Today we have published our latest research on the use of management consultants. Savings of over £40m could be made from local council costs, by cutting back on the amount of use they make of private consultancy firms.
Using the Freedom of Information (Scotland) Act (FOI), we asked all councils what they spent on consultants last year, and the figures show that last year councils poured over £42m of public money into the pockets of these private firms. In an earlier blog message I highlighted figures that show nearly £6m of this went to one firm – KPMG, who are busy advising Scotland’s councils where they can save money by cutting services, staff and conditions.
With the UK Budget due on Wednesday, Alastair Darling might want to take a second look at UNISON’s alternative budget that highlights how much could be saved from wasteful spending, including by ending the use of consultants.
Top of the league table on consultant spend last year is City of Edinburgh, where the council is investigating outsourcing a huge raft of public services. They spent £6.4m last year on consultants. One consultant was adviser to Lehmann Brothers, Ernst & Young. It is scandalous that it is same firm that endorsed Lehman Brothers’ methods of business (leading to the major world recession) is now advising massive privatisation to Edinburgh City as their solution to the financial crisis, earning a nice fee for them as consultants.
What you have singly failed to describe, Mr Watson, are the benefit that these advisors have brought the councils. How much money was saved on the back of their advice, how much cost was avoided before bad decisions were made? Without that figure, simply quoting their fees gets us no where. Personally, if KPMG saved £60 million, then I and many others would consider their £6 million in fees value for money. Maybe you should consider those questions before making ignoble statements.
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