John Dawkins: Former education minister, treasurer faces court over Vocation collapse
Updated
Former federal education minister and treasurer John Dawkins is facing legal action over his role in the collapse of private education provider Vocation.
Key points:
- ASIC understood to be pursuing John Dawkins with civil charges of misleading conduct
- Vocation alleged to have failed to disclose full potential of withdrawal of Vic Govt funding
- Company still owes $8 million to Victorian Government
The Australian Securities and Investments Commission (ASIC) is pursuing the former chairman of the company with civil charges of "misleading and deceptive conduct".
The accusations relate to an alleged failure by the company to fully disclose the full potential of a withdrawal of Victorian government funding to Vocation in the lead up to a $72.5 million capital raising in September 2014.
"I was one of four non-executive directors — although I am only one part of this action — and I believe we all diligently and collectively fulfilled our disclosure obligations," Mr Dawkins wrote in a statement through public relations firm GRA Cosway, of which he is chairman.
"ASIC's proceedings will be vigorously defended."
Around 80 per cent of Vocation's revenue came from state and federal government funding.
At its peak, Vocation had a market capitalisation of $700 million, before its collapse in November 2015, which left up to 15,000 students in limbo and investors and creditors significantly out of pocket.
The Victorian Government is one of the biggest creditors, with $8 million owing.
The company had many brands including Avana, Buildit Learning and Real Institute providing training to corporate and government clients.
Federal Government considers funding shake-up
The legal action comes as the Federal Government considers a shake-down of vocational education providers after revelations some have left thousands of would-be students heavily in debt and without useful qualifications.
The Australian Competition and Consumer Commission is also investigating numerous operators.
Federal Education Minister Simon Birmingham has frozen payments to all private providers at 2015 levels and earlier this year released a discussion paper on redesigning the scheme.
Earlier this week, Mr Dawkins, the former Hawke government education minister, called for a massive overhaul of the tertiary education system, including fee deregulation.
He was reported to write a letter to Vicki Thomson, the head of the Group of Eight Universities, saying his own 1987 reforms were "out of date" and he praised Christopher Pyne's attempts at deregulating the sector.
Mr Dawkins has spoken out previously about the collapse of Vocation, reportedly telling a conference of the Australian Council of Private Education and Training that when floating a company, it is wise not to bet on government money.
"When readying the business for sale it's best to ensure that revenue from government is not nominated," he said.
Topics: business-economics-and-finance, vocational, education, education-industry, government-and-politics, university-and-further-education, law-crime-and-justice, australia, vic
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