Australia withholds USP funding over financial mismanagement investigation

The Australian government has confirmed it has withheld funding from the South Pacific’s leading university, following an investigation into financial mismanagement at the institution.

An independent investigation into the University of the South Pacific this year found the exploitation of allowances and bonuses for some senior staff had cost the institution a significant amount of money over several years.

During an appearance before the Fijian parliament’s standing committee on social affairs last month USP’s Vice-Chancellor Professor Pal Ahluwalia revealed the Australian government had not provided its annual funding of $14 million.

He told the committee Australia only provided $3.5 million at the start of the year.

The Australian government is the university’s largest donor and in January during a visit to Fiji Prime Minister Scott Morrison announced a new funding partnership worth $84 million over six years.

In a statement, Australia’s Department of Foreign Affairs and Trade said it and USP had jointly agreed to modify the schedule of payments to support reform actions by the university.

DFAT said a tranche of $3.5 million was released last month after the university appointed an independent commission to implement the investigation’s recommendations.

It said funding should return to normal in the in the first half of next year.

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