Another pension fund halts work with PwC Australia after scandal

Sydney — On Friday, Australia’s third-largest pension fund put  new work with PwC Australia on hold, making it the fourth fund to freeze out the firm over its misuse of confidential government tax plans.

The A$150bn ($100bn) Aware Super said it had temporarily frozen new contracts with PwC “out of an abundance of caution” and was deeply disappointed by reported failures of governance, accountability and culture at the firm.

“The people of PwC we’ve worked with have been exemplary professionals who have worked hard to help us deliver for our members... We look forward to the full extent of this issue being promptly investigated and addressed,” an Aware spokesperson said.

Last week, Aware said it was working with PwC to find out if any tax advisers who had worked with the fund were implicated in the scandal. PwC declined to comment on Friday.

Australia’s A$2.4-trillion pension sector is leading an exodus from PwC Australia, and so far four major funds that collectively manage about A$750bn have paused work with the firm in a week.

While those lost contracts will not seriously dent PwC, which last financial year made A$3bn in revenue, there is a risk others will follow, just as a number of government agencies have said they will pause or review contracts with the firm.

PwC has come under fire after a former tax partner who was advising the government on laws to prevent corporate tax avoidance shared confidential drafts with colleagues that were used to pitch US technology companies, among others, for work.

A senior tax office official told a Senate inquiry on Wednesday a cache of internal PwC emails released in May showed “the international tax network within PwC was operating internationally to subvert the Australian law development or the application of the law”.

PwC on Monday named at least 67 current and former staff associated with the breach in an unpublished letter to MPs.

Reuters