Two private companies, Telco Services Australia (TSA) and Recoveriescorp, which hold significant government contracts with agencies like Services Australia and the Australian Taxation Office (ATO), have reported no corporate taxable income in recent years despite generating substantial revenues. Separately, Telco Services Australia faces allegations from current and former employees regarding fabricated performance data, concealed privacy breaches, and worker welfare concerns, all of which the company denies. These situations have prompted calls from advocacy groups for increased transparency and stronger tax compliance thresholds for government contractors.
Despite generating substantial revenues and holding major government contracts, two private companies, Telco Services Australia and Recoveriescorp, have reported no corporate taxable income in recent years.
Financial Reporting and Tax Practices
Telco Services Australia (TSA)Telco Services Australia, an operator for Centrelink call centres, reported no corporate taxable income for several years, including the 2024-25 financial year and the year prior. During these periods, the Perth-headquartered company generated over $185 million in revenue in 2024-25 and $130 million the preceding year, while holding a multi-year government contract valued at over $90 million with Services Australia.
Financial documents filed on December 24 show $166.5 million in related party transactions for Telco Services in the last financial year. Jason Ward, a principal analyst at the Centre for International Corporate Tax Accountability and Research, stated that these payments appeared to "virtually eliminate profits" for the company, resulting in no tax payable. Financial documents also indicated that payments for directors and key management personnel increased during the 12-month period when the company reported a financial loss.
A spokesperson for TSA Group, the parent entity, stated that while Telco Services itself did not record taxable income, "other associated entities did and the appropriate amount of tax has been paid by them." The spokesperson added that a large, independent auditor had assessed the taxation arrangements and payments. They noted that the entities which paid the tax were not subject to public reporting requirements and that Telco Services had paid tax in previous years. TSA described the related party transactions as costs for services provided by associated companies, which are simultaneously recorded as revenue by those associated companies. There is no assertion that the company or its directors engaged in illegal activities.
Recoveriescorp"Other associated entities did and the appropriate amount of tax has been paid by them," a TSA Group spokesperson stated regarding Telco Services' lack of taxable income.
Recoveriescorp, a private debt collection company, has also reported no corporate tax liability despite securing significant contracts from the Australian Taxation Office (ATO). Its parent entity, Symbos Bidco, recorded over $100 million in revenue during 2025. Financial records for Symbos Bidco indicate substantial income streams but also large business expenses, including high consulting fees and elevated interest repayments to unnamed financiers. These expenses have led to a series of annual losses, resulting in no corporate tax liability. Mark Zirnsak from the Tax Justice Network Australia raised questions regarding the company's loss-making status.
A Recoveriescorp spokesperson stated that the business and its parent are "fully compliant with their tax and regulatory obligations," attributing the financial structure to reinvestment during a growth phase. Recoveriescorp is a key subsidiary of Symbos Bidco and is ultimately controlled by the private equity firm Allegro, which acquired the company in 2024. Symbos Bidco reportedly paid advisory services fees to its auditing firm, a practice that a recent parliamentary committee recommended against.
The company also holds significant loan facilities, including a nearly $58 million loan at an interest rate exceeding 7% and an $86 million loan from a related party. Recoveriescorp did not provide specific reasons for these loans or the use of a combined firm for audit and advisory services when questioned. The ATO declined to comment on the specific tax affairs of Recoveriescorp or its parent company, citing confidentiality laws.
Recoveriescorp, a private debt collection company, reported no corporate tax liability despite over $100 million in revenue, attributing its loss-making status to significant expenses and reinvestment during growth.
Government Contracts and Reliance on Outsourced Services
Telco Services Australia operates call centre services for Services Australia, the agency overseeing social security, and also holds contracts with the ATO and the National Disability Insurance Agency. The staff handling the Services Australia contract are employed by Trimatic Management Services, a separate entity that received $5 million in grant funding from the Western Australian government in 2024 to expand call centre jobs.
Recoveriescorp has been awarded $42.8 million in contracts by the ATO since 2022. Between January 2024 and October 2025, the ATO referred more than 355,000 taxpayers to Recoveriescorp. Recoveriescorp staff have operated within ATO offices for several years, with services expanding to include offsite debt collection on the agency's behalf.
Government agencies, including Services Australia and the ATO, utilize a mixed workforce of permanent public service staff and contractors. Other outsource operators such as Concentrix, Probe Operations, and Serco also hold contracts with these agencies. The increasing reliance of government agencies on outsourced call centres has been noted, with previous attempts to reduce this reliance having stalled. A majority of calls to the Australian Taxation Office's phone lines are answered by staff from private operators.
The increasing reliance of government agencies on outsourced call centres for critical services like social security and tax collection highlights a broader trend, with a majority of ATO calls now handled by private operators.
Allegations Against Telco Services Australia
Current and former workers have accused Telco Services Australia (TSA) of pressure tactics leading to fabricated performance statistics and concealed privacy breaches involving Centrelink customers. TSA strongly denies these allegations.
Privacy Breach ClaimsA former senior staff member at TSA reported being instructed to investigate privacy breaches where callers accessed other individuals' information by impersonating Centrelink recipients. This individual claimed that their supervisor frequently requested specific incidents be classified as non-breaches, contrary to internal guidelines, in order to protect the company's contract.
Another current TSA worker indicated that many privacy incidents occurred during the 'nesting' period, when new recruits begin taking calls after classroom training. This worker alleged that these incidents were often handled through one-on-one conversations with team leaders rather than being formally recorded as privacy incidents, citing insufficient prior training as a contributing factor. Time pressures related to call handling key performance indicators (KPIs) were also noted as a disincentive for workers to self-report breaches.
TSA stated that privacy is of high importance, with internal standards often exceeding regulatory and client requirements. The company also mentioned having a dedicated compliance department for monitoring and addressing breaches, including escalation to clients.
Performance Statistics Allegations"Many privacy incidents occurred during the 'nesting' period," a current TSA worker alleged, claiming these were often handled informally rather than being formally recorded to protect the company's contract.
Allegations also include claims that some managers were instructed to review multiple calls from underperforming staff until a suitable call could be identified and marked as a 'pass' during quality assessments. This practice reportedly compromised assessment results, as assessors were expected to evaluate the first call listened to. The former employee stated that many KPIs reported to stakeholders are "manufactured," with incidents not being recorded, and statistics fabricated to maintain the contract. A TSA spokesperson confirmed that the company regularly assesses calls through its supervisors, third-party assessors, and government agency clients.
A former employee claimed that "many KPIs reported to stakeholders are 'manufactured'," with incidents unrecorded and statistics fabricated to maintain the contract.
Worker Welfare and Industry Concerns
Current and former TSA employees raised concerns about worker welfare, alleging that the company penalizes staff for taking sick leave and does not provide adequate breaks. The company encourages employee attendance for service delivery but acknowledges the need for sick or bereavement leave. Some employees claimed they were denied a $500 bonus, advertised for new recruits passing a three-month probation, due to taking sick leave within their initial months, stating this condition was not disclosed beforehand.
Reports from staff at outsource call centres for agencies like the ATO and Centrelink have cited issues with training, morale, and high attrition rates. High staff turnover is common in outsourced call centres for government contracts. A 2025 report by the tax ombudsman found that only 44% of call staff at the ATO's outsourced operators had been in their roles for over 12 months, which is lower than the public service average. One former worker cited declining mental health as a reason for leaving, mentioning anxiety related to job conditions, including strict rules on bathroom breaks.
The tax ombudsman has also reported an increase in complaints regarding the ATO's use of third-party collectors for tax debts. Reports indicate that outsourced workers generally experience lower pay, fewer protections, and fewer career opportunities compared to those in the public service.
"Only 44% of call staff at the ATO's outsourced operators had been in their roles for over 12 months," a 2025 tax ombudsman report found, highlighting high attrition rates in government contract call centres.
Government Oversight and Calls for Transparency
A Services Australia spokesperson affirmed that the agency rigorously monitors contractual compliance, including adherence to all relevant laws and regulations. The spokesperson stated that substantiated breaches lead to appropriate contractual action, which could include termination in serious cases. Services Australia conducts regular site visits, monitors performance through call listening, observes training, and delivers feedback sessions to ensure compliance and consistent customer experience. The ATO affirmed its adherence to commonwealth procurement rules.
An analysis of TSA Group's structure revealed that its various businesses infrequently lodge public financial accounts, making it challenging to publicly verify the group's total tax payments or the flow of related party transactions among entities. Another operational arm, Telco Sales, which holds a contract with Telstra, paid approximately $700,000 in corporate tax in 2022-23 and received a partial refund the following year, having generated over $120 million in revenue during those two tax years.
The Tax Justice Network Australia advocates for stronger tax compliance thresholds for companies seeking government contracts in Australia. Jason Ward also advocated for increased transparency for companies bidding on public contracts. These situations mark instances where private equity-backed companies holding major government contracts have reported financial losses and no corporate tax payable.
Advocacy groups are calling for increased transparency and stronger tax compliance thresholds for government contractors, particularly for private equity-backed firms reporting losses despite significant public contracts.