Polytechnics have returned their worst financial results in years and there is no respite in sight for the 18 institutions, Radio New Zealand reports.
Newly released figures show enrolments are falling as the economy improves, and next year will be their fourth in a row without increases to their government funding.
The 18 institutes of technology and polytechnics, known as ITPs, have just finished reporting their 2013 financial results and all but one have worse results than in 2012.
As well, 12 failed to make the 3 percent surplus required by the Government and three of those -Weltec in Wellington, Whitireia in Porirua, and Aoraki in Timaru - had deficits.
Tertiary Education Union president Lesley Francey said the institutions were in a bad way.
"There is absolutely no fat in the system," she said.