Some of the richest state schools say free education is a myth - and are demanding the right to charge parents compulsory fees to stay afloat.
State schools in wealthy areas say they are forced to seek millions of dollars from their communities but are prevented from making direct cash appeals to parents.
They want the Government to abandon what they say is the charade of free education - and let schools recoup massive shortfalls for essential resources such as computer equipment and library books through compulsory fees.
However, the Government says free education is enshrined in law and schools cannot charge for core activities, though they can withhold pupils' work if parents refuse to pay certain subject charges.
Some schools have called in debt collectors and Feilding High School refused to let 60 pupils into class this year because of unpaid fees.
Schools raised more than $500 million last year, Education Ministry figures show.
The decile funding system means schools with more pupils from low-income households receive a bigger share of state funding, while high-decile schools in rich areas get less.
Wellington College is a decile 10 school and headmaster Roger Moses said higher-decile schools now raised more than half their income from fees, international students and donations, but were censured by the Education Review Office if cash requests were not "voluntary".
"Let's just come out and say it - our education at the top level is not free, it's subsidised.
"Let's not pretend that education is free and that some schools are morally bereft by making requests of their communities."
The college charged a $535 annual fee for "extras" such as sports gear and computers, but was powerless to act against the quarter of parents who refused to pay.
Charging higher fees for international students had averted a financial crisis at many schools, Mr Moses said.
Auckland Grammar deputy headmaster Wayne Moore said only 65 per cent of parents paid.
The decile 10 school was introducing a $250 compulsory fee next year for technology subjects to help cover its significant shortfall and maintain standards.
Palmerston North Boys' High School rector Tim O'Connor said the decile 9 school was considering hiring a fulltime commercial manager to raise the extra $1.5 million a year it needed to operate: "We have parents who simply don't pay, believing that we have a totally free education system, which is generally supported by what the ministry tells parents.
"But we don't. Like New Zealand's clean and green - it's a bit of a myth really."
Education Minister Steve Maharey said free education was enshrined in the Education Act and there were no plans for compulsory fees.
Schools could request "donations" for extra-curricular activities and charge for subjects with practical components, such as woodwork.
Take-home work could be withheld if parents refused to pay but they had to be forewarned about any fee.
Mr Maharey said decile funding was a small component of school funding, which had increased from $3.9 billion in 2000 to $5.8 billion this year.
Locally raised funds were unchanged - about 10 per cent of school funding.
- The Dominion Post
What do the stars have in store for you today?
Test your mind with our puzzles
The Little Things, Dilbert, Tom Scott and others
Dig into New Zealand's archives
Decide what news you want to receive when it suits you
Keep up with the latest news by making us your homepage