Blair spends record amount on consultants
Labour government adds 1p to income tax in record spend on private consultants despite efficiency drive and cuts in public sector jobs and services
Government spending on consultants has rocketed to £2.5bn at the same time as
Whitehall tries to cut 84,000 civil service jobs and £20bn in the public sector
in line with the Gershon efficiency review.
Figures from the Office of Government Commerce showed that spending on
management consultants increased by 42% last year from £1.76bn in 2003-04 to
£2.5bn, the equivalent of a penny in the pound on income tax.
The Times said this was as much as it would cost to build 150 new
hospitals or employ more than 100,000 nurses or 75,000 policemen.
An increasing number of consultancies have switched their focus to public
sector contracts, which can attract daily fees of up to £2,000. Firms are being
hired to advise on outsourcing, change and transformation management, IT system
implementation, advertising and communications and to conduct polls and surveys.
The paper said that the NHS, which spent £85m on consultancy work last year,
was up 235%; defence, up 77% at £148m; work and pensions £345m; and transport
£328m. It added that local government paid consultants more than £230m, almost
four times as much as in 2004.
