“Reports that one third of students benefiting from the Fees Free scheme failed to complete even one course confirms the scheme is the kind of waste New Zealand cannot afford in worsening economic conditions,” according to ACT Leader David Seymour.

“ACT has opposed the scheme consistently and these results are further vindication. Of course students will take free money, but taxpayers want results. As economic conditions worsen, New Zealand cannot afford low quality spending.

“Perhaps most damningly, the scheme has not helped improve equity, it has done the opposite. Poor education outcomes for Maori, Pacific, and students from low income households are one of New Zealand’s greatest problems, and fees free has, if anything, made it worse.

The Herald has reported Fees Free Students were 17 per cent Maori and nine per cent pacific, versus 21 and 12 per cent respectively.

“The Government has made much of its claim that fees free is not about rewarding university students, but encouraging study across a range of course levels. In reality, 53 per cent of fees free students were at a university, compared with 42 per cent of non-fees free students.

“It is a shame there is no data on what decile high schools the fees free students came from. Given they are more often European students attending university, it's statistically most likely that the students benefiting from fees free are those from higher decile high schools.

“Everything ACT has said about fees free is vindicated again by these new figures. Fees free is a transfer of cash to the students who were already ahead, that nonetheless devalues tertiary study by removing a price from it.

“ACT would scrap the scheme, and return to students making a contribution to their education, albeit borrowed through the student loan scheme on generous terms.

“ACT would use savings from reducing low quality spending such as this to introduce a 17.5 per cent flat rate of income and personal tax. Having the fairest, simplest, more competitive tax system in the world instead of low quality spending is the kind of preparation New Zealand needs for an economic downturn.