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Otago Polytechnic is "disappointed" after a lack of Government funding meant it had to raise domestic fees by the maximum 4%, despite excellent enrolment figures and financial results, acting chief executive Mike Collins says.
The fee increases came as equivalent full-time student (efts) numbers at the end of August stood at 3478, 6% higher than the corresponding time last year.
International efts stood at 207, 20% up on the corresponding time last year. The polytechnic was also in a good financial position, with an operating surplus at the end of July of $2.845 million, which was $543,000 ahead of budget.
Despite this positive information, the polytechnic council "reluctantly" increased domestic fees for next year by the maximum allowable 4%.
The council approved a 4% increase for international fees, subject to courses remaining competitive within the sector.
Mr Collins said it was "frustrating" zero Government funding increases for most subjects taught at the polytechnic meant it had to raise fees.
"It is disappointing, because we are sending all the right messages around quality and financial viability, but ... there are policy factors [forcing us to raise fees]," he said.
The polytechnic's success in increasing student numbers could largely be put down to "brand reputation", he said.
"I think students are really starting to understand that they are work-ready when they graduate [from Otago Polytechnic]." The increase in international numbers was largely a result of "relationship-building" with overseas institutions.
This could be seen with the polytechnic's links with Shanghai, he said.
Minister for Tertiary Education Steven Joyce said funding was tight at present and while he accepted some increase in fees was possibly necessary, he questioned raising them by the maximum allowable amount.
"They should be looking a little bit more at what they can do to try and keep costs down for students and having a close look at their own operating costs, as the whole world is doing," Mr Joyce said.
The Government was "past the day where we put in more money every year for the same results" and was instead targeting areas such as engineering and science, he said.