A university boss says the real solution to the sector's financial woes is to allow international students into the country.
The Government is proposing to scrap the Education Export Levy payment to ease the financial burden caused by the loss of foreign students.
But Victoria University vice-chancellor Grant Guilford says removing the levy only helps universities a little - about $600,000.
"The counter to that is we're taking a loss of $30 to $40 million," he told Newshub. "So it's a very positive gesture by the minister - I just hope that he's got another plan."
Guilford said tertiary providers don't want to take taxpayers' money.
"We're best off left to our own devices to earn that money offshore. The only way we can do that is reopen the border under a quarantine mechanism that keeps the New Zealand public safe."
Education Minister Chris Hipkins said removing the levy is just one part of the Government's efforts to help secondary and tertiary education providers get through the COVID-19 recession.
"I also intend to temporarily allow schools to offer distance learning, including NCEA, to students based off-shore who have enrolled with the school during 2020, on a case-by-case basis," he said on Friday.
"COVID-19 has had a significant impact on our education sector and revealed some of the practical limitations of our current legislation. That's why I have proposed some further changes to respond to the sector's need to manage the disruptions and difficulties of the new COVID-19 environment."
The changes, listed on the Government's website, will be "tabled as Supplementary Order Papers when Parliament next considers the Education and Training Bill during the Committee of the Whole stage", Hipkins said.
AUT vice-chancellor Professor Derek McCormack told NZME they've had double the interest from potential international students, keen to come to New Zealand - just one of a handful of countries to have eliminated the virus.
Hipkins said it was unlikely the borders would open in the second semester of this year.
"But as soon as we can press the 'go' button, we will," he told NZME. "By the beginning of next year, I would like to have arrangements in place where we could have a more significant number of international students coming in."
New Zealand Initiative chief economist Eric Crampton last month said allowing international students into the country was a "pretty obvious move" and worth potentially $1.5 billion.
"New Zealand's COVID-free status means international education for the universities, the tertiary sector and even secondary schools - it isn't just a 'get back to where we were' scenario... we've got a real ability to grow here," Crampton told The AM Show.
Dr Crampton said universities would easily be able to fund the two-week quarantine period, with each bringing in about $24,000 in fees each year.
Most of Victoria University's international students come from China and Vietnam, RNZ reports, both of which have largely defeated the virus. But it also has many from the US, which has the highest number of cases in the world.
The National Party has also called for students to be let back in.
"New Zealand competes with Australia and Canada for international students so we need to be timely in reassuring offshore students they can study in New Zealand, and enable local education providers to plan and return to business," spokesperson Shane Reti said in May.
Deputy leader Nikki Kaye this week international students shouldn't be allowed to work here however, to keep jobs open for Kiwis.
"Exemptions have already been given to border restrictions on economic grounds for things like the Avatar film crew," a policy statement from the party said. "International education is far more important to the New Zealand economy, and supports far more jobs than the film industry."
