PwC slashes 329 more staff, up to 37 partners face early retirement

Embattled consulting firm PwC is slashing its staffing levels again as it restructures a business that continues to suffer as a result of the fallout from the tax leaks scandal.

PwC announced it would make 329 roles redundant over the next nine months and up to 37 partners would accelerate their retirement from the firm. The moves follow a review of its remaining business after the forced spin-off of the consulting firm’s government arm, which accounted for more than 20 per cent of its revenue and is now known as Scyne Advisory.

PwC Australia CEO Kevin Burrowes says the cuts will help realign the business structure with the firm’s new long-term strategy.

“The purpose of this review was to ensure the firm is positioned for future success and long-term growth. Therefore, current to medium-term economic and market conditions were also taken into account,” PwC said.

The firm, one of the big four accounting firms along with EY, Deloitte and KPMG, has come under immense pressure this year, and was forced to spin off its lucrative government business for $1 after partners at the firm allegedly used confidential government tax plans to help multinational companies avoid the new scheme.

“This has been a very challenging and complex process, but an important one, as we realign our business structure with our new long-term strategy,” PwC Australia chief executive Kevin Burrowes said.

“At its heart, this reorganisation will make the firm a more simplified, efficient and centre-led business, enabling us to continue delivering the highest quality of service to our corporate and private-sector clients.”

The latest round of job losses adds to the 340 staff sacked in November as PwC’s core consulting business was hit by the tax leaks scandal and general economic conditions.

“We acknowledge that days like today are especially difficult for those affected, as well as their teams and colleagues. I can assure you that we will work closely with impacted individuals to ensure they are aware of their options and next steps,” Burrowes said on Wednesday.

PwC employed more than 8000 people, including more than 900 partners, before the scandal. About 1200 staff and 100 partners joined Scyne Advisory last year.

The latest cuts come just days after longtime PwC client Westpac announced the replacement of PwC as its auditor. The firm generated more than $70 million in fees with the bank over the past two years.

While the trouble centred on PwC’s tax practice, not its audit business, the scandal triggered a damning report into the culture of the whole organisation and led to questions about its suitability as an auditor for some of Australia’s biggest companies.

The drain of business is also hitting partner pay levels, which dropped 12 per cent last year, and are expected to drop a further 30 per cent this financial year as PwC bears the full brunt of revelations that a number of senior partners had used confidential government advice to drum up work from multinational companies and help them pay less tax.

Read more:

• Secrets and lies: The undoing of global giant PwC
• The consulting sector faces a reckoning
• Carlton boss Sayers rejects blame over PwC scandal

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