PwC CEO Resignation Reflects Need for Structural Consultancy Reform

The overnight resignation of PwC’s CEO as a result of the ongoing tax avoidance scandal reflects the need for structural reform to the way the Government engages large consulting firms to perform core government work, according to integrity experts at the Australia Institute.

Experts have reaffirmed their recommendations to the senate inquiry into consultancies and called on PwC to donate to charity the $2.5m taken for advice on tax avoidance, and the nearly $1 million it took for work relating to the Robodebt scheme before burying the final report.

Recommendations from the Australia Institute submission to the consultancy inquiry:

·        PwC should be banned from receiving government contracts or confidential government information.

·        The abolition of public service staffing caps.

·        New guidelines on the use of consultants, a revolving door policy for public servants and capacity building included in consultancy contracts.

·        The Senate should issue a standing order for the production of consultants reports.

“While the resignation of the PwC CEO is welcome it will not fix the ongoing structural issues with the consultancy industry,” said Bill Browne, Director of the Australia Institute’s Democracy & Accountability Program.

“The government has an over-reliance on consulting firms for core Government work, and consultants’ advice can be used to distort the public debate.

“What Australia needs is a reinvigorated and properly-funded public service that is prepared to give frank and fearless advice to the government. The public service need the skills and knowledge to do in-house what has been outsourced to expensive and self-interested consultants.

“PwC should donate to charity the $2.5 million it took for advice on tax avoidance based on confidential information and the nearly $1 million it took for work relating to the Robodebt scheme before burying the final report.”

“Between PwC’s role in multinational tax avoidance and the shabby way they handled their report into the Robodebt scheme, there are serious doubts about whether any work the consulting firm did for government can be relied upon. An independent investigator should be commissioned to check every piece of work the government outsourced to PwC for quality and integrity.

The Australia Institute’s submission to the inquiry into consultancies found that:

·        When consultants are contracted to do work that public servants could do, it stops the public service from developing skills and knowledge in-house.

·        Consultants lead governments to make bad decisions when they produce flawed analysis, tell the government what it wants to hear or bury reports that are unfavourable to the government.