Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

BARBARA POCOCK () (): My question is to the Minister for Finance. ABC's 4 Corners revealed allegations that KPMG has been ripping off the Australian public by submitting inflated invoices and billing the government for hours never worked. Since 2012, one in five government contracts have been varied—never down, always up—by an average of 139 per cent. This massive 'land-and-expand' tactic is straight out of the consultancy profit playbook. Will the government stop the rampant use of 'land-and-expand' by consultants?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I thank Senator Pocock for her question and I acknowledge the work the Senate is doing under the leadership of Senator O'Neill and Senator Pocock in pursuing issues that we've seen this year come to light, led by the PwC-Tax Practitioners Board case and then some of the work that we've been continuing on from that.

I would say that in a general sense there is a heap of work before us around how we rebalance the Public Service away from its over-reliance, dependence and inter-reliance on contractors and consulting companies. I knew it was a problem from opposition. It is worse than I thought when I came into this role and started having a look at it. We have started the work, as you would know, of trying to rebalance that by reducing the budget for a start and by re-employing public servants into roles that we believe should be done by the Public Service on behalf of the people of Australia, not by private consulting companies.

There is more work to be done. I think the area of contract extension or escalation is a real problem. It is one that I had noticed in opposition. There are rules around it that have to be met when contracts are varied, and those processes are outlined under the procurement guidance rules. But I do believe that there is more that we can do in this area to make sure that we are getting value for money, that we're managing those interests between taxpayers' funds and the way we procure services external to government. I think, certainly from my point of view, there is a stack of work under way but we are really only at the beginning of this.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Pocock, a first supplementary?

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

It looks like those rules are certainly working really well for the big four and their bottom lines. 4 Corners also revealed two senior public servants at the ATO, with the ATO's knowledge, continuing to receive payments arising from their previous employment in a big consultancy. Are these the only two, and what steps will you take to end conflicts of interest like these?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Well, I will have to come back on anything further I can in relation to the specific question that Senator Pocock asks. I am not aware of any more but I will come back. In relation to the last part of your question—conflicts of interest—a piece of work assessing it and examining it is underway, about how we manage conflict-of-interest issues across the Public Service in relation to external labour.

There was a number of issues raised at estimates that raised flags with me about arrangements that were in place for some of these companies and other clients they might have but there are also issues we have to look at across the APS. This is something that Finance and I will be working on. But as Senator Pocock will see, we have a comprehensive response to many of those issues as outlined yesterday but there is more work to be done. (Time expired)

Sue Lines (President) Share this | Link to this | Hansard source

Senator Pocock, a second supplementary?

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

PwC has announced that they will no longer make donations to political parties to ensure 'the highest standard of governance'. Will the government follow PwC's lead and support the Greens' bill to ban firms contracting with government from donating to political parties?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

In relation to that question, the position on the private senator's bill, we will go through our own processes in formulating our position on that bill. But I would say again this is something the Greens usually do in their third question—raise the issue of political donations as a way of besmirching, I think, the government without any evidence or anything to back it up. Our political donations are disclosed in accordance with the law. It has nothing to do with procurement across government. The idea that ministers are involved in procurement or doing something—

Hon. Senators:

Honourable senators interjecting—

Sue Lines (President) Share this | Link to this | Hansard source

Order!

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

If you have something to say that proves that, then come forward with it. But you haven't been able to show anywhere where those two things are linked. It's simply incorrect. And if you did have anything, you should send it to the NACC.