The controversial dean of the Victorian College of the Arts and Music, Sharman Pretty, could face conflict of interest concerns after she hired a firm she directs to review the institution’s Indigenous centre.

Crikey can reveal that arts entrepreneur Justin Macdonnell, the executive director of the Anzarts Institute, was drafted in by Pretty to size-up the storied Wilin Centre for Indigenous Arts & Cultural Development after its funding dried up last year. Pretty serves on the board of Anzarts alongside other arts luminaries including singer Robin Archer and dance critic Lee Christofis.

The Wilin Centre (Wilin means “fire” in the language of the traditional land owners) occupies pride of place on the VCAM’s Southbank campus and boasts of unique achievements including a higher Indigenous retention rate than any other tertiary institution. Established in 2002, it recently exhausted its seven-year funding grant from an anonymous foundation worth hundreds of thousands of dollars, forcing VCAM and its parent, the University of Melbourne, to examine its future.

Macdonnell, who is not Indigenous, was holding workshops this morning on the centre’s future, believed to be paid for by the foundation. The centre currently employs three full-time staff, although Crikey understands that quota will be cut to two on Monday after one contract wasn’t renewed. There are fears the Macdonnell review could entrench the new status quo.

One senior arts industry source, who did not want to be named, was scathing when contacted by Crikey.

“There are hundreds of arts consultants out there. Sharman could have easily employed anyone to do the review. But she seems to have used her own organisation instead.

“The review is a good thing, but it’s the perception of the conflict that’s the problem.”

Macdonnell has called for a radical shake-up in how arts organisations are run, branding traditional governance models a “miserable failure”. He established Anzarts in early 2008 after returning from South America, and immediately drafted Pretty onto the board. The Anzarts website, in its news section, congratulates Pretty over her appointment as Dean of VCAM.

In an emailed response, a University spokesperson told Crikey that there was “no review” of the Wilin Centre.

“That implies something which is backward looking. Mr Macdonnell has been appointed to carry out a forward looking planning process to inform a strategy for the best way forward for the Wilin Centre.

“Mr Macdonell is a seasoned arts consultant with considerable experience in advising Indigenous arts organisations.”

The University also dismissed conflict-of-interest concerns, arguing Pretty received no financial inducements from Anzarts. The payment to Macdonnell was “confidential contractual information”, according to the spokesperson.

Crikey also contacted Macdonnell, who did not get back before deadline.

The latest controversy will increase pressure on Pretty after it was announced last week that a review panel overseeing controversial changes to VCAM comprised only two elected appointments. Four existing VCAM school heads are on the panel, including Professor Kristy Edmunds, a vocal defender of the university over curriculum and funding shortfalls that have led to mass protests and uproar in state parliament.