The finance department has entered into a $32,000 contract with an external consultant to provide advice on how it should engage other external consultants who also provide advice to government, in a move that has been slammed as a “laughable scenario”.
The contract has been compared to an episode of the ABC satire Utopia and as an example of the public service’s reliance on external expertise, even as the federal government tries to save money and do more work in-house.
The finance minister, Katy Gallagher, has confirmed Simon Longstaff, the chief executive of the Ethics Centre, has been hired to help the department decide how to best engage with consultancy firm PwC Australia and its new spin-off company, Scyne.
Longstaff is a well-respected philosopher and ethics adviser whose organisation reviews workplace culture and delivers “capacity-building programs for good decision-making”. The centre is a registered charity.
But the Greens senator Barbara Pocock, who is part of a parliamentary inquiry examining the conduct of consultants, questioned why the government was “relying on third parties to make critical policy decisions”.
“Just imagine a bureaucrat in the finance department saying ‘We need to hire a consultant to advise us on how to hire consultants’. The scriptwriters from the ABC’s Utopia series couldn’t have come up with a more laughable scenario,” Pocock said.
“I’ve got nothing against ethics expert Simon Longstaff but surely we have some measure of decision-making capacity left within the public service that would allow us to do this job in-house. Do we really have to look outside the public service for moral guidance on how to deal with consultants?”
Longstaff’s engagement was confirmed by Gallagher in response to a letter from Pocock, who raised concerns about PwC staff being transferred to Scyne. The new company is founded by Allegro Funds, which acquired PwC’s government services division for $1.
“My department is engaging with PwC Australia and Scyne regarding its structure and future operations to ensure the government can have confidence in any future work it delivers,” Gallagher wrote to Pocock.
“To assist those assessments, Finance have engaged an ethics advisor, Dr Simon Longstaff AO, chief executive of the Ethics Centre.
“The government will take further action, as required, pending the findings and recommendations of the current parliamentary inquiries into the consulting industry.”
A finance spokesperson confirmed the Ethics Centre would be paid $32,000 for the advice and said Longstaff had “significant knowledge and expertise in the field of ethics”.
“Longstaff’s experience and expertise is supplementing the expertise that the commonwealth has in considering matters of this nature, including in relation to the appropriate action that may be taken,” the spokesperson said.
“Finance’s examination will form a view whether Scyne and PwC Australia have appropriate culture, governance, and accountability frameworks in place to contract with the commonwealth.”
Longstaff and the Ethics Centre were contacted for comment.
Gallagher has previously described the public service’s reliance on consultants as worse than initially expected, but maintained there was still a place for expert external advice.
Both PwC and Allegro Funds are investigating all staff who are transferred to the new company, Scyne. Last week, the new company’s non-executive director, Andrew Greenwood, told the Australian Financial Review that staff must meet a higher level of ethics and integrity.
PwC’s former acting chief executive, Kristin Stubbins, told a NSW parliamentary inquiry in June that no one involved in the confidentiality scandal would be transferred to the new company.
But Pocock has raised concerns that the new company, Scyne, will not be substantially different to PwC Australia given the majority of the staff will be transfers.
“It seems that it will be impossible to obtain meaningful guarantees regarding the new firm’s culture and business practices,” Pocock wrote in her letter to Gallagher.
“Despite Scyne Advisory’s assertions about their governance structure, the available evidence points to a repetition of an opaque partnership that served to shield PwC from accountability.”
