Senior officials at embattled consultancy PwC were not aware for almost a year its Australian head had a $1.2 million salary top up, an inquiry has been told.

PwC executives appeared before a parliamentary inquiry on Friday into ethics in the sector, prompted after revelations PwC’s partners had passed on confidential Treasury tax information to boost private sector business for the firm.

The inquiry was told PwC’s chief risk officer Jan McCahey did not know for nearly a year the Australian chief executive Kevin Burrowes received $1.2 million extra from PwC’s global headquarters on top of his $2.8 million salary.

Mr Burrowes was named as chief executive in July 2023 following the Treasury scandal, but it wasn’t until June 2024 that Ms McCahey was told about the top up in pay.

“I wasn’t aware of it … I was surprised to learn of it at the time,” Ms McCahey told the inquiry.

“(When I found out) I can’t remember what I said. I was surprised.”

Mr Burrowes said while the salary top up was disclosed to the firm’s board, its risk officer was not told.

But Labor senator and inquiry chair Deborah O’Neill said, with the payment, Mr Burrowes could be seen as “serving two masters”.

The chief executive said PwC had made progress in the past year since taking the job at the firm.

“The firm was very stressed when I arrived. We had to take some very significant actions, such as selling our government consulting business for $1,” he said.

“That’s some of the actions we’ve been taking to make sure that the firm thrives again in the future.”

The inquiry will later hear from former chief executive Tom Seymour, who led PwC from 2020 to 2023 and was linked to the tax scandal.

Five months after news of the scandal broke, Mr Seymour confirmed he had received emails relating to the information, apologised and stepped down.

Former Telstra boss Ziggy Switkowski, who was appointed to lead an independent review into PwC’s Australian operations, will also appear at the Senate inquiry.

Senator O’Neill said Australians deserved the truth.

“Until the air is clear around this, there is a cloud hanging over PWC,” she told ABC Radio.

“I don’t think I have confidence that any of the major consultancy companies are as forthright or accountable to the Australian people as they need to be.”

Asked about the government’s continued reliance on outsourced consultants, she said it was transitioning to a new model and rebuilding the public service.

This post was originally published on Michael West.