The Defence Department has reported seven contracts with PwC, worth a total of nearly $6 million, since the firm’s tax scandal broke, Crikey can reveal.
Greens Senator David Shoebridge told Crikey that Parliamentary Library research showed the single contract worth the most money — $4.6 million for “management advisory services” — started on February 1.
That’s just over a week after the Tax Practitioner’s Board (TPB) issued a media release revealing PwC’s former tax partner Peter-John Collins had been deregistered as a tax agent over integrity breaches.
Collins had made “unauthorised disclosures” of information relating to proposed tax laws with colleagues at PwC, according to the TPB. The firm’s acting chief executive Kristin Stubbins has since apologised for “betraying the trust” placed in PwC.
Nine partners at the consultancy business have been placed on leave, and the Australian Federal Police has confirmed it’s investigating a report of “crime relating to the alleged misuse of confidential government information”.
Crikey can reveal the Defence Department entered into the following contracts with PwC after January 23:
- A contract for management advisory services, worth $4,610,000, which began on February 1;
- A contract for management advisory services, worth $25,000, which began on March 8;
- A contract for management advisory services, worth $874,500, which began on March 20;
- A contract for education and training services, worth $10,092, which began on March 20;
- A contract for education and training services, worth $36,640, which began on March 30;
- A contract for management advisory services, worth $142,499, which began on May 8;
- A contract for management advisory services, worth $139,745, which began on May 12.
It’s understood the Parliamentary Library advice doesn’t necessarily make clear what date the contracts were signed. That’s because Commonwealth procurement rules state contracts over a certain threshold must be reported to AusTender within 42 days of being entered into. The seven contracts were the ones published since March 6, 42 days after January 23.
In total, the Defence Department has 54 contracts with PwC, also known as PricewaterhouseCoopers, worth a total of $223,299,943, the department’s Associate Secretary Matt Yannopoulos told Senate estimates on Tuesday.
“I’m not aware of any that are entered into since May 17,” Yannopoulos said.
One of the 54 contracts is a $8.4 million “data sharing and analytics solution” project, assisting Defence and Veterans’ Affairs in sharing information, which began in July 2021, according to Yannopoulos.
“I’m surprised you have to pay PwC for data sharing, they normally do it free off their own bat,” Shoebridge quipped in estimates.
The senator, who is the Greens’ defence spokesperson, told Crikey the tax scandal hadn’t stopped the department “signing contract after contract with PwC”.
“This isn’t a single contract from a rogue tender panel, it’s at least seven contracts for work across the entire [Australian Defence Force]” Shoebridge said. “What this shows is how deeply PwC has its tentacles into the defence establishment and how complicit defence is with that cosy arrangement.”
PwC declined to comment when contacted by Crikey, but a spokesman pointed to Stubbins’ apology and actions taken by the firm in response to the tax scandal.
Apart from placing the nine partners on leave, PwC has also “ringfenced” its Commonwealth business “to minimise conflicts of interest and enhance governance”, made plans to appoint two independent directors to its governance board, and vowed to publish an independent review report in full once it’s finished.
“Although investigations are still under way, we know enough about what went wrong to acknowledge that this situation was completely unacceptable,” Stubbins said in a statement on Monday.
“No amount of words can make it right. But I am fully committed to taking all necessary actions to re-earn the trust of our stakeholders. And as we work through this process, I am committed to being fully transparent.”
The Defence Department was contacted for comment.
