An Australian for-profit provider of vocational education and training (VET) targeted income of $100 million per month – $1.2 billion per year – and a profit margin of an outstanding 80%. This information was revealed last week in the public examinations in the Victorian Supreme Court into the collapse of Acquire Learning & Careers, a private for-profit VET provider which utilised the now closed VET FEE-HELP scheme.
According to an article in the Sydney Morning Herald, The court proceedings also revealed:
- A $900,00 salary paid to a person who chaired the company’s “Advisory Board”, but was not a Director of the company;
- An internal memo that “outlined a plan to turn Acquire into a college-owning behemoth with a $30 billion value to rival the likes of Telstra; and
- A “noisy call centre in Melbourne where pop music tunes were played to encourage sales staff to sell online diploma courses” to jobseekers.
Acquire Learning collapsed into administration in May 2017, owing $147 million and stranding tens of thousands of students. Prior to its collapse, the Australian Competition and Consumer Commission had fined the company $4.5 million for its sales tactics, “convincing vulnerable students to sign up for courses they were unlikely to complete.”
“The details of Acquire Learning’s ignominious collapse have been well-known for some time. However the current court proceedings are uncovering new and almost incredible abuses,” said Dr Don Perlgut, CEO of Community Colleges Australia.
“Acquire Learning was not alone in what they did. A number of for-profit VET colleges utilised the Commonwealth Government’s former VET FEE-HELP loans to enrich themselves. The efforts of well-meaning regulators were and are not enough in the face of a badly designed funding scheme combined with providers seeking to milk it. What is needed is a fundamental look at how the Australian VET sector has evolved. With more than 60% of all VET students – more than two and a half million last year – studying in a private for-profit institution, we have a severely unbalanced system,” said Dr Perlgut.
“CCA believes that making a profit out of education – and especially out of education funded by government – is inappropriate and against the best interests of the students, because there will always be pressures to reduce quality (of teaching, of student services, of hours delivered) and increase quantity of students, to obtain maximum profit. All of this means poorer training as a result,” said Dr Perlgut.