Government racks up £11m consultancy bill in six months

Tuesday 10 December 2019

The government has racked up a bill of more than £11m on consultants in just six months, new figures have revealed.

The spending in the first half of this year was documented in a detailed report, which broke down the expenditure as follows:

• Consultancy services provided by a supplier (£7,155,140)
• Consultancy services provided by a specific individual (£ 4,087,681) 
• Fixed-term employees, collated by department, for individuals paid at or 
• below the Civil Service grade 15.4 salary (£7,048,029) 
• Fixed-term employees, paid above the Civil Service grade 15.4 (£590,395) 
• Local agency staff, collated by department (£3,392,856) 
• UK Nursing agency cost (£2,484,101) 
• Social worker agency cost (£823,501) 

The first of its kind, the report was released this week following a successful bid to make the government more transparent by Deputy Kirsten Morel.

In July, he put forward legislation to ensure reports are published twice a year on consultants' pay, which was unanimously approved by politicians and lauded for its aim to remove "suspicion, rumour and concern" at a time when there had been much criticism of the rates paid out to those assisting with implementing the Chief Executive's 'OneGov' programme.

Pictured: Deputy Kirsten Morel.

Among those under fire at the time was the Chief Operating Officer's department, which defended its £350,000 spend on accommodation and flights for temporary staff over a period of 18 months, claiming there was an urgent need to plug "significant gaps in capacity and capability".

The latest figures, however, suggested that the department was still in need of significant assistance, holding the most contracts with consultants - 15 with suppliers, and 30 with individuals. The highest paid of the latter category was an 'Interim Chief Information Officer' (£175,000 - £200,000), whose contract is expected to end in January 2020.

The highest consultancy spend overall was listed as EY, which was awarded a £2m contract to work on the government's 'Modernisation and Digital Transformation Programme'.

A trend of high spending on temporary health staff, which Express revealed had rocketed to £9m in three years earlier this year, appeared to continue, with nearly £2.5m spent on UK nursing agencies alone.

Pictured: UK nursing agency spend remains high.

In its report, the government justified the use of contractors as being necessary in instances where the relevant skills were not already present within the current staff body or where departments were suffering with understaffing.

However, it explained that there had been efforts to "break the dependency" on agency staff within nursing, teaching and social work, where it said "vacancy rates have been historically high".

"For instance, the ‘Let’s be Honest’ campaign launched earlier this year has so far recruited 22 permanent social workers to work in Jersey – many from the UK, but some agency staff applied to become permanent," the report read.

It further added that particularly high costs usually resulted from a number of factors:

• Agency fees are often charged on top of the contractor's own cost.
• The contractor (when self-employed) needs to factor in employer social security, pension and tax costs, and a premium to cover work insecurity (they might be out of work between contracts and are unpaid for sickness absence or holidays).
• Competition with other organisations for scarce skills pushes up the market price for contractors.
• The additional cost of travel and accommodation for contractors working away from home.

But it defended the costs, noting: "...These costs need to be compared with the opportunity cost of not doing the work they are brought in to do – whether care for patients and vulnerable people, educating our children, or delivering transformation that will improve services and reduce future costs. In addition, where contracts are of short duration, and the roles are not ongoing, and there is no-one in the organisation with the skills to do the work, there is no alternative."

It added that many of the contracts listed in the report "are either ending or not being extended" and that the number held was therefore "expected to significantly decrease" in the coming months.

Only seven company contracts are due to be extended, while 42 come to an end, while only 15 individual contracts will be extended as 49 end.

CLICK BELOW to read the full report...