NAO: Consultants Not Value for Money for the Government

Sarah Woodman, Global events journalist
October 15, 2010 /

According to the National Audit Office (NAO), the government does not get any value for money it invests in external consultants due to a lack of information, skills and strategies that is necessary to manage them effectively.

The particular NAO report looks at 17 government departments in the financial year of 2009-2010, and found that the government spent over £1 billion on consultants and interim managers. This was only slightly lower than what it spent in the previous years.

According to the NAO report, Pricewaterhouse Coopers, Deloitte and KPMG were the firms which were the most frequently named by government departments as their top 10 suppliers of consultancy services.
The department which spent the most on consultancy services and auditing facilities were the Department for Transport, which spent £96 million and the Department of Health, which spent £108 million.
The HMRC (HM Revenue & Customs) was the 8th on the list. It spent £50m. This figure is down 30% when compared to previous years.
HMRC has spent the lowest on consultancy services in proportion to its staff costs than any government department because it employs a large number of staff for administration.
The NAO report further states that the Department of Health and the Department for Work and Pensions clocked the highest drop in the amount of money spent on consultancy services.
The Treasury spent more on consultancy services because it brought in external advice during the banking crisis.
Amyas Morse, who is the Head of NAO, said that government departments need to “do more to integrate their decisions to use consultants within their wider workforce planning; define the services required; know how the consultants’ work is contributing to departmental objectives; and evaluate performance during projects and assess what benefits, if any, have been delivered.”


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