I have always firmly believed there is nothing new in this world. Take this recent quote:

“For too long and too often, the private education industry has been characterized by inadequate student outcomes, overly aggressive marketing practices, and poor compliance. This doesn’t need to be the case.”

Sounds like a pronouncement from the Australian Department of Education and Training, but no – and the spelling might give this away – it is a quote from a former Deputy Secretary of the US Department of Education who is about to take the helm at Apollo Education Group (owner of the University of Phoenix).

Here are some of the current goings on in the for-profit higher education sector in the US that sparked the above quote:

  • DeVry University is currently being sued for deception for misleading students about their chances of getting a job and increasing their income after graduation.
  • The University of Phoenix is facing a probe regarding deceptive marketing practices and has been accused of aggressively recruiting specific demographics of prospective students.
  • The second largest for-profit college in the US has been ordered to pay back US$103M worth of student loan debt to settle claims that it violated consumer protection laws.

The US has tried to rein in these aggressive marketing practices by holding colleges responsible for preparing their students for “gainful employment”, a clear outcomes measured approach to government loan support.

What has the American experience got to do with Australia? Anyone involved in the Australian tertiary education sector would recognise the stark similarities between the American experience and the recent Australian experience, notably some RTOs being prosecuted by the ACCC for deceptive marketing and others being asked to pay back millions in government funding (particularly in Victoria).

In my last blog, “Who killed the goose that laid the golden egg”, I lamented the fact that these same protagonists are already involved in, or seeking to enter the higher education space. Reflecting on the current American experience we must remain vigilant at all levels, i.e. government, professional associations and individual HEPs, to ensure that sharp marketing practice does not infect our sector.

If the American experience is anything to go by the repercussions are clear; capping of FEE-HELP assistance, tying continued approval as a provider of FEE-HELP assistance to student outcomes, further prosecutions by the ACCC, and a general loss of reputation.

But worse than all this – losing faith with our students.

Dr Peter Ryan

Founder & CEO, Higher Education Leadership Institute