Back in May, thousands of students were left in limbo as one of the biggest vocational educational training (VET) providers, Careers Australia, went into administration after losing government accreditation and funding. From the Jakarta Globe:
Careers Australia Group, a provider of vocational education and training, has gone into voluntary administration after losing government funding, putting 1,100 people out of work and 15,000 students in limbo, its administrators said on Friday (26/05).
All work placements for students, many of them from overseas, will be suspended immediately as will all school-based apprenticeships and traineeships…
The collapse of Careers Australia, which has 14 campuses, comes as the government reviews the way funding is distributed to the sector.
The Department of Education and Training said the firm had notified Careers Australia on Wednesday that it will not accredit the company for a new vocational education scheme.
“Careers Australia did not meet three of the provider criteria: financial performance, management and governance and student outcomes,” it said, adding that the government may provide financial assistance to affected students.
The collapse of Careers Australia follows the similar fate experienced by Australian Institute of Professional Education – another large private VET provider – in October last year, which also left thousands of students in limbo.
Last night, ABC’s 7.30 Report ran a segment on how Careers Australia continued to target a new set of potential students – and a new source of government money – even while its operations were under scrutiny by the Turnbull Government, with former senior Coalition MP, Andrew Robb, named as a chairman:
LEIGH SALES, PRESENTER: Thousands of students are in limbo after paying a lot of money and studying for years for qualifications that are now up in the air.
Careers Australia has given hundreds of millions of dollars in taxpayer funding for courses that were often sold in vulnerable neighbourhoods using inducements such as free laptops, but the education giant went bust last month, blaming its demise on being unfairly targeted during a crackdown by the Turnbull Government.
Tonight, 7.30 can reveal that even while the private college sector was under scrutiny, Careers Australia was setting its sights on a fresh set of students…
MICHAEL ATKIN: Careers Australia’s private education empire of 15 campuses in five states was built with taxpayer funding.
In just two years, it raked in $415 million from Federal Government student loans.
ROD CAMM, COUNCIL FOR PRIVATE EDUCATION AND TRAINING: The focus on high enrollments, regardless of the outcome and that has caused damaging and devastating impacts to students and our industry.
MICHAEL ATKIN: A series of 7.30 investigations revealed how Careers Australia was achieving such rapid growth.
First, the company was using door-to-door sales brokers who targeted poor communities, offering free laptops… Then it switched tactics, using large call centres to recruit job seekers or people who entered online competitions…
In October, the Turnbull Government hit back, cracking down on its main source of income – vocational education…
With the crackdown underway, Careers Australia didn’t stop. Instead, insiders have told 7.30 here at the Brisbane headquarters, it hatched a new plan, this time to target higher education students…
Careers Australia injected $17 million into the Australian School of Management, including for this splashy marketing campaign…
In January, Michael Moxon received a phone call after applying for a sales management job online. The caller was recruiting students for the Australian School of Management and Michael signed up.
MICHAEL MOXON, FMR STUDENT, AUSTRALIAN SCHOOL OF MANAGEMENT: It was all about me getting a better job and they were playing the card of being this very helpful person, that all their intention is to get me a better job.
MICHAEL ATKIN: In March, alarm bells started ringing inside the tertiary education watchdog when ASM said it wanted to enrol almost 9,000 new students.
If it went ahead, the cost to the taxpayer in student loans would be astronomical – $87 million.
ANTHONY MCCLARAN, TERTIARY EDUCATION QUALITY AND STANDARDS AGENCY: We were looking at potentially very, very rapid, unprecedentedly large growth of student numbers.
MICHAEL ATKIN: The watchdog froze new enrolments while it investigated, discovering some new students were really job-seekers, and ASM had been selling unaccredited courses.
ANTHONY MCCLARAN: The standards were clearly either under direct threat or potentially being threatened and that means that there were risks for students and for the reputation of Australian higher education…
MICHAEL ATKIN: 7.30 can now reveal Careers Australia was using rogue education broker Acquire Learning to target students…Acquire was being prosecuted by the Australian Competition and Consumer Commission for misleading and deceptive sales tactics, but even that didn’t stop Careers Australia paying Acquire to turn job-seekers into new students.
ROD CAMM: Pretty much wherever I go in this industry, colleges talk about the predatory practices of Acquire Learning…
MICHAEL ATKIN: The chairman of the Australian School of Management is former senior Turnbull Government Minister, Andrew Robb. He declined to be interviewed by 7.30, saying we should instead speak to CEO David Ensor who did not respond.
I’m shocked that Australia’s most upstanding former politician, Andrew Robb, is involved in this swindle.
More broadly, the widespread rorting of the private VET sector is yet another example of the failure of demand-driven training systems across Australia. They were supposed to give students greater choice and make providers more responsive to students and employers. But instead, Australia produced a wasteful, rorted system that has delivered a huge Budget blow-out and poor educational outcomes.
