Tighter rules on government tertiary education subsidies are expected to be costly for a number of universities and polytechnics this year.
Enrolment numbers previously agreed with the Tertiary Education Commission are expected to fall short by more than 1% and the institutions will have to repay some of their funding.
Last year, repayments were required if enrolments were more than 3% below the agreed levels. This year the threshold is 1%.
The Government recovered $9 million from institutions that missed the threshold last year. Radio New Zealand's education correspondent says at least four institutions expect to miss the new target, and at least two others are still unsure.
Tertiary Education Minister, Steven Joyce told Morning Report the new repayment threshold will mean money not spent on teaching students is re-invested in the sector.
He said this forces tertiary institutions to accurately predict their student numbers and makes the system fair.