KPMG are the very last people to train civil servants – but that’s what they’re going to do
Ex-PwC partner Paul McNab is totally back in business Rear Window
The collective shrug by the profession appears
well in progress. Not least as regards this tax lawyer.
Myriam
Robin Rear Window editor
Sep 1, 2024 – 6.36pm
The players in PwC’s tax leaks saga require two things to get on with their
lives.
The first is for everyone to stop talking about it. The second is the
renewed embrace of their peers.
While the PwC bonfire retains interest to parliamentarians and journalists, the collective shrug by the profession appears well in progress. Not least as regards tax lawyer Paul McNab.
One of the first four partners named as having appeared on emails discussing
the firm’s lead on the ATO, the scandal in effect forced him out of his job at
DLA Piper, where he’d landed after moving on from PwC three years earlier.
Later, he would sue PwC for withholding his retirement benefits (the suit is
ongoing), while denying all wrongdoing and starting
his own firm to service the clients who’d stuck by him.
Said clients aren’t the only ones letting bygones be bygones.
At the Tax Institute’s annual tax summit later this month, McNab has been
invited to present an educational session on Australia’s double-taxation
agreements, covering developments in international tax law.
Also appearing over the three-day event is Tax Practitioners Board chairman Peter de Cure, head of
the regulatory body that deregistered ex-PwC partner Peter Collins and
kicked this whole saga off, and new Australian Taxation Office commissioner Robert Heferen, whose
own organisation spent years feuding with PwC. Hey: that won’t be awkward at
all!
While denying wrongdoing, McNab had at least two fateful cameos in the
development of the
PwC saga.
The first was his meeting with then-ATO deputy commissioner Mark Konza to outline
how the PwC-advised Uber had cleverly sidestepped new government tax laws to
force it to pay more Australian tax. The discovery of this so enraged Konza
that “as soon as I got back to the office I started an audit on that company
and others that have been using that scheme”, marking another escalation in the
ATO’s war with PwC.
McNab’s other known role was a rather revealing email he sent to then-PwC
chief Tom Seymour
in which McNab both lauded the “accuracy of the intelligence Peter Collins was
able to supply us” and his division’s proactive work in courting the US tech giants
likely to be affected.
Apparently, McNab was just angling for a big bonus, which didn’t work. But
the email became a vivid suggestion of how some within PwC knew and thought
nothing of Collins’ uncanny insights.
Seymour, for one, received McNab’s email, but told a parliamentary hearing
last month he’d barely taken it in. Alas. At least being ignored isn’t a fate
likely to befall McNab now. Including at the upcoming tax summit.
https://www.afr.com/rear-window/luke-sayers-lands-and-expands-in-the-capital-20240826-p5k5f7
Opinion
Luke Sayers lands
and expands in the capital
Unburdened by the PwC fallout, Sayers is hiring
in Canberra. A look at the federal tenders won by his firm helps explains why.
Mark
Di StefanoColumnist
Aug 26, 2024 – 5.59pm
When St Kilda’s Jack
Higgins snapped a goal in the final seconds on Sunday,
Carlton’s finals dreams looked headed for hilarious disaster. But a result
going their way in Perth a few hours later meant the Blues limp into the finals
and, more importantly, that Luke
Sayers’ impossible dream of a flag as club president lives to
fight another day. Did you ever doubt him?
The man’s insane luck continues to spark wonder, after his old PwC
colleagues watched their firm disintegrate. Repercussions for the former CEO?
Not in these parts. Especially, not in Canberra.
As mentioned
last week, Sayers’ eponymous consulting firm appears to be doing so well at
gobbling up work from Canberra’s departments and agencies that he’s hiring new
staff. A closer look at the public tenders that Sayers Group has won helps
explains why.
Since 2020 (mere months after “hospital-passing” PwC onto Tom Seymour) Sayers
Group has been given 28 contracts with the federal government and its agencies,
according to the tender portal. In total, his firm has squelched more than
$13.3 million for that work.
Most of it seems unremarkable: lots worth a few hundred thousand dollars to
out-source reviews and procurement. But in several instances, contracts began
at one price, then amended up considerably.
Take the Sayers Group computer services contract with the climate change
department, which started in December last year and was due to last 11 months.
By April, the contract had blown out by an extra $1.6 million, amended to be
worth almost $3.3 million.
It is such a common practice in professional services that it’s referred to
as “land and expand”. You go into Myer looking to buy a suit, suddenly, you’ve
bought a tie, a new belt. Cufflinks? The shirt doesn’t even have the holes.
Best take them, anyway!
Clients of the big four firms know it well and there are often legitimate
reasons for revising up the work. Although where does that leave the public
tender process, wholly created to ensure taxpayers only pay for the firm with
the cheapest bid?
On four occasions, Sayers Group’s contracts have been marked up by between
60 and 246 per cent after they’ve begun. The total of the contract increases
comes to $4.2 million. That is, a near-third of the Sayers government take from
the feds. No wonder he’s hiring!
Management, IT and consulting firms have jammed their cost centres into
Canberra for years, and departments have green-lit all this siphoning of public
money into the private sector. It’s the unwinding of PwC that puts manoeuvres
like landing and expanding under scrutiny.
Remember: PwC was shut out from bidding for government work after its tax shenanigans came to light. The former CEO who oversaw the mess, however, is doing just fine. More than fine. You’ll have to find out how fine at the end of the contract.
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Mark
Di Stefano is Rear Window columnist,
based in the Sydney newsroom. He previously worked at BuzzFeed, the Financial
Times and The Information before joining the Financial Review as a media and
tech correspondent. Connect with Mark
on Twitter. Email Mark at mark.distefano@afr.com