Tax Office evidence draws Carlton boss Luke Sayers further into PwC scandal

The final report of a Senate inquiry into consulting services has raised further questions about what Carlton president Luke Sayers knew about the tax confidentiality breaches that occurred while he was in charge at PwC.

While the report, released on Wednesday, did not target individuals involved in the PwC tax scandal, Greens senator Barbara Pocock said further evidence provided by the Australian Taxation Office to the inquiry cast former PwC senior executives in a bad light.

Carlton president and former PwC chief executive Luke Sayers.

“What we do know is that Luke Sayers was warned by a senior tax officer to take action over serious misdemeanours involving PwC staff allegedly knowingly misleading government institutions,” she told this masthead.

“Those who led PwC through years of ethical failure have – so far — walked away with large rewards, saying they knew nothing and taking no responsibility,” she said in the report.

The Greens went so far as to recommend that Sayers’ new consulting firm, the Sayers Group, be banned from government contracts for at least five years due to his “leadership in the years of PwC’s confidentiality misdemeanours”. This recommendation was not supported by the other political parties.

A spokesperson for Sayers said he “supported the long overdue reform of the sector” and added that the Greens recommendation “had not been supported by the committee”.

PwC has been embroiled in scandal since October last year when the Tax Practitioners Board revealed PwC partner Peter Collins had used confidential government tax plans to cultivate fresh business from tech giants such as Google, Uber and Facebook, aiming to subvert the new tax regime.

Since then, the global consulting giant has spun out its government advisory business and sacked hundreds of staff and dozens of partners.

Late last month, the Tax Office provided further evidence to the Senate committee of a meeting between the ATO’s second commissioner, Jeremy Hirschhorn, and Sayers in 2019. In that meeting, Hirschhorn read out emails the Tax Office had received from PwC as evidence of the ATO’s concerns about a potential leak.

These emails related to seven specific areas of concern, including “breaching the confidentiality of a Treasury consultation process and the apparent commercialisation of that breach”, the ATO said in response to questions on notice from Pocock.

Pocock on Wednesday expressed frustration that the new details were added to the ATO’s evidence just days before the inquiry closed rather than when the allegations were first raised in August last year.

“We’ve been running our inquiry for well over a year now, and one week before our final report comes out, the ATO lets us in on what could be new damning allegations about bad behaviour at PwC,” she said.

“These latest revelations from the Tax Office certainly warrant further investigation.”

In October last year, Sayers appeared before a Senate inquiry claiming that he knew nothing of the scandal until after he had left PwC.

“Let me clearly say if the ATO had directly informally advised me as the CEO of PwC Australia that [former PwC tax partner] Peter Collins had breached obligations of confidence, I would have sought details and ensured a full and thorough investigation. They did not,” Sayers said.

‘Nothing has changed’

Sayers’ testimony attracted heated exchanges with the Senate committee after he said he could not recall a conversation with Hirschhorn, who testified at the time that he had advised Sayers to look through emails that PwC provided to the ATO.

“I referred to several of the emails in that discussion to give a flavour of the things we were concerned about,” Hirschhorn told the committee.

A spokesman for Sayers said: “While the ATO’s version continues to evolve and contradict itself and change, Mr Sayers has been steadfast and consistent and nothing has changed from what he has shared with the committee through the proper process.”

The ATO is expected to be questioned about its updated evidence on Sayers at a Senate estimates hearing on June 26.

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