Subjects: PwC, corporate law enforcement
E&OE………
Chris Kenny
But I want to get now onto a growing scandal that we haven't really touched on so far on this program. And you know you're down when Mr. Interest Rates himself is taking pot shots at you in Senate Estimates. And that's what happened this morning. Let's hear what Philip Lowe had to say about Price Waterhouse Coopers.
Philip Lowe
We're as appalled as you are. The use of private information that is sort for commercial gains - wrong. It destroys trust, as you know, it's unacceptable. And from our perspective, and I think yours as well, it should come with very serious consequences for those who did the wrong thing.
Chris Kenny
Let's cross the camera and catch up with Senator Andrew Bragg to take us through this issue and find out whether Philip Lowe was right. Thanks for joining us, Andrew. Just walk us through this issue. It's getting worse the more we know about it. But essentially, over a number of years, this major consulting firm, PwC, had access to secret government information, Tax Office information that it was providing advice on. And it used that advice to try and help other customers dodge tax.
Senator Bragg
Well, Chris, basically, PwC took the government's secrets and gave them away for a financial return. Now, we know now, because of Senate Estimate that the Tax Office was aware of this. They made referrals to the AFP. The AFP did very little or nothing. And it's another case of a failed attempt at law enforcement in Australia. And whether it's ASIC or whether it's the AFP or the ATO, unfortunately, white collar crime is a major issue in Australia.
Chris Kenny
Yeah, the lack of follow through on that investigation is a big worry. This happened while you were in government, it's been continuing on under Labor. How can it be rectified now? Presumably, we're getting to the bottom of it. Some people have been pushed aside from PwC, but we don't know who they were.
Senator Bragg
Well, ultimately, there needs to be consideration given to civil and criminal penalties. This is something that will happen through the AFP process, and I expect that they will make recommendations to the DPP as appropriate. But the reality is that there are so many white collar crimes in Australia which are not punished. There are Royal Commissions and there are other Inquiries. But I don't think that the regulators are effective at enforcing the law. And I don't believe the answer is to pile more and more new laws on the books here. The answer is to actually get the regulators to be effective and to prosecute people.
Chris Kenny
Sure. But what really angers me, and I'm certain it must anger most taxpayers, is we know that governments and people generally don't want big corporations dodging tax, avoiding tax unnecessarily. We want them to pay their fair share. And yet this consultancy is getting a lot of government money, hundreds of millions of dollars of government money in contracts. And for our trouble, we're spending that taxpayers money, and they're helping other companies shortchange taxpayers. So we're losing both ways here.
Senator Bragg
I have to say in my four years in the Senate, I have not seen anything as extraordinary as the Commissioner of Taxation last night explaining how they were aware of this information that PwC was stealing the government secrets to enable clients to dodge tax. That they, the ATO, made referrals to the AFP and nothing happened. And this happened six years ago. It is extraordinary. But I have to say that while that is shocking, it is consistent with the approach taken by ASIC and other law enforcement agencies in that they don't seem to be very focused or minded to do many things. It's very frustrating.
Chris Kenny
Well, the other thing that this highlights is just how much government work is outsourced to these big consultancy firms that they make a motser out of government. And I think a lot of the time it's unnecessary. A lot of the time it's public servants buck passing and looking to cover their butts, really. But we'll come onto that another time. I appreciate your time joining us, Andrew. Senator Andrew Bragg there, Liberal Senator for New South Wales.
[Ends]
