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Did PwC consult on the final recommendations of the Senate Inquiry into PwC?

by Michael West | Jun 13, 2024 | Government, Latest Posts

Was PwC commissioned to write the recommendations of the Final Report of the PwC Inquiry into PwC? Michael West reports.

It was like the footy player whose team had driven all the way up the field only to spill the ball over the try line.

After 14 months of inquiry, 60 submissions and explosive evidence of cover-ups, massive fees for no service, countless lies, and damning evidence that the privatisation of government has miserably failed, the Senate Committee on Finance and Public Administration has handed down its final report into ‘Management and Assurance of Integrity by Consulting Services Management and Assurance of Integrity by Consulting Services‘.

Otherwise known as the PwC Inquiry … it’s a whitewash.

The Report itself is fine. It goes into the Big Grift in detail, exposing the untenable conflicts of interest, rorts like the exploitation of Legal Professional Privilege, and much, much more.

It’s the politics that are the problem. The recommendations. The Committee, stacked as it is with Liberal and Labor people, has delivered 12 recommendations while PwC itself continues to refuse to deliver information requested by the senators.

There is nothing in this feeble set of recommendations to address the systemic problems and egregious waste which have arisen from the privatisation of government since Big 4 consulting fees began to go ballistic with the government of Tony Abbott in 2014. Okay, a couple of the disclosure measures are worthwhile but the rorts will henceforth roll on.

We run through them here:

Many readers will have been watching in admiration as a couple of the senators, principally Barbara Pocock and Deborah O’Neill held Big 4 feet to the fire during committee sessions. This was our politicians at their best. Alas, although the Greens chapter is the Report – “A Very Public Swindle” – is worth a read, the recommendations have been compromised because both Labor and the Coalition control the Committee and get millions of dollars in donations each year from EY, PwC, KPMG and Deloitte.

The Big 4 has the political duopoly stitched up. Even this week, as Stuart McCarthy broke the story of the Department of Veterans Affairs slotting $73m to PwC to connive on how to avoid a Royal Commission, how *not to reform”, this committee and its findings present a case study in how to dodge reform.

Paid to Not Reform: Veterans’ Affairs chucks $73m at PwC to dodge Royal Commission

It should be said, despite many being crestfallen at the impotence of the recommendations, that the whole affair has been worthwhile in exposing the rorts, in bringing accountability. The effect of this, even as PwC is already plotting its comeback to government consultancy to milk the fat cow of bureaucracy, will be to moderate behaviour, to make procurement a better process.

Yet the essential failures of the outsourcing of government remain; chiefly the massive conflicts of interest and the cost to the public purse. How can it possibly be more efficient to privatise government to people charging $500 per hour when public servants are already paid $50 per hour to do their job anyway?

Ziggy plays for time: PwC’s dual ‘independent reports’ a dual whitewash

Conflicts of interest

The critical conflicts of interest are that the Big 4 run three businesses: consulting, audit and tax advisory. There is a conflict between the latter two as an auditor has to sign off financial statements as ‘true and fair’ while the tax advisor across the Chinese Wall of gossamer tries to push the tax laws and accounting to the very limit to rake profits offshore for their multinational clients.

Then as evinced in the Inquiry, PwC well and truly breached its conflicts when it consulted to government on new tax laws while it was advising its MNC clients on how to skive out of paying tax by grifting those very laws.

Auditors are meant to adhere to professional standards, and tax lawyers have their legal obligations, but consultants? Who regulates consultants? Nobody. And nobody effectively regulates the Big 4 because their are too big and too powerful. Imagine ASIC bringing a case against PwC, Deloitte, EY or KPMG?

Accountants of Fortune

After warning for years that this power and the conflicts of interest – indeed and poor audit standards – was a looming train wreck, the government turbocharged the train.

The very first story we published when establishing MWM in mid-2016 quoted a former adviser and tax expert at PwC and EY, George Rozvany:

“The Big Four have, under a Rasputin-like cloak of illusion strayed from their original and critical role of verifying the accuracy of financial accounts for all stakeholders, to be “accountants of fortune” merely representing the accounting position for multinationals and developing aggressive international tax avoidance practices.”

Oligarchs of the Treasure Islands

Meanwhile, government consulting revenues was exploding – delivering double-digit increases in annual revenue at all the firms. The gouge on Defence in particular is epic, with 2,000 consultants roaming about the Department down in Canberra with their special passes.

Yet it has also infected almost every part of government. As Stuart McCarthy said this morning:

“The long-awaited Senate inquiry report on the “big four” consultancies and their multi-million dollar contracts with federal government departments has been published, with 12 recommendations calling on PwC to publicly name the executives responsible for the Australian Taxation Office confidentiality breach, and improved regulation and management by the consulting industry and government regulators.”

“During the inquiry, Labor Senator Deborah O’Neill and Greens Senator Barbara Pocock railed against the big four’s “toxic culture” in numerous media interviews. Despite all this colour and movement, there is no hint of accountability for the departmental secretaries and other senior government officials who approve and manage these contracts on behalf of the taxpayer.”

Veteran scamming

No mention of the billion-dollar “veteran-centric reform” scam is made in the inquiry report. Conceived to forestall the Royal Commission into defence and veteran suicide while retaining the “byzantine”, “archaic”, and “not fit for purpose” legislation at the heart of the veteran suicide crisis, and which the Royal Commission has since recommended be overhauled anyway.

“PwC was paid $73 million for a “reform” program that resulted only in a bigger, more expensive and equally dysfunctional department while exploiting their access in the department to pursue their commercial interests in the dodgy health information technology start-up Innowell.

“While it’s true PwC’s scamming of the veterans affairs portfolio took place under the Turnbull-Morrison government, the Albanese government is perpetuating the scam. The departmental spend on annual “upgrades” to the IT and management systems purportedly “reformed” at a cost of $1 billion has not changed, indeed its operating costs have increased.

“Current veterans affairs minister Matt Keogh – a former Community and Public Sector Union delegate – has expanded the department by 500 staff while thumbing his nose at the Royal Commission’s recommendation to fix the legislation that drives his department’s bureaucratic dysfunction.

What’s the scam? A bigger, more expensive self-licking ice cream,

while nobody is held to account for a billion dollars in taxpayers’, money, flushed down the drain.


Michael West established Michael West Media in 2016 to focus on journalism of high public interest, particularly the rising power of corporations over democracy. West was formerly a journalist and editor with Fairfax newspapers, a columnist for News Corp and even, once, a stockbroker.

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