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Big blow to IDP - loses lucrative Botswana contract

THE Botswana Government will sever links with IDP Education Australia in a body blow to the universities' troubled international marketing and recruitment arm.

After weeks of speculation that one of IDP's most lucrative contracts was under threat, the company yesterday confirmed that at the end of March the Botswana Government would not renew it.

The Botswana High Commission will take over the $19million student fellowship scheme under which 500 of its students are placed and supported in Australian universities.

A Botswana Ministry of Education spokesman said yesterday his government had had a good working relationship with IDP for more than 10 years. But it would now use itsown officers to administer students abroad.

It began taking over the management of its students in December. The latest move will complete that process.

Botswana pays IDP about $6million every three months under the fellowship scheme.

While the biggest slice of that is passed on to Australian universities for tuition fees and other allowances, IDP retains about $1.5 million a year in management fees.

From the end of March that $6 million will pass directly from the Botswana Government to Australian universities, with the Botswana High Commission managing the program instead of IDP.

It comes at a crucial time for IDP as it pares back its operations and turns to its core business of student recruitment in Asia.

Late last year its critical cash-flow problems triggered the closure of seven overseas offices and 60 staff redundancies. A steady stream of resignations continues to exacerbate the not-for-profit company's woes.

The group blames its crisis on a drop in international student numbers due to external factors beyond its control.

Three days before Christmas universities mounted a rescue bid, pledging $7 million in interest-free loans over two years.

At the same time $6 million in fees from the Botswana contract came to IDP, giving it a temporary reprieve.

IDP president and vice-chancellor of Curtin University of Technology Lance Twomey said then that if the Botswana contract had not come through "IDP would have found it difficult to meet commitments".

Professor Twomey refused to discuss the Botswana contract with the HES after a board meeting on Monday.

In a statement issued yesterday he said: "While students from Botswana were a sizeable segment of IDP's fellowship management in the past, student numbers from other countries have increased, particularly in the Middle East, where IDP has contracts with government and private companies."

In the same statement chief executive Lindy Hyam said: "It has been a privilege to be part of this contract, with IDPand Australian institutions contributing to the human resource development of Botswana."

No one at IDP would speak to the HES about the developments yesterday.

Reported in The Australian
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