A major private university in the Chilean capital has been shut down by the government after it was found to have debts bordering on 4 billion pesos (£4.8 million).

The money owed by the Ibero-American University of Science and Technology (UNICIT), in Santiago, included 1 billion pesos in unpaid staff salaries, said Alejandra Contreras, head of the higher education division of Chile’s Ministry of Education.

UNICIT had been taken over by the state and put under investigation after the resignation of university rector, Félix Viveros Diaz, along with six board members, last March.

Giving a statement on the university’s closure, Ms Contreras said that the financial deficit of the institution had “strongly” affected academic activity, impacting on students’ ability to graduate.

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The majority of the university’s students are enrolled on medical courses, an area that is “complex to administer because it requires a clinical field [and] very specialised teachers”, she added. As a result, the university was dramatically understaffed and many students had been left without qualified teachers.

The relocation process of more than 2,500 students from UNICIT could take up to three years, it has been estimated, raising alarm bells among industry leaders. Enrolment for the upcoming university year is taking place this month.

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The closure will also come as a blow to Sebastián Piñera, the newly elected president of Chile, who has previously spoken in praise of private university and college providers, and is expected to expand privatisation of the sector during his term.

rachael.pells@timeshighereducation.com