Burgenoning cost of Consultants in HMG and Naval Pensions...

Discussion in 'Current Affairs' started by Always_a_Civvy, Jun 19, 2007.

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  1. Today's Guardian (19 June 2007, p4) makes interesting reading regarding the increasing annual cost to the taxpayer of bankrolling consultancy firms to perform the role that civil service managers in the past were paid to perform themselves - at significantly less cost to the taxpayer.

    The annual cost in the Financial Year 2003-04 was £1.8Bn.
    That figure has risen by one third in FY 2005-06 to £2.8Bn.

    Of course it might be argued that it is saving money by costing us less paying to resolve mistakes, but I remain unconvinced (by the dearth of evidence: the result of commercial in confidence clauses being used to conceil information that was previously available in the public domain even before the FoI legislation came into force). After all if it is really such good value, why aren't these data being published?

    Also this annual sum could be used to wholly or partially fund the annual cost of paying pensions to those service personnel who joined pre-1975 but did not complete the 22 years service to qualify, especially as the government have already admitted that they do not know what the actual cost of providing this would be, but are only speculating More here on THAT topic: http://www.rumration.co.uk/cpgn2/Forums/viewtopic/t=7464.html !
  2. Your figures are off: the bill for 05/06 was 2.8B, of which 1.8B was for programme and project management, and IT. The majority of the latter was for the NHS. The figure for 03/04 was 2.1B. The current year spend is also below the equivalent last year.

    I'm always amazed by how much the Gruniad distorts facts. I read the actual report and the Q&A that the OGC got in the committee hearings. While the report acknowledges that the OGC doesn't know all of the savings that the use of consultants has led to, they don't even postulate based on what they do know.

    As for not using inhouse people instead, the MoD has been doing that for years!
  3. As far as I can see consultants are hired for two main reasons, firstly the civil service has failed to get abreast of new technology and thus has to hire people on short term contracts at great expense to cover for this lack of foresight and planning. Secondly the government has taken to hiring consultants to rubber stamp their pet policies so that they can claim they have been independantly check, approved or what ever.

    In both cases it is a waste of our money.
  4. To be honest, I disagree. As a consultant, I tend to move about a lot, often having between one and four contracts every twelve months. Sometimes I'm living away from home in a b&b during the week for up to six months at a time.. Even with the extra money paid, it's hard work to be away for so long.

    As to the government/civil service not keeping up with technology - both yes and no. The civil service has no great interest in keeping someone employed for 20-30 years as they did a few decades ago. To employ me fulltime, they would have had to double the permanent rates of pay, train me by sending me on courses and to different departments to gain the experience - all things that would cost them a lot of money over a long period of time. Instead, they pay me two-three times what the permanent staff get - I come in for a project or to provide cover, am able to quickly pick up the tasks at hand without long periods of training, and then go again..

    Those are the type of consultants that are employed by the civil service or MoD - highly paid, come in, perform a task, then leave. We provide immediate cover, we run/implement projects or perform any tasks as required. You'd be hard-pressed to find permanent staff with our abilities, our experience or our references - especially for the amount they're happy to pay permies.

    And we're treated like sh1t 99% of the time. Yet we don't complain.
  5. What you mean only 99% of the time.........
  6. This does not come as a suprise to me.
    In 2000 I was working in an unnamed MOD establishment in the South West. We employed service and civilian contractors (they preferred to be called consultants) The contractors were almost entirely ex-service, and were getting paid much more than a mere matelot. What happened was that people would get trained to do the (un named) job, and then put their notice in. They realised that the qualification they had just passed made them saleable in the wider market. Consequently, we stopped training matelots, and used more consultants. The rates were astounding. A CPO left on the thursday, and arrived on the tuesday in a different shirt, earning considerably more as a self employed consultant. Add employing your wife as a secretary and we are talking large amounts of wonga. after 18 months he had gone from rented accom, to owning 3 houses and renting 2 out.
  7. Oslo, I incorporated both figures in the overall cost, rather than seperating them. I consider the use of Consultants for NHS & IT work to be just as invidious. After all NHS IT like the rest of government IT has problems and the consultancy firms doing these diverse projects are usually remarkably similar. On issues like the PFI the government only seem to release favourable savings figures and avoid providing evidence that might in any way harm their reputation for financial probity. In the absence of these data, any data suggesting value for money are at the least questionable.

    As for the MOD... could we ever expect them to behave differently? :lol:
  8. I think it is important to be clear about this picture: you can't group all consultants together. You have the "IT implementers", such as EDS, Accenture and LogicaCMG; you have the pure strategy ones, such as McKinsey, Bain, PRTM; and you have the implementing strategy ones, such as PA and Deloitte. Each does a different job at a different level and will be brought in for different reasons. Some to do a job where there is a skill shortage in the department, some to actually do the job (as interim managers) and some to bring best practice from other industry. Yes there may be hidden agendas when civil servants hire consultants, but to label the industry as a "waste of money" is to not understand what they do. Yes there are cowboys, but the majority of the consultants that I've met and known, in and out of uniform, on Whitehall and elsewhere are honest, hardworking and save a HUGE amount of money, even considering their fees. So if they charge, say, £1m for doing something that saves £10m+, I don't see a problem - they are not charities. Now, should government departments look at their own skills before going outside? Absolutely, but there are perfectly valid reasons for using them.

    On another note, just because someone is doing working to a contract no more makes them a "consultant", then the guy who installs NTL cabling is an "engineer".

    Sorry about the rambling - I'm just tired of short sighted politicians.
  9. I conceed that you've made a valid point there.

    Don't tell that to our Photocopying Engineers. It apparently takes a lot of technical skill to pull out an old, and slide in a new, PCB! :wink:

  10. chieftiff

    chieftiff War Hero Moderator

    Would you include the Armed Forces in that? Bizarrely JPA has a facility for displaying educational qualifications and membership of professional bodies but chooses not to use it. I have been quietly gathering academic, training and human resource management qualifications at my own cost over the last 24 years. Add to this full membership of professional bodies who recognise my abilities and you have to wonder why the pusser isn't interested as only my boss knows? Is it because I is not an ociffer? I suspect so. The point is there is a lot of expertise in the services going unused, by the time people realise their earning potential in civvi street it's too late, they're gone. Guess what? I'm gone.........................
  11. I am a contractor (not a consultant). I was bought in for a specific reason by one department working on a system that is being replaced. By me coming in, it meas a full time member of staff is being trained on the new system and when it goes live there will be no loss of performance as bodies are already in place to support the new system as of day 1.

    My contract is for 6 months and if I sit and work out what I earn AFTER i pay tax, NI, Pension, agency fees etc then I am earning not much more than the full time guys and I also know that when my contract is up, im out of work.

    Please don't tar us all with the same brush, thats like saying all sailors are piss head womanisers that will shag anything, male or female, alive or dead, animal, mineral or vegetable - oh crap they are....
  12. Re: Burgenoning cost of Consultants in HMG and Naval Pension

    I was thinking about this thread on the train home this evening, but this pretty much captures it.

    That said there are some firms which trade on their reputation, and that applies throughout the sector. At least two of the top tier are very aggressive about using an engagement to sell more and more people in, then leave you with a nice slide pack at the end to explain how Defence Procurement has just been fcuked up.

    At the bottom end of the market, manpower substitution then it is frequently cheaper in the long term to bring people in, because its easier to be ruthless about manpower when you're not going to have them hanging around for a two year draft even when the work has expired. For individuals in this area there are opportunities to make money, but it needs a pretty good understanding of how to exploit tax and VAT opportunities, and it can be high risk. The Professional Contractors Group provide some useful advice on that, as do HM Revenue and Customs themselves.

    As ever the media are reporting only a small chunk of a fairly complex story.

    Incidentally, most government ITTs nowadays carry caveats indicating that Commercial in Confidence markings need not be complied with in the event of a FOIA request, hence competitive information can be reasonably gleaned from the procurement activity itself. It's one way firms gain competitive information about the market following any downselect decision.
  13. Oh, and in the interests of disclosure, I work in the industry although I don't do Defence work. I got out of that game when I hung my cap up.
  14. Which would be fine if they really knew what to ask in the first place, tasked you properly and so on. All too often with so many of these projects they enter into bad contracts because they did not either understand the problem or incorrectly specified what they wanted done and the result is far too often to plain to see for all. Then when the programme goes tits up they blame the contractor who can't say too much as he wants to keep in the business.
  15. Buying in expertise when you understand what you need is not a waste of money, but at the same time money is wasted as too often it would appear the experise to contract the contractor is not there.

    Equally employing consultants to legitemise dogma is a waste of cash, as is the present tendency the then visit the same consultants on bodies that get government cash to mould them into the same dogma.

    There is plenty of good work done by consultants and contractors, but there is a lot of money wasted at the same time, money that could be spent better elsewhere.
  16. Ninja_Stoker

    Ninja_Stoker War Hero Moderator

    Re: Burgenoning cost of Consultants in HMG and Naval Pension

  17. Re: Burgenoning cost of Consultants in HMG and Naval Pension

    There are two aspects to this, the technical expertise that contractors or consultants bring, and the contracting expertise in actually framing the engagement. Whilst I had no problem with bringing in the former when I was in the service, and continue to have no problem with it now that I'm in the private sector, government in general is weak at the latter.

    My experience of most MOD and broader government commercial staff was pretty bad, they were only really interested in procurement decisions based around cost indicators, rather than the value that a vendor could bring to the contract. As a requirements manager and user representative I was frequently appalled at issues which were deemed unimportant in the buying decision.

    On the other side of the fence now I repeatedly see poorly written Tender invitations, lacking clarity and clearly lacking understanding of the desired end state.

    Indeed, although as OSLO points out, an effective strategy or implementation firm should be able to recover the cost as a result of their intervention. If they're not paying for themselves then the business case doesn't hold up. That last doesn't really apply to the contractor/ manpower substitution end of the market though.
  18. Karma

    I agree, sensibly employed consultants save money, that is why we in industry use them, but it only works when you know what you are doing.

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