Backpacking and English language schools – a match made in heaven or hell?

News that all GEOS English language schools in Australia have closed with debts in excess of A$10 million comes at an unfortunate time for backpacking, which has recently started cosying up to an industry which brought 160,000 young people to Australia in 2008.  

The two industries certainly seem to have lots in common. They both cater for young people looking to broaden their experience through study, work and travel overseas. They both rely on agents in source markets to attract customers, often paying high commissions to keep them away from competitors. And they both employ staff on casual contracts and low wages, making them easy to get rid of when times are tough.

Looking at GEOS in Australia, it’s easy to conclude they also both have members capable of bringing bad publicity crashing down on everyone else’s heads.

According to The Age, the Victorian Registration and Qualifications Authority had recently become concerned about GEOS following a financial audit, with allegations directors had been diverting revenue from its Melbourne school to support operations elsewhere in Australia and overseas.

Meanwhile, in a statement following the collapse, administrators Ernst and Young said: “The financial situation of the companies is such that the schools are not able to be re-opened. We are continuing to investigate the financial affairs of the companies and will report to key stakeholders in due course.”

With students and staff owed more than A$10 million, they are certainly entitled to ask where all their money went.

Fortunately, GEOS was a member of peak industry body English Australia, which will be working hard to ensure all its students are placed elsewhere.

But despite EA’s best efforts, this will play incredibly badly overseas, where prospective students are still digesting news of the collapse of Chinese-owned vocational college group Meridian in November 2009, which left more than 3000 students in Melbourne and Sydney stranded.

Following the recent bad publicity in India over student bashings, the seemingly unstoppable rise of international student numbers into Australia might soon become a thing of the past.

4 thoughts on “Backpacking and English language schools – a match made in heaven or hell?

  • March 24, 2010 at 7:57 pm

    There’s no shortage of rules and regulations for education providers focusing on the international student market. What the industry has always lacked in the 12 years I’ve been involved with it is enforcement of the rules. There will be a ‘clean out’ and it will be a good thing. Exchange rates and the GFC have also had an impact.

    The massive increase in numbers was predominantly in the vocational sector with the main attraction being permanent residency, not travel.

    Numbers will decrease however even a 10-20% decrease from 1/2 million is still a big number worthwhile knowing about.

    Australia’s international education sector is bigger than this setback and will continue to underpin Australia’s tourism industry.

  • March 24, 2010 at 8:40 pm

    Bretts back!

    Underpin? It underpins the education sector not the tourism industry. Unless of course you can tell me how to get international students on our buses, sailing trips, surf lessons, outback trips, and need I go on?

    They’re even a little low budget for the BP industry.

  • March 29, 2010 at 7:29 pm

    They are on your buses, Greg. As we converse, these sneaky fellas are also learning about bunk beds, breaking down in campervans, eating starchy free meals, getting rescued by surf instructors and wondering why people call them backpackers. And I thought you’d finally understood….(sigh)…..

  • March 30, 2010 at 7:52 am

    Damn it! I wondered why we had so many cooks and hairdressers on our buses. It’s those cashed-up international students.


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