Whereas the hunters are in full tally-ho mode pursuing the PwC fox lastly flushed out of the Canberra thicket, there’s a complete colony of rabbits quivering within the lengthy grass, awaiting canine choosing up their scent.
To combine my metaphors, there’s a footlocker of footwear but to drop from the PwC scandal – and never on PwC.
There are hobnails due for Treasury, the AFP, the Tax Practitioners Board, the ATO and their political masters. Perhaps or perhaps not precise elected people, however actually the hive of political advisers and handlers that comprise the trendy politician.
And the theatre mounted by Treasury and Finance final week – the exhibits of concern and referral to the Australian Federal Police – have been uncovered as confected farce. The headline performances have been became embarrassments by the ATO.
ATO fact bombs
The ATO dropped bombs within the Tuesday evening session of estimates.
The AFP was consulted by the ATO over Peter Collins’ breach of confidentiality for 2 years from March 2018 – and the AFP determined it didn’t have sufficient to launch an investigation. With the efficient theft of knowledge from the Commonwealth, Plod plodded nowhere.
The ATO “expressed common issues” to Treasury in 2018 when asking it for a replica of Peter Collins’ confidentiality settlement – however not for the primary time, it appears Treasury is peopled by dolts.
The ATO ultimately handed over what it had on PwC and Mr Collins to the TPB in 2020. That’s three years in the past now.
Three years of steaming manure in its lap and the thought-about people of the TPB in January issued a quiet press launch saying it was sinbinning Peter-John Collins for 2 years for making “unauthorised disclosures of this confidential legislation reform data to companions and workers of PwC” and instructed PwC “to have processes and coaching in place to make sure conflicts of curiosity are adequately managed”.
Like being savaged by a lifeless sheep, as somebody as soon as stated.
Besides that the Australian Monetary Evaluation’s Neil Chenoweth was onto the discharge and knew a scorching story when it was smoking.
Then a curious factor occurred – a really sluggish burn. Chenoweth saved at it and PwC acquired just a few mentions elsewhere, however what was clearly a red-hot problem curiously solely smouldered till being fanned in Senate Estimates on February 15 after which bursting into public flame final week.
Senate Estimates drama
Again with the hounds, Sherlock Holmes’ canine that didn’t bark got here to thoughts watching Senate Estimates on Tuesday: LNP senators appear to have little curiosity in issues PwC.
Certainly, after the Tax Commissioner threw his bombs, Liberal Senator Andrew Bragg went to asking questions on franking credit – not that the LNP must underline its irrelevance.
Not so Labor and Greens, led by Senators Deborah O’Neill and Barbara Pocock respectively.
The previous unleashed beforehand sleepy hounds by tabling the wad of incriminating PwC emails final week, the results of questions on discover she put to the Tax Practitioners Board following the February 15 estimates listening to.
All of a sudden, months and years later, Treasury and Finance have been shocked, shocked, to seek out that playing was occurring in right here.
No, sorry – that was Captain Renault in Casablanca. Treasury and Finance have been shocked, shocked to have their noses rubbed in what the AFR had been writing.
Tardy Treasury response
On Tuesday morning, Senator O’Neill sniffed nearer to the rabbits, in search of a timeline from Treasury Secretary Steven Kennedy about when Treasury first grew to become conscious there was one thing rotten within the state of PwC, that data was being stolen from the federal government, that there was an investigation underneath method.
Dr Kennedy knew such questions have been coming, stated as a lot, had solutions rigorously ready, wording delicately weighed, and a deputy-secretary to entrance the bus for him.
Senator O’Neill ran out of time earlier than exploring in larger tempting element which tortoise discovered what when, however the speedy headline is that Treasury “was requested data” in 2018 about PwC.
That was 5 years in the past.
You may suppose Treasury’s curiosity would have been piqued. Nah.
“We left it to the ATO.”
And the ATO has secrecy necessities – “we couldn’t get extra element … we weren’t capable of ask”.
In the meantime, comfortable relations and large fats contracts with PwC continued.
Secrecy limitations
The ATO itself was smelling a rat a lot earlier – 2016 – and the rat was the home of PwC on the whole and, from 2017, Peter Collins specifically.
However, , secrecy.
Tax Commissioner Chris Jordan railed in Estimates in opposition to the intense secrecy legal guidelines governing the ATO and its authorized lack of ability to mount a legal investigation.
The ATO sought the recommendation of its common counsel and was instructed it couldn’t inform anybody concerning the Peter Collins/PwC outrage apart from the AFP.
Mr Jordan stated that additionally turned out to be the recommendation of the Commonwealth Director of Public Prosecutions and the Australian Authorities Solicitor.
The ATO “shared its data” with the AFP in 2018 and 2019 till it was determined the AFP didn’t have sufficient to launch an investigation.
Faking it?
Treasury now referring the matter to the AFP means both Treasury, the AFP or each are faking it for the cameras.
I’d wager they didn’t guess the ATO would drop them in it.
In 2019 the ATO allotted an assistant commissioner and 20 workers to solely give attention to Peter Collins and PwC.
Over years of authorized battles involving what Mr Jordan known as “extremely formidable if not false privilege claims”, the ATO scored PwC’s inside emails amongst “1000’s and 1000’s” of pages of knowledge.
And all of the ATO’s authorized recommendation ultimately would let it do was hand data over to the TPB in 2020.
Slowly spin the TPB’s wheels – and it’s saying nothing additional now in response to our questions.
E-mail path
In accordance with the ATO, the TPB appeared to accumulate extra “fascinating” PwC emails as there have been emails tabled final week that the ATO didn’t have.
And Senator O’Neill tabled extra emails on Tuesday. A very wealthy one despatched from Peter Collins’ telephone in September 2015 consists of what seems like an automated top-and-tail discover:
“This doc was not meant or written for use, and it can’t be used, for the aim of avoiding US federal, state, or native tax penalties.”
However for avoiding Australian tax, hey, go nuts!
It says partially: “Little actual probability of anti hybrid rule anytime quickly. I spent 3 payneful (sic) hours as we speak. BoT (Board of Taxation) has zero thought. The one factor they get (now) is that it’s sophisticated and maybe we must always not rush. No must share this as a result of all alleged to be secret.”
The e-mail issues an entity domiciled within the British Virgin Islands – the Caribbean tax haven. Mr Collins tells the recipient “The imported mismatch formulation will blow our thoughts however be simple to sidestep.”
And that’s why prime tax companions get the large cash.
The proforma “not for avoiding US tax” sentence is ripe however not the cutest in Tuesday’s tabled emails.
That title goes to a line Senator Pocock seized on: “OK in apply till the ATO will get grumpy and figures out the joke.”
However no hurry, it appears.
The drowsy nature of Treasury is now aided by not answering questions because of the simple excuse of “not desirous to prejudice” the AFP investigation. Handy for all events, that.
Nothing to declare
A Treasury official didn’t know if anybody had instructed the Treasurer of the day something about something.
In fact, there are layers between public servants and their minister.
What a unprecedented factor in a hothouse like Canberra if no one instructed anyone nuffink.
In the meantime, I’m guessing the AFP didn’t have the expertise to go additional with the data supplied by the ATO.
Plod would have needed to rent a Large 4 consultancy to elucidate it to them, in all probability PwC – and it couldn’t do this. Heck, it was already using PwC.
And for all its umbrage and bristling on Tuesday evening about its lack of powers to cope with this scandal, the ATO’s failure was uncovered by Senator Pocock when she requested what the ATO had achieved about that lack of energy, what representations had it made to the Treasurer to acquire appropriate powers?
The reply was that the ATO had not tried.
As Senator Barbara Pocock summarised, there’s a strong case for the referral of this complete case to the NACC.
And there’s extra …
P.S. Late on Tuesday evening the AFP tossed a bunger again on the ATO bomb throwers, suggesting the ATO had solely supplied “a set of consultant pattern paperwork”.
The AFP assertion in full:
- In 2018, the Australian Taxation Workplace (ATO) requested recommendation from the AFP in relation to the potential misuse of presidency data by PricewaterhouseCoopers (PwC)
- The ATO sought recommendation on whether or not there was adequate data to make a proper referral of the matter to the AFP for investigation
- A set of consultant pattern paperwork have been supplied to the AFP. The AFP assessed, based mostly on the fabric that the ATO supplied, was that there was inadequate data within the materials, to assist a proper referral
- In session and settlement with the ATO, the matter was closed in 2019
- On Wednesday, Might 24, 2023, a report of crime was supplied to the AFP regarding this matter for the primary time
- An investigation is underneath method and no additional remark can be made.