PwC doubles Health department work in bumper year of govt contracts


Denham Sadler
National Affairs Editor

PwC more than doubled its revenue from the federal Health department in the last financial year as it cashed in on pandemic work outsourcing, with the global professional services giant enjoying an overall 20 per cent increase in government work.

An investigation of contract documents by InnovationAus has found that PwC earned $228 million from federal government contracts in the 2020-21 financial year, up from $191.9 million in the previous year.

This relates to the actual dollar amount paid to PwC in the financial year, rather than the value of the contracts awarded to the firm in this time.

This equates to an increase of nearly 20 per cent year-on-year in 2020-21, the first full reporting year since the onset of the Covid-19 pandemic, a boost of $36 million in revenue from government work.

This is thanks largely to a large uptick in work from the Department of Health for PwC, with a 113 per cent increase in revenue in the financial year, and a 125 per cent increase in the value of total contracts awarded to PwC by the Department in the last year.

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PwC earned $228 million from federal government contracts in the 2020-21 financial year

PwC was paid $22.17 million by the Health department in the last financial year, up from $10.4 million in the previous year. It was awarded contracts worth a total of $44.6 million in the same timeframe.

The government appointed PwC to be the “program delivery partner for the vaccine rollout” in late 2020, and the consulting firm has now been paid more than $11 million for this work on the troubled rollout.

PwC also landed a number of lucrative contracts with the Department of Defence and Services Australia in the last financial year.

These include a contract with Defence running for only 61 days of the 2020-21 financial year worth nearly $1 million.

PwC also scored just under $1 million for two months’ work providing labour hire to Services Australia last year, and a further $676,000 over 55 days to complete market research for the department.

In the last financial year the consulting giant was also awarded a six month contract with the tax office worth $2.7 million.

PwC’s good run with the federal government has continued into the current financial year, with the consultancy landing a number of new contracts, particularly with the Industry department.

It was revealed earlier this month that PwC had been paid $105,000 in a fortnight to supply six staff to the Department to assist with assessing grants as part of a “surge capacity”.

PwC has been paid more than $5 million in this financial year for reviews and reports to the Industry department, leading to concerns from the federal Opposition over the “privatisation-by-stealth” of the Department.

InnovationAus.com analysis has also revealed that Boston Consulting Group more than doubled its revenue from federal government business in the last financial year, up $39 million compared to the previous financial year.

In the same time, fellow big four consultancy McKinsey increased its revenue from Commonwealth contracts to $58.6 million, an increase of more than 75 per cent.

InnovationAus.com has taken all of the contracts active during the 2020-21 financial year reporting period to conduct this analysis. For contracts which ran over more than one reporting period, the total contract value was divided by the total number of days in the contract to get the per-day value of each contract.

InnovationAus.com then calculated how many days each contract was active in a particular reporting period and multiplied this by the per-day value of the contract.

The current system of contract disclosure is opaque and difficult to track. The methodology used by InnovationAus.com is a better indicator of the growth in the use of multinational management consultants and Big Four tech service delivery firms than the government provides.

Do you know more? Contact James Riley via Email.

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