Treasury Laws Amendment (Strengthening Accountability for Tax Adviser Misconduct and Other Measures) Bill 2026

Senator BARBARA POCOCK (South Australia) (12:12): I rise to speak to the Treasury Laws Amendment (Strengthening Accountability for Tax Adviser Misconduct and Other Measures) Bill 2026. I'll be speaking in particular to schedule 1, which solely relates to reforms to the Tax Practitioners Board. The Greens support the strengthening of the Tax Practitioners Board and stronger penalties for tax adviser misconduct.

We recognise the good work of many people in the TPB. The PwC scandal would not have surfaced if not for the diligence and the determination of the TPB, in particular, Mr Michael O'Neill, who was tenacious in his tracking down and bringing into the public view a range of scandals and their concealment. The TPB was crucial in acting against former PwC partner Peter-John Collins for his rotten and dishonest behaviour.

Mr Collins monetised confidential government information to help some of the world's biggest multinational companies avoid tax, earning at least $2.5 million in revenue for PwC as a result. At its core, the PwC tax leaks scandal was not a story about one individual behaving badly. It exposed the ability of a powerful consulting firm to gain access to confidential government information about future tax policy and then use that information to profit its multinational clients.

It's a story about greed. It's about a business model where greed, deception and corruption trump ethics and decent behaviour at every turn. This is one of the most egregious breaches of public trust in recent memory but it's far from the latest or only scandal in this sector.

As I said in my additional comments to the first consulting inquiry's report in 2024, the scandals in this sector are frequent. They are global in nature and many never see the light of day, so I want to acknowledge again the journalists who have worked very hard over recent years to uncover sin after sin within the rotten consulting sector and the big four, as well as the whistleblowers, without whom these scandals would never have come to the attention of our two consulting inquiries.

I want to acknowledge the contributions of Senator O'Neill, Senator Scarr and Senator Colbeck to the two consulting inquiries. They worked together to bring to the attention of the parliament and the public the nature of the litany of disasters—conflicts of interest, appalling governance, ethical failures, state capture and regulatory weakness—that have unfolded across the larger consulting sector and parts of the public institutions that deal with it.

The ongoing KPMG scandal is a story about not one mistake or one individual exercising poor judgement but a laundry list of people and repeated instances of unethical governance and accountability failures, years of cover-ups and aggressive resistance to telling the truth. KPMG's sins are multiple in our most recent experience. Senior partners have been misusing confidential client information to win extremely lucrative audit work.

We've seen breaches of audit independence and multiple instances of cheating on internal exams. We've seen examples of lying to the Senate about the firm not power mapping to really expand their footprint within the public sector they're consulting in, when in fact they did and continue to do that practice. We've seen them overcharging Defence while raking in billions of dollars.

We've seen mistreatment and harassment of multiple whistleblowers, including Brendan Lyon of the TAHE matter in New South Wales and the more recent experience of a brave new whistleblower and other whistleblowers who are making contact with senators regularly, queuing up to bring forward new and other disasters, both in KPMG and across the big four. We've seen people attempting to use legal professional privilege to obstruct and slow the work of this parliament and regulators.

We've seen failure to notify corporate clients and the Department of Finance of recent developments and incidents, as required by contractual obligations. The list is long, and it goes on. While we welcome measures like these in this bill to strengthen our regulators, we know we need bigger and bolder structural reform.

Schedule 1 of this bill will give the TPB a greater range of options when responding to tax adviser misconduct. These sanctions are really important. We know that, despite being a frontline regulator, the TPB does not currently have the same powers and regulatory tools as other regulators like ASIC.

The independent James review commenced by the former Liberal government in 2019 found that the TPB could only apply relatively minor sanctions, such as written cautions, or high-level sanctions, such as suspension, termination of registration or civil penalties. What's missing is a proportionate range of tools in between, which this schedule fixes. The bill introduces new criminal and civil penalties and gives the TPB the power to issue infringement notices and accept enforceable undertakings.

It also increases the amounts of existing penalties and introduces interim suspension measures for egregious breaches. It extends the prohibition period from five years to 10 years following the termination of registration for misconduct. The Greens support these measures because deterrence really matters.

If a consulting firm can make millions—indeed billions—of dollars from misusing confidential government information while facing only a relatively small regulatory penalty, then the penalty is no deterrent; it's the cost of doing business. These changes also have wide support from stakeholders. There's broad consensus that the TPB needs stronger enforcement powers.

CPA Australia have said that this is a balanced approach that strengthens confidence in the tax system while protecting ethical practitioners. They said it would have little impact on those who are ethical and compliant. The TPB has said that, following the passage of legislation, they will undertake further consultation on guidelines and administrative policies.

Many of these recommendations came from the independent James review of the TPB and the Tax Agent Services Act, but this report made its recommendations six years ago. The report predates the PwC and the KPMG scandals. It's taken a long time to get to this point where we are today, and there is still a lot more to do.

Here we are legislating some of the basic tools that a modern regulator should have possessed in the first instance. We support increasing the penalties available where people deliberately undermine the integrity of our tax system, but the job doesn't stop there. We know the TPB is an important regulator, and these are welcome changes, but it's nowhere near enough to address the core problem here.

These reforms are a step forward, but they are modest in their scope and size in response to multiple mass scandals that expose something much bigger, a fundamental problem with corporate power, regulatory capacity and accountability in Australia, especially in relation to the big four. Australians were outraged by the PwC and the KPMG scandals, and they expect parliamentarians in this place to take it seriously, and we are.

It's good to see that the government is considering options to reform the accounting, audit and consulting sectors and that they've brought forward an options paper, but this options paper was largely written before the most recent KPMG scandal, and it narrowly focuses on audit, leaving the broader issues for the big four around their multidisciplinary, very broad based activities outside it.

Hopefully we don't spend too much longer trying to get action on those issues and the broad range of services, behaviours and business models of the big four. We need to see faster action. PwC and KPMG scandals have united the parliament, and two major inquiries have made multiple clear recommendations for reform.

Reform needs to be driven by the public interest, not by what's easiest or acceptable by the big four in terms of accommodating change. The big four have lost their social licence in Australia, and the government should be using this as an opportunity to make ambitious structural change. The big four have shown Australians who they are and the main forces that create their business model.

Last Friday, ASIC told the joint corporations committee, which Senator O'Neill chairs, that they have identified 551 internal complaints about audit and related misconduct at the big four firms over the last three years. There is a lot of water to flow under the bridge as these internal complaints, 500 of them across the big four, are investigated for what they did, what they mean and who they have affected.

This is an astonishing number. What will they reveal as they are closed down and investigated? How many more scandals do we need before we see real action by Labor to limit and control the broad scope of big four activities?

The big four dominate our economy. They are the parents of privatisation. They have driven so much change in our institutions, our health system, our education system, our universities and the way our public sector works, yet they have much weaker transparency and accountability than big corporations.

It is time to end their special treatment. Australia needs a strong, independent and trusted audit assurance and professional services sector. We know that self-regulation has failed and that the big four cannot be trusted, so we need to do a few things in my view.

Firstly, we need to end the licence of self-regulation for the big four. We need to have a similar regulatory body on the beat for audit just like the TPB. Secondly, we need to separate the conflicts that are inherent in running a business that does audit, tax and consulting for individual clients.

There is too much farming opportunity for business, which is unethical and compromises the integrity of audit. Thirdly, we need to renovate the governance of these large corporations. At present they have a bunch of cosplay 'directors' who they term independent but in fact, as we have recently seen in KPMG, are not actually pushing for independence of governance in any way.

We need public disclosure requirements, we need a strong whistleblower obligations, and we need the same taxation obligations for the big four as large corporations in our country face. We need to see real consequences for audit misconduct, and we need to make sure we look after whistleblowers across the big four. Finally, we need to make sure that they have the same insurance and liability responsibilities as other players in the field and that there's a level playing field in relation to insurance for liabilities.

Finally, there's a lot to do in the field of consulting. We need to regulate consultants, we need to debar those who practise poorly or breach guidelines and protocols, we need to target a fall in consulting by federal government, we need to ban political donations, and we need to do something about the revolving door which sees politicians go so profitably from inside this chamber to outside, advising very, very significant contracts, not least in Defence.

We need to remove the special treatment of partnerships in this country. How much evidence does this parliament need, does the Labor government need, to take real steps which make a difference and break the model of agreed lack of transparency that we see in the big four? The big four are critical to auditing the largest companies in our country yet are not subject to the same transparency, reporting, tax and whistleblowing obligations as those big corporations.

So the question for me now is: having assembled, and in continuing to assemble, the evidence, what will this parliament do, what will this government do, to meet the incredible outrage across our Australian community, to reel in the big four, to regulate them, to root out their destructive and very, very costly impact on our public services? The Greens support the measures in this schedule.

We've previously supported reforms to the TPB, and we secured an amendment to the previous bill that banned partners from the big four firms from sitting on the board. This is very, very important, but we all continue to push the government to go further. We want to protect those whistleblowers.

We need a comprehensive response to the consulting sector's failures rather than a series of narrowly targeted legislative amendments that leave the underlying concentration of power in these very large partnerships. These reforms are a good step forward. They close some gaps by increasing penalties and increasing accountability.

But it does not guarantee that another scandal cannot happen. It doesn't guarantee that, and how many of these scandals are we going to have to put up with before we see action? We need to see transparency, we need to see strong regulators and independent oversight of these places, these partnerships, and, above all, what we need to see is the political courage to stand up to these very powerful vested interests, who are present at every table of influence around our country and, too often, in our parliament.

The lessons of the PwC and KPMG scandals are that we can't stop here. We need a tax, auditing and consulting sector that's fair, transparent and rigorously enforced. Australians want regulators that are strong enough and bold enough to take on the big end of town.

It's time for Labor to act.