PwC to hike partner pay packages to record highs
PwC’s Edinburgh staff are based at Atria One
Britain’s biggest accountancy firm, PwC, is expected to hike average partner pay by a fifth (19%) on the back of record profits generated by a rise in demand for its services during the pandemic.
The average payout to about 900 partners for the year to 30 June is forecast to hit £818,000.
PwC’s annual results are not due to be announced until September but sources say partners are also in line for an average payout of £50,000 generated by the sale of its technology platform and several other smaller disposals, according to Sky News.
Despite initial fears about the impact of COVID-19 on the professional services sector, the ‘big four’ auditors – Deloitte, EY and KPMG – have largely managed to weather the financial storm.
PwC did not make any redundancies as a result of the pandemic, and did not take any government money through the furlough scheme.
In April 2020, just after the UK first went into lockdown, the firm imposed a freeze on promotions, pay rises and staff bonuses. It employs about 22,000 in the UK.
Its recovery from last year’s fall in profit is largely said to have been derived from consulting work for private sector clients rather than work for the government.
It has maintained market share in its audit practice while handling a number of prominent corporate restructurings such as those at Laura Ashley and Paperchase, the high street retailers.
PwC also won dozens of public sector contracts to help Whitehall deal with the economic chaos caused by the pandemic, including from the Cabinet Office, Treasury and Department for Digital, Culture, Media and Sport.
However, there could be a backlash at a time when the audit profession is being reformed because of its failure to spot big corporate collapses.
The big four audit firms have together been fined tens of millions of pounds in recent years for high profile failures, with PwC being penalised over its work at companies such as BHS and Redcentric.
The Financial Reporting Council has begun imposing tougher restrictions on the consulting work that big four firms can undertake for audit clients, while ‘challenger’ audit firms such as BDO and Grant Thornton will have a greater chance to work on the audits of Britain’s biggest companies.