Greens call for five year bans for PwC tax scandal and future breaches

Under a proposed bill, PwC would be barred from commonwealth work for five years and the government would have the power to blacklist others in response to future scandals.

Senator Barbara Pocock in Canberra. Picture: NCA NewsWire / Martin Ollman

PwC Australia would be banned from government work until 2028 under a bill proposed by Greens senator Barbara Pocock, who wants tougher consequences for the audit and consulting giant’s leaking of government secrets.

Under a bill to be put forward, PwC would be barred from Commonwealth contracts for five years since its former head of international tax Peter Collins shared confidential policy briefings with the firm, which front-run new laws. Current powers are inadequate and ad hoc, she said.

Senator Pocock’s bill would also give the government power to respond to future scandals involving unethical conduct, enshrining powers to put in place a blacklist for other operators.

The department of finance ban on PwC tendering for government work expired on July 14, but it failed to confess it had allowed PwC back for weeks.

Senator Pocock said her bill “would give the Commonwealth the teeth it currently lacks”.

“It would allow the Commonwealth to debar dodgy contractors, like PwC, from entering into government contracts and would deter unethical conduct,” she said.

“The Greens want to close the legal loophole that allows contractors who behave unethically to get away with it.”

Under the terms of the Greens proposed bill, if the Australian Federal Police, the Tax Practitioners Board, or the National Anti Corruption Commission were to secure convictions or a penalty, the relevant firms would also be excluded from government contracting for five years.

The PwC tax scandal remains under investigation by the Australian Federal Police.

Despite this, Finance told the government PwC should be treated as “equitably” as any other professional services firm.

Finance had attempted to publish its findings in late July, before Finance Minister Katy Gallagher demanded the department review its position.Finance made no change to its final report published in August.

Ms Gallagher also made no comment on the move.

Minister for Finance, Katy Gallagher, did not comment on the Albanese government allowing PwC to return to tendering for government contracts. Picture: NewsWire / Martin Ollman

The current Commonwealth Supplier Code of Conduct already provides powers to terminate contracts if suppliers flout it, however, the bill would represent an expansion to a government-wide ban rather than individual deals.

PwC was somehow able to retain contracts worth $14.3m with various department clients, even when it was formally iced out of Canberra.

“Labor must urgently fix the legal loopholes to ensure stronger protections from dodgy contractors and this bill is a gift for Labor,” Senator Pocock said.

“It’s unacceptable that the government must rely on the wrongdoer to agree to banning itself from undertaking future government contracts.”

PwC is restrained by a non-compete deal with its former government consulting arm, now known as Scyne Advisory, after its $16.7m sale to private equity player Allegro Funds.

Speaking in the Senate, Senator Pocock said PwC was now “back at the trough”.

“The two consulting inquiries made 52 recommendations between them, which were agreed to by both Labor and the Liberals. There is tripartisan agreement about what needs to change. But Labor are all talk and no action,” she said.

Senator Pocock also took aim at government spending on consultants, worth around $1bn last financial year.

“This is a business-as-usual approach from Labor following the PwC scandal. It’s a continued lack of transparency by a government which claims to be spending less, while in actuality, in fact, spending even more,” she said.

Ms Gallagher, responding to questions from Ms Pocock, said the decision to allow PwC to return to work for the government was not one a minister should make. “It is a matter for the department,” she said.

Multiple parliamentary committees have scrutinised the PwC tax scandal and the audit and consulting sector.

Liberal Senator Richard Colbeck said: “(PwC) should remain limited until the various investigations into the matter have been completed,” he said.

“Just because those who were allegedly involved have gone doesn’t completely clean the slate.”

Originally published as Greens call for five year bans for PwC tax scandal and future breaches