The Murray-Darling Basin Authority has written to PricewaterhouseCoopers seeking assurances that confidential information contained in audit and river modelling contracts worth more than $28m has not been shared.
PwC holds the $775,000 three-year contract to audit the MDBA, ending on 30 June this year. It was also awarded a major contract to streamline river models on to a single platform.
The four-year “integrated river modelling uplift program” contract is worth $27.417m. PwC also won a related but separate contract around the cloud computing platform Microsoft Azure, worth $167,700.
The MDBA chief executive, Andrew McConville, told Senate estimates that PwC had confirmed that there were practices in place to ensure the confidentiality clauses were met across both contracts.
“It’s important to note, also, that we’ve recently reached out again to PwC, seeking assurances, and they’ve been provided to us in terms of the controls and practices that they have in place to ensure that our services have [not] been affected, and that our confidential information is not and has not been involved or compromised,” McConville said.
But PwC’s assurance has also been referred to the MDBA’s independent audit committee for review.
“Referral to the MDBA’s independent audit committee for consideration at its next meeting is an entirely normal step in such circumstances,” McConville said.
Asked whether the MDBA would seek to reconsider its contracts with PwC if the independent audit committee was concerned, McConville said “any next steps regarding engagement with PwC will be considered carefully”.
“No decisions have been taken,” he told Guardian Australia.
McConville said the MDBA’s independent audit committee was “entirely separate” to PwC’s role as the authority’s internal business auditor.
“The MDBA has sought and obtained assurances from PwC in relation to the integrity of the contract to deliver this internal audit service,” he said. “This contract is entirely separate to the independent audit committee (which is independent of the MDBA and PwC) and entirely separate to the Integrated River Modelling Uplift contract.”
PwC did not respond to specific questions regarding the MDBA contracts.
The company is facing multiple investigations, including a referral to the Australian federal police, after its now former international tax chief Peter Collins allegedly used confidential information and documents obtained through his work for the government for the firm’s commercial gain.
In an open letter its acting chief executive, Kristin Stubbins, apologised on behalf of the company and for “betraying the trust placed in us”.
She said PwC Australia had commenced a process to “ring-fence the provision of services to federal government departments and agencies to enhance our controls to prevent conflicts of interest”.
Stubbins said this would include separate governance and oversight arrangements for the business by the end of September, covering all services to federal government departments and agencies.
The Nationals senator Ross Cadell raised the river modelling contract at Senate estimates, citing “concerns around PwC and the broader aspects of confidentiality”.
“Are there clauses in this [PwC] contract, or is there any sensitive data with which we’re concerned about confidentiality leaking into market, or anything like that?” he said.
MDBA’s Andrew Kremor told estimates the river modelling contract included “additional confidentiality requirements … as well as other assurances to do with sensitive market information”.
Kremor said the MDBA did not have the expertise to unify 24 river models into a single platform.
The MDBA chief operating officer, Annette Blyton, said the Australian National Audit Office had flagged a review of the river modelling contract in its draft plan for 2023-24.
“They need to halve the audits that they’ve got on that plan, so it may or may not proceed,” Blyton told Senate estimates.
The South Australian Greens senator Barbara Pocock said the MDBA should “take whatever action is open to them to ensure that the terms of the contract are being met”.
“PwC has its tentacles in so many areas of government work it’s like a shadow government. I think there needs to be a thorough examination within each department and agency of all their contracts with PwC to determine identify potential conflicts of interest and take action to ensure confidentiality, and that includes the MDBA.”
