From Schwartz Media. I'm Ruby Jones.
This is seven AM. It was one of the biggest corporate scandals the country has ever seen.
Much of the focus and outrage in parliament House over the past week is centered on the extraordinary breach of trust at PWC's is.
One of the most stunning business stories of the year.
Really, when the torch has been shot upon it, it's refused to open itself.
Up when it was revealed that PwC had used confidential government information to enrich itself and its corporate clients. Since then, there have been two parliamentary inquiries, an AFP investigation, nine investigations by the Tax Practitioners Board, one internal review, and an investigation by the international arm of the company. Yet
important questions remain unanswered. Today Special Correspondent Jason Kotsukus on the key questions at the center of the tax leak scandal and when we can expect answers to them.
It's Tuesday, July thirty. Jason.
When the PwC tax leak story first broke, it was a huge story. How quickly do you think you realized the scope of what we were dealing with.
So when the first story was written about this. I didn't really understand the significance of what had happened. The first story was about Peter John Collins, PWC's former head of international tax, someone i'd never heard of, being suspended
by the Tax Practitioners Board. It wasn't until a couple of weeks later that I really understood that Peter John Collins had agreed on a strictly confidential basis to help the Australian government plan and write multinational anti avoidance tax laws, and then before those laws were introduced in twenty sixteen, he had knowingly shared what he knew with companies here in Australia and overseas and was trying to help them avoid the very laws that Peter Collins had helped the
Australian government.
Right, they say one partner shared the information, They say, we should have had a policy in play.
Tom Seymour, the CEO, he came out and said, look, this is just one bad apple and it was just him only he knew about.
It all to that there is a risk that one could perceive with the exact words, that in all of his dealings there was a conflict.
It wasn't until journalist started asking more questions, and that the Senate got involved. You know, through Deborah O'Neil and Barbara Pocock, that we understood that there were about thirty five people inside PwC that knew about it, possibly more, and that there were these fourteen clients who'd been provided with the advice and had been helped to sidestep the new tax laws.
In recent days, it's become very clear that the PwC Price Waterhouse Coopers used secret government information that belongs to the Australian people to advise clients how to sidestep new tax laws that were under construction.
That's when it all kind of started to really become clear that this was an outrageous breach of trust that involved not just one person but the whole of the PwC Australia tax practice. Then, I guess, like most people, I felt pretty outraged about it.
I think a lot of people felt that way. In your opinion, what has the response from PwC been like so far?
Well, right from the beginning, the then chief executive of PwC, Tom Seymour, was anything but transparent about the nature of what had happened and how many people knew about it, and Tom Seymour's attempts to cover up what had happened have kind of been continued by every other person at PwC that has spoken publicly about this. They haven't been frank and open and honest about what happened. And I think we really still don't understand who exactly inside PwC
received this confidential information from Peter John Collins. And then we need to know what companies that PwC tried to use that information to win new business with. And that's another thing that they have refused to disclose. There was an internal investigation that was commissioned by PwC International. They
commissioned a law firm Link Leaders to investigate. They said that they would make that report public, but that report remains secret, and I think there's still, yeah, lots of questions.
To answer here, right, So why is it that that internal investigation has not been released as was promised?
Why is it secret?
Well, it's a really good question, and despite multiple requests from the Senate and the House of Representatives to see the report, PwC Global has steadfastly refused to release it, claiming that it contains all this privileged information that's confidential to PwC, and even PwC Australia Chief executive Kevin Burrows, who receives more than a quarter of his four million dollars and your salary from PwC International, claims that he hasn't even seen a copy of the report.
Have you read those reports?
There are no reports, Senator at this one. There is. We had investigation that was conducted with them by them, and we received legal advice from them.
I don't know.
I find that hard to believe, but I guess we have to take his word for that. But I think the fact that PwC haven't been prepared to release the report tells us that there's something pretty serious contained in its pages.
So which PwC executives still haven't been held accountable. That's after the.
Break, Jason.
On Friday, we'll be hearing more evidence from PwC at a Senate hearing. The current chief executive, Kevin Burrows is due to speak. What questions do you think that he needs to answer.
I think he could start with telling us how much money he makes, because up until now Kevin Burrows has obfuscated and dissembled and proved unable to answer that one basic question. When he was first asked that question, he said his annual salary was two point four million a year.
Mister Burrow's what is your salary in the role that you're in.
Currently two point four million dollars said.
Thank you very much, mister Burros, and thank you for being a.
Couple of days later he sought to correct the record and inform the Senate that his actual salary was two point eight million a year. And then last month Burrows advised the same Senator, Deborah O'Neil, the Labor senator who's been leading a lot of the investigation on this, he was actually getting a one point two million dollar top up each year courtesy of PwC International for undefined services
to the PwC network. You know, Kevin Burrow's salary is not material to the fundamental wrongdoing that took place here, but it's a kind of measure of his preparedness to be open and honest with the Australian public. And if he can't answer that basic question, then what does it say about the rest of his testimony that he's provided so far and that we're can hear on Friday.
And in terms of Kevin Burrows and the transparency that we can fairly expect from him. He took over as the chief executive of PwC after the scandal broke, so after Tom Seymour was forced to resign. So to what extent do you think that we, the public and the Senate can really hold him responsible for things that happened before his tenure.
Well, I don't think we can hold him responsible for the actions of Peter John Collins and the other partners at PwC Australia, but I think we can hold him accountable for what's happened since then. So Kevin Burrows is career PwC partner. He was based in Singapore and the Global Board clearly tapped him on the shoulder and said we need you to go down to Sydney and try to clean up the mess in PwC Australia. So Kevin
Burrows has walked into a very messy situation. The partnership was effectively involved in a civil war, and he's encountered a lot of resistance. I think internally people are resentful that an outsider was appointed to the PwC Australia partnership. Partnership are resentful that they've all been forced to take a pay cut, a significant pay cut. The total staff
that have been forced out is around seven hundred. So it's a very messy situation that Burrows has walked into, and I think that he has struggled to contain a lot of the internal anger within PwC over what's happened.
And it isn't only Kevin Burrows who is due to come before the Senate, it's also his predecessors, including Luke Say who is actually in that role as chief executive when a lot of this conduct was underway. So what would you like to see him pressed on?
Well, the thing that I most want to know is exactly what Luke Sayers knew about what was happening at PEWC under his watch. He's now, of course the president of the Carlton Football Club, a real mover and shaker in the Melbourne political, social and business circles, and up to now he's managed to sort of kind of weave his way through all of the flat that has been
coming his way. But the main focus of the committee hearing on Friday has to be to hold Luke Sayers to account and really get to the bottom of what he knew about what was going on at PwC while he was running the show.
And just finally, Jason, what does it say to you that, more than a year on from this story breaking was still falling far short of full transparency when it comes to what PwC did and didn't do, that there still seems to be this effort to contain the damage. Do you think that the PwC still thinks that it can come back from this, that it can regain the trust of the Australian government and the public.
Well, it suffered a massive hit to its reputation and even though I think the firm will survive, it's going to take a long time to recover. It wasn't just that they effectively stole this information from the Commonwealth.
You know.
One of the things that's angered me the most was, and we've seen this in the one hundred and forty four pages of emails that the Tax Practitioners Board obtained from PwC. And what we saw in those emails was just contempt for the Commonwealth. They just really took advantage of the Australian public here and tried to help their
clients cheat the Australian taxpayer. Of tax revenue that they owed, and I feel that they haven't shown sufficient your remorse for the actions that were taken, and I don't think it will fully recover until it does offer full transparency about what happened.
Jason, thank you so much for your time.
Ruby, always a pleasure to talk with you. Thanks very much.
Also in the news today, Foreign Minister Penny Wong has announced plans to limit China's influence in the Pacific with a new cable co co activity and Resilience Center designed to boost connectivity for Pacific nations. Australia has committed eighteen million dollars over the next four years for the center, which will be staffed by Australians. It will enable the sharing of information and regulation of undersea cables. And A commentator has been removed from Olympic Games coverage over a
sexist remark about the Australian women's freestyle relay team. Eurostar commentator Bob Ballard was discussing the gold winning team when he suggested they were hanging around doing their makeup. I'm Ruby Jones. This is seven am.
See you tomorrow.