Deregulation of university fees will hit regions like the Illawarra hardest, according to University of Wollongong Council member Michael Zelinsky.
Mr Zelinsky, UOW council's alumni representative, has labelled vice-chancellor Paul Wellings as "out of touch" with the people of the region for his support of fee deregulation.
In a column published this week in the Australian Financial Review, Professor Wellings supports the federal government's shake-up to university funding which was outlined in the budget.
Mr Zelinsky said that under the measures, to come into effect in 2016, graduates will have to repay their debts earlier, interest will be higher and some degrees will cost up to three times as much.
"I grew up in Wollongong and received a great education from the University of Wollongong and thought that the university reflected the proud working-class values of our city," he said.
"The vice-chancellor's ambitions represent a radical and dangerous policy shift with profound implications for families and young people in the Illawarra.
"[Professor] Wellings doesn't seem to understand it's only those from rich families who will feel confident to take on hundreds of thousands of dollars' worth of debt with high interest rates.
"To the average person the prospect of more than $100,000 to finance their education means they simply won't go to university.
"That's bad for those kids, it's bad for the Illawarra and it's bad for the economy."
Prof Wellings praised Federal Education Minister Christopher Pyne for giving "each university a chance to control the level of funding per student and to have greater ability to tune its own strategic direction independently of the government".
He noted that graduates with slow pay growth over their careers, or those not always in the workforce due to family and other commitments, would lose out.
Prof Wellings, former vice-chancellor at Lancaster University in the UK, said that much larger changes to university fees and repayments had been introduced in England in 2011.
"In England, despite the tripling of fees, student satisfaction with the quality of their courses remains high," he stated.
Mr Zelinsky said he was "staggered" by the comparison. "Wellings might argue that policies proving advantageous to the well-off worked well in his native UK but it's clear he doesn't understand our town, our community, our people.
"This is a regional uni in a working-class town that is already suffering with the decline in traditional industries - we should not be providing any more disincentive to training and re-training."
Mr Zelinsky is organising a summit on the issue next Thursday.