Scyne to send 78 staff back to PwC amid moves to delay graduate starts

PwC will stand down 78 staff who have been returned to the firm from its government consulting spin-off Scyne Advisory, amid moves to delay graduate starts and distributions to partners.

PwC will stand down 78 staff who have been returned to the firm from its government consulting spin-off Scyne Advisory, amid moves to delay graduate starts and distributions to partners.

In a note to partners on Thursday, PwC said it was delaying the payment of the balance of income to November, punting the remaining 20 per cent of partner distributions from an expected October payday.

This came amid PwC’s continued delays in offloading its government consulting business to Allegro Funds.

PwC chief executive Kevin Burrowes told partners the deal was expected to be complete shortly.

“Waiting to make the payments until after the deal officially closes is the most prudent course of action for our firm,” he said.

This came as Scyne told 78 staff they would be handed back to PwC amid delays in securing new work as state governments continue to hold off signing on Scyne Advisory to new contracts amid delays in securing approvals from the Foreign Investment Review Board.

PwC has told the 78 staff they would be stood down on paid leave amid uncertainty about their future.

At issue are contracts with the Victorian, NSW, and Queensland state governments, which are holding off pending a decision from FIRB.

In a note to staff, PwC chief executive Kevin Burrowes said the firm was “working with these individuals” returned by Scyne “to determine what this means for their employment at PwC”.

“During this time our people are being offered approved paid leave and encouraged to take a look at our internal jobs board,” he said.

“This is an especially challenging time for our people who are directly affected.”

Mr Burrowes also revealed PwC was considering paying its graduate consultant cohort $10,000 to delay their start dates by as much as 12 months as the consulting arm of the firm faces issues.

Mr Burrowes noted this “news may cause anxiety and uncertainty for some of our people”, but told staff the firm would not delay its intake of 2024 graduates.

PwC will take on 388 graduates in its assurance and financial advisory business.

The move to punt the 78 staff takes the total headcount at Scyne Advisory towards 1400, down from initial estimates of almost 1500 PwC staff making the jump to the new business.

The move is expected to be particularly acute in Adelaide, where Scyne Advisory was to base its skilled services hub in a mirror of PWC’s existing model.

Almost 38 staff from the Adelaide office are expected to be affected by the move.

A Scyne Advisory spokesman said delays in the transaction, originally expected to be completed by September 30, had led to the need to send staff back to PwC.

He said the change in the partner mix and “the need to establish Scyne as a sustainable business” required “returning to PwC rather than joining Scyne Advisory”.

“This means there will be around 1400 people join Scyne when we are established following the final approval federal regulatory approval. We expect that approval imminently,” he said.

Scyne Advisory is still awaiting sign off from FIRB over the deal that saw PwC sell its government consulting operation to distressed debt asset managers Allegro Funds for $1.

Treasury has already agreed Scyne Advisory could tender for Commonwealth public service contracts, after issuing a note two weeks ago.

Scyne Advisory said public servants could consider Scyne Advisory for jobs, as well as the rollover of existing PwC contracts held by the firm’s government consulting business.

But a decision is still pending as to whether Scyne Advisory will be allowed to take over PwC’s spot on the Management Advisory Services Head Agreements, which could open doors to more work for the firm.