KPMG Scandal Threatens Big Four Dominance in Australian Government

New business revenue for KPMG, PwC, Deloitte, and EY from the federal government plummeted to A$348 million in 2025, down from A$637 million the previous year. This sharp decline follows allegations that KPMG shared confidential client information to secure auditing work. The firm has since seen the departure of its CEO and top auditor, while the government has barred it from bidding on new federal projects until September 30.

KPMG currently holds approximately A$650 million in active contracts. Experts suggest that if the allegations of misconduct are substantiated, the firm could face a trajectory similar to PwC, which sold its government advisory arm for A$1 after a 2023 tax policy leak. Former Department of Finance official Stephen Bartos noted that agencies are increasingly wary of potential conflicts, a sentiment mirrored by the Reserve Bank of Australia’s decision to reconsider its relationship with the firm.

Legislators are now pushing for stricter oversight. Greens senator Barbara Pocock has called for the breakup of these partnerships, arguing they have lost their social license. While parliamentary inquiries have proposed capping partner numbers and banning the dual provision of audit and consultancy services, these recommendations remain unimplemented. Conservative senator Richard Colbeck confirmed that departments across the board are actively auditing their current exposure to KPMG, signaling a broader market shake-up.