"If you're fond of sand dunes and salty air/Quaint little villages here and there"
~ At the (cold) river
Meet the top tax bureaucrat who can’t stand liars
Tax Inspector-General and Tax Ombudsman Karen Payne talks about what big law can teach the APS and her love of Ennio Morricone, in our public servant Q&A.
What is the best career advice you have been given?
Be authentic. There was similar advice I was given during a partner presentation. Somebody said: “There will come a time in your life when you feel comfortable in your own skin.” That was very comforting for me when I was early in my career and did not feel comfortable in my own skin.
I now feel comfortable in my own skin, but it’s fair to say it took longer than you would think. I was well progressed in my career, probably around the time I made partner [at big six law firm Minter Ellison].
Tax Inspector-General and Tax Ombudsman Karen Payne.
What was a moment in your career that changed you?
It would be remiss not to acknowledge the education piece that has been something that has changed me and set me on my career path. But joining the partnership at Minter Ellison did open up lots of opportunities. It allowed me to develop a practice and my career on my own terms. It also contributed opportunities for me to develop improvements to tax law and tax policies.
[After making partner, Payne was invited to join the Board of Taxation. She later went on to become the inaugural chief executive of the body.]
What is your morning ritual/exercise routine?
I am not a morning person. I get up, have a coffee, check the news and go to work. I try to walk most evenings and on weekends I try to do an extended walk or a bike ride. Currently, I have a trip booked to Three Capes Track in Tasmania in January next year.
What is the most important thing you look for when hiring someone?
I am a pretty direct person, so I like to work with people who are equally frank. I also like to work with people who can demonstrate they have an ability to think things through, their measures are considered. I also really value good communication skills, not someone that faffs about, but identifies the key message and delivers it.
Is there anything you think the APS should adopt from Big Law?
There are a couple of things:
What is your favourite music, film, book, and what are you reading?
Music is varied, but I would list Fleetwood Mac, The Cure, PorterHaus, Groove Armada, but also classical, I go to the Sydney Symphony Orchestra.
Favourite movie would be [the 1986 film] The Mission, but mostly because of the music by Ennio Morricone. Gabrielle’s oboe, in particular.
I don’t have a favourite book. I’m not a great reader of fiction. I read psychology or self-help kind of books, and at the moment I am reading Ikigai: The Japanese Secret to a Long and Happy Life.
What’s your secret to resolving high-stakes tax disputes?
Someone described the Tax Ombudsman’s role as speaking truth to power, and if you are going to speak truth to power, they need to respect the fact you are speaking with integrity backed up by evidence. [You are going to the Tax Office] and saying: “Hey, this is what we see, and we don’t think this is right, and we think this is how you should correct that.”
If you’re looking for an actual change in the Tax Office’s behaviour or a change in their decision, then you really need to be coming at those kinds of things with integrity.
Who is the most influential person in your life?
My partner, Dr Ken Stevens. He’s a smart guy whose opinion I value, and he’s a great sounding board for me.
If you were to start the tax system over, what would you change?
My answer will be heavily informed by my experience as a Tax Ombudsman. We have a self-assessment system for tax, but it’s also true almost all people in our system need assistance to comply with their tax obligations.
If I was designing it from scratch, I’d recognise people will make mistakes. The system should be designed to help them minimise mistakes but also correct mistakes and, ideally, help them not to make mistakes in the first place. But recognise humans will make mistakes and so you should allow the administrator to help taxpayers correct for genuine and honest mistakes.
What is your pet peeve?
Lying or trying to cover up the truth. It’s impolite and disrespectful. I consider myself an honest person, some people would say brutally honest at it times, so I am genuinely peeved when people don’t communicate truthfully.
This is an edited transcript of a conversation.
CODA: The Mission
Timeless monoliths of hate
infuriating my cryptic devotion
the code to open the final gate… where the funeral
dream resides
awaiting into the emerald abysm
guided through visionary flames
guided through visionary flames
by the calling of an astral fiend
rest in fire, arriving …so far from home, but this is
the place
f-rs-eing …sun and moon corroding, this is the place,
finish the mission
…the final time to liberate and to unveil the code to
open the final gate
Burrowes, Sayers to front PwC inquiry
PwC Australia chief executive Kevin Burrowes will appear at the Senate inquiry into consulting on Thursday, and will be followed by former CEO Luke Sayers.
The appearance by the two men – along with a raft of other executives from the firm – will be the first time anyone from PwC Australia has fronted a grilling at the federal level about the firm’s tax leak scandal since its full extent became public in May.
PwC Australia CEO Kevin Burrowes.
Mr Burrowes alerted all staff about his appearance in an email on Friday morning, saying it was part of his push to “re-earn the trust of our people, clients and stakeholders”.
Also appearing will be the firm’s head of people, Catherine Walsh, and its chief risk and ethics leader, Jan McCahey.
Mr Sayers, who was CEO between 2012 and 2020, will likely be questioned about his knowledge of the tax leaks while head of the firm, about crucial meetings he had with ATO second commissioner Jeremy Hirschhorn regarding the behaviour of the firm’s tax advisers in 2019, and the election of the firm’s new CEO in 2020.
Mr Sayers might also be quizzed about a 2019PwC-funded trip that Mr Hirschhorn took to Paris to address the firm’s two-day global tax conference for clients and partners.
Representatives from the Australian Securities and Investments Commission, the Professional Standards Authority, and Treasury are also scheduled to give evidence on Thursday, the seventh day of public hearings for the inquiry.
“We recognise the important work the Senate is doing and we are equally determined to ensure our stakeholders have the utmost confidence and respect for our industry. I am looking forward to sharing PwC Australia’s perspectives on the important issues before the committee,” Mr Burrowes wrote in the email.
“As we have said publicly, we are not proud of the findings from the Tax Practitioners Board investigation into PwC, which revealed behaviour which does not meet our values and expectations, and behaviour that betrayed the trust of our stakeholders. We are sorry, and we know we need to re-earn trust.”
The tax leaks issues date back to 2013, when former international tax partner Peter Collins triggered the scandal by sharing confidential information with PwC personnel who used it to help clients sidestep Multinational Anti Avoidance Laws he was helping Treasury develop.
‘Shadow culture’, ‘multiple failings’
PwC last week released a scathing report into governance at the firm that found a “shadow” culture that tolerated bad behaviour in the pursuit of profit “growth at all costs” and a lack of governance that “went unexamined and uncorrected for many years” partly led to the firm’s tax leaks scandal.
Former PwC CEO Luke Sayers. Wayne Taylor
A separate summary of three legal reports added that a “combination of multiple failings” by individuals and the firm’s governance, culture and accountability systems also contributed to the scandal.
Mr Burrowes said the report and summary provided “a complete and holistic view of what happened and what went wrong”.
“Our appearance at the Senate next week is another important step the firm is taking as we seek to enhance our culture, governance and re-earn the trust of our people, clients and stakeholders,” he wrote.
“We recognise that ultimately, we will be judged not by our words, but by our actions. From the top down, we are determined to rebuild and re-earn the trust of our stakeholders – step-by-step – every day.”
The Senate committee had earlier been reluctant to call PwC to appear at the inquiry over concerns any testimony might interfere with the ongoing Australian Federal Police investigation into the matter.
In June, former PwC Australia CEO Kristin Stubbins appeared at a NSW inquiry examining consultants, where she said the sale of the firm’s public sector consulting arm to private equity investor Allegro Funds was designed to save the job of 1500 staff.
