18 November 2010 | Angeline Albert
The UK government is unable to measure whether it gets value for money from consultants, the head of the civil service told a Committee of Public Accounts meeting yesterday.
The Cabinet Office came under fire following a report published by spending watchdog the National Audit Office in October, which said the government showed a lack of intelligence in its use of consultants.
Responding to criticism that central government’s use of consultants demonstrated “poor value for money”, cabinet secretary Sir Gus O’Donnell told MPs: “It’s always going to be very hard to measure value for money because you can measure the inputs but not the outputs. I can’t measure the impact of what consultants deliver.”
Ian Watmore, chief operating officer of the Efficiency and Reform Group (ERG) - which includes the OGC and public sector procurement agency Buying Solutions, and is part of Cabinet Office - sat next to O’Donnell as they faced a grilling from the PAC.
Margaret Hodge, chairwoman of the committee, highlighted another criticism in the report when she said: “Departments are hiring consultants without even knowing if they’ve got available in-house staff.”
The NAO estimates that, in 2009-10, central government spent £1.5 billion on consultants.
Watmore listened as Hodge said some government departments didn’t know how much was spent on interim consultants and others were unclear what level of seniority they had. One committee member described what they saw as a “black hole” in data on consultants.
Several committee members said too few departments were able to provide details on categories of spending on consultants, with more than a third remaining uncategorised. They wanted to know when this would change.
Watmore, replied: “In the new financial year, [April 2011] we will get management information [on consultant spending] flowing.”
By the end of March a new system of government procurement will be in place that centralises the purchase of a number of commonly used categories. This includes professional services, which incorporates spend on consultants. The sourcing and negotiation of deals on energy, office supplies, ICT, telecoms, fleet, printing, marketing and media will also be centralised.
The PAC meeting on government consultant spend is available to watch for the next three weeks.