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His comments come after Labour's tertiary education spokeswoman Maryan Street this week said Mr Joyce should ''hang his head in shame'' because of the dismal performance of New Zealand polytechnics.
Otago Polytechnic had in recent years largely bucked a wider trend in the sector by boosting student numbers and running healthy surpluses, but Mr Ker said the funding environment would make this more difficult in future years.
''Every year it gets harder to both deliver a high quality of education and make the investments in technology and facilities to stay ahead.
''The sector is underfunded, and I think undervalued, as a whole,'' Mr Ker said.
Tertiary Education Commission data showed it was one of only two polytechnics to receive an increase in Government funding over the past four years - albeit at a rate below inflation.
Tertiary Education Minister Steven Joyce yesterday congratulated the polytechnic for its performance.
''I think they have got a good operation there; they know what their region needs [and] they are quite entrepreneurial in their approach,'' he said.
The polytechnic had also performed well when it came to attracting international students.
His statements backed up a letter he sent to Otago Polytechnic's council after receiving its 2013 annual report.
He disputed Ms Street's suggestion the Government was neglecting polytechnics.
The total surplus across the institutes of technology and polytechnic (ITP) sector was $31 million, which was 2.9% of turnover, he said.
While this was a decline on the previous year, this was to be expected due to declining student numbers, as more people returned to work following the recession.
Government funding was based on ''learner demand'' and if there was a decline in student numbers, there would be a decline in funding.
Ms Street earlier said the Government's funding model for polytechnics was ''unsustainable''.
''Our tertiary institutions are being asked to do more and more with less and less,'' she said.
Mr Ker said Ms Street had a ''valid point''.
''You can't pursue a sinking lid policy indefinitely and expect the same or better services.
''There has to come a point when polytechnics will be unable to continue to deliver the services the country requires.''
There had been no adjustments for inflation in several years, meaning each year it was ''expected to do more for less''.
It had bucked wider sector trends due to an increasing reputation as providing quality education and due to innovative focus - which included launching a bachelor of culinary arts degree and setting up Capable NZ, which was about assessing skills people gained in the workplace.
However, maintaining growth and planning for the future would be difficult as long as funding remained tight.