to be eligible for domestic fees and Australian student loans.
Meanwhile, New Zealand Prime Minister Bill English said he was not happy about the change – but ruled out retaliating by stopping the New Zealand subsidies that allow Australians to study in New Zealand at domestic fee rates.
“We prefer to be in a situation where we have a positive relationship with Australia and Kiwis get a good deal in Australia. That’s better than a sort of mutual ‘arms war’ to see who can treat each other’s citizens worst,” Mr English said.