MPs under fire for £3bn IT consultancy bill MPs and unions have lambasted the government for spending £3bn on external advice in areas such as IT. Parliament's all-party Public Accounts Committee has hit out at the government's "profligacy" for spending nearly £3bn on consultants, without a clear idea of the benefits. Spending on consultants has risen by a third to …
After David Craig's exposé on how consultancies rape the public sector to line their own pockets and seeing the public figures and failures of government projects with my own eyes, I completely agree with the assessment by the PAC. But does the PAC have the power to do something about it? No. It can only advise, just like the NAO.
Which is completely useless when the civil servants wipe their collective arses on what the PAC and NAO say, and go to the consultants anyway.
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As a contract test manager, I have been involved in a few contracts for government agencies - most recently for VOSA and the Land Registry.
While there is a culture of bringing in independant contractors in lieu of permanent staff as they do not show up in headcounts, have no NI liabilities etc, the vast majority of the money goes to the big infrastructure companies that offer to run all of the government organisations IT for them, including development of new projects.
Unfortunately, the way this usually works is the infrastructure company comes in with a fixed price quote, and then proceeds to deliver utter garbage that, through some strange twist of logic could be said to meet the requirements. The big companies then proceed to milk the government department dry with change requests in order to get the software doing what they wanted in the first place.
One of the worst examples I have ever seen of this was in VOSA, where - in the spirit of "partnership" - they made the head man from the IT outsourcing company (Atos Origin) on site their IT director
Can anyone say "conflict of interest"?
I know someone who has worked as a consultant on the NHS project and from what he says it's no wonder it's failing.
Often the consultants are brought in simply to take the blame. The project manager is still a civil servant and most are incapable of taking any kind of advice. When a technical isue is pointed out that doesn't match the project manager's "vision" the consultant is simply removed from all meetings so that the project manager can stand up and say "everything is going smoothly" while outside the consultant is wondering how the hell he can get off the ship before it sinks without trace.
What can someone employed in the sector do? The moment they blow the whistle they'll be declared unwanted by both their employer and the Government client - nobody appreciates someone talking out of school. Add to that an ineffective NAO and the license to print money and then "employ" the benefactors later remains firmly in place.
I've seen the NAO recently all over a very public IT based project (which was in itself already labelled as a collossal waste of funds - guess who did the feasibility study?), but with school leavers interviewing hardened professionals the results were as expected: nil.
There is, btw, another reason why consultants will never be 'eradicated': the Gov has now so little skilled staff left that the remainder HAS to use consultants in order to (a) get an idea on how to do absolutely anything and (b) have someone to blame if it goes wrong regardless - a good functioning IT project stops a consultancy earning fees!
So a rather strong symbiosis has developed, and it's an addition nigh impossible to break.
Cynical? Yup. Too far fetched? You *really* have no idea..
Currently, government departments have a nice head-count squeeze courtesy of Gordon Brown. This means that you can't employ extra staff.
However, consultants don't count as headcount *and* the money comes from a different budget. Just because they cost more is irrelevant. You've cut head count, cut your salaries budget *and* cut your training budget. You win all round. Oh yeah, except for the public, 'cause the money to pay for consultants comes from the same pot as that to pay for the services we give to the public. More consultants means less money for public services.
At my place, we've got consultants who have been employed by us for years (three or four at least) They openly boast about how much they've made from us. One time it was suggested they become proper members of staff. You can imagine what they said to that. At least we know where we can rent holiday villas & boats from easily...
Another thing, is that as consultants are expensive, they are seen as being more knowledgeable than staff. The truth is that few are. We've paid consultants thousands of pounds a day to come in and do work, make recommendations, etc. We could have done the work to a much higher standard for so much less money. But because we're civil servants, we couldn't possibly know anywhere near as much as these lofty consultants.
I bumped into an old friend from University at one time. She said she was going to America for a few weeks to do consultancy on a telecoms project. I asked her what her experience was of telecoms (My work covers telecoms). She said she'd read up on it on the plane.
There is only one good thing consultants can do: Give bad news. If us mortals tried telling senior managers unpleasant truths, life would be *very* hard for us. If a consultant says it, it is believed (Because they're expensive & more knowledgeable than in-house staff)
I used to be a management consultant at one of the big firms and whenever i spoke to people on government jobs, a few things became clear:
1) None of the consultants on the job wanted to be there - the knew that they were the fall guys for incompetent gov ideas
2) Whenever money saving ideas were proposed by consultants, they were deemed to be bad or unworkable - the Department of Work and Pensions were amazingly lax in terms of expenditure and never wanted to contemplate ideas which could upset the apple cart
3) Nobody in the public sector was ever prepared to make a decision - therefore you take at least twice as much consultant time up (and they are paid by the hour) than you ought to because nobody can commit to anything
4) There is no urgency to get anything done - god knows how the Olympics will work if gov are involved.
It was always seen as decent money (although gov got healthy discounts compared to private sector) but never a pleasure from the consultants on the ground.
"Which is completely useless when the civil servants wipe their collective arses on what the PAC and NAO say, and go to the consultants anyway."
Do you think the Civil Service even at the higher levels suddenly decided to do this? If you do then you credit them with autonomy they do not have. It is the elected Government which is forcing the Civil Service to axe jobs and use consultants. Gordon Brown even has even set targets for amount of private sector (consultants) the Civil Service should be using.
The Civil Service would prefer not to be doing this but they have no choice as the Government controls the budgets and the policy and Gordon Brown wields these two instruments of control without mercy or compassion.
"Unfortunately, the way this usually works is the infrastructure company comes in with a fixed price quote, and then proceeds to deliver utter garbage that, through some strange twist of logic could be said to meet the requirements. The big companies then proceed to milk the government department dry with change requests in order to get the software doing what they wanted in the first place."
This is so true of the Agency I work for and I agree is no doubt standard practice across the industry.
Re consultants, it also rings true of them getting paid 10x (no exaggeration) the wage for civil servants sitting next to them as does giving them project management responsibilities - essentially a blank check book, and in many cases the consultants managing the subcontractors.
I agree that a lot of this is down to employment policy, it starts with the Directors fear of taking on staff for what seems like a short-term project, or fear of lack of expertise so turn to consulting agencies. What inevitably happens is instead of getting rid of them after the planning stage they niche themselves as indispensable and end up running the Agency.
We have recently turned the tables on a group in my dept by direct recruiting of IT professionals and to be honest they are making the consultants look like amateurs. The answer is allowing gov depts the freedom to take on middle management staff and professionals on short term contracts and cut out the middlemen. I honestly don't know how they are allowed to get away with the price they charge through consultancy agencies, and for so long, it really beggars belief.
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