PwC partner admission intake paused as Senate considers list of 63 names involved in tax scandal

Disgraced professional services firm PwC has deferred its partner intake after handing over a list of names to a Senate committee.

PwC Australia has paused its partner admission process as the firm grapples with a crisis in Canberra over the firm’s use of confidential tax briefings to construct strategies allowing tech companies to dodge tax.

This comes as parliament considers what to do with a list of 63 names of current and former PwC staff involved in the sharing of the confidential briefings. Sources say large parts of the tax practice are likely to be caught up in the scandal.

PwC confirmed on Thursday it had deferred all current partner admissions “for the time being”, effectively stopping its mid-year intake.

“This is in no way a reflection on any of the individuals being considered, but rather a prudent decision in light of the current circumstances,” a PwC spokesman said.

“Our focus is on strengthening our business and rebuilding trust with our stakeholders.”

The move to defer appointments cruels the chances of aspirational staff landing a coveted partner role in the firm and comes in the wake of PwC’s rival EY announcing its mid-year intakes.

EY announced last week 82 new partners had joined its Australian business, taking total numbers across that firm to 756.

KPMG and Deloitte will announce their new partner appointments in coming weeks.

PwC said it had appointed 96 partners in the year to date.

In January this year PwC announced a further 67 partners had joined the firm, taking total numbers to 937.

Peter Collins shared confidential tax information from briefings with Treasury.

PwC’s move to pause appointments comes just a day after the firm handed over a list of 63 names to a parliamentary inquiry into the use of consultants in government, which has been demanding the firm reveal which of its staff dealt with confidential ­information.

Parliament took aim at PwC after it was revealed the firm’s former head of international tax, Peter Collins, shared confidential information from briefings with Treasury with colleagues.

Already nine partners at PwC have been stood down from their roles, including Pete Calleja and Sean Gregory.

Parliamentary sources have confirmed they have seen PwC’s list, but noted it was not supplied with the colour coding being used on internal lists assembled by the firm as it seeks to determine the potential exposure of partners.

An earlier form of a list of PwC partners shown to this publication grouped partners under four colour labels.

The most severe category, red, contained only a handful of partners, with a similar amount grouped under amber.

PwC sources indicated the list of 63 names supplied to parliament probably included most of the firm’s international tax partners, tax leadership and directors, as well as a mix of client service partners for impacted clients caught up in the aggressive tax minimisation strategy put forward by the firm in response to proposed laws. PwC used the confidential information to design strategies to attempt to circumvent the 2016 Multinational Anti Avoidance Law, a move the Australian Taxation Office said threatened as much as $180m in Commonwealth revenues.

Tom Seymour stepped down as PwC chief executive as the scandal unfolded. Picture: Gary Ramage

Mr Collins was deregistered and banned from practising for at least two years by the Tax Practitioner’s Board, which flagged on Wednesday it was looking at expanding the scope of investigations into PwC amid concern partners at the firm failed to report the conduct.

The tax scandal has cost PwC a huge amount of political capital and seen an exodus of senior ­leadership.

Moves by PwC chief executive Tom Seymour to head off the crisis with a review fell flat, with the Queensland-based partner quickly exiting his role after the firm’s board “agreed with Tom that this is in the best interests of the firm and our stakeholders”.

PwC has also lost its chair Tracy Kennair and risk committee head Paddy Carney, while former chair Peter van Dongen and corporate and global tax partner Paul Abbey have both vanished from the firm’s board.

The Australian Federal Police is now investigating PwC and Mr Collins after Treasury referred the firm’s conduct.