Red Alert

Posts Tagged ‘consultants’

Consultants for core administrative tasks?

Posted by on January 10th, 2013

Back in 2008 the then National opposition made two ‘key’ pledges when it came to public services. The first was to ‘cap but not cut’ the number of public servants, and the second was to ‘move resources from the back office to the frontline’. They didn’t keep either promise, but more importantly, evidence is increasingly emerging that their approach to public service provision is costing the taxpayer more, not less.

National’s cap on public service numbers has led to a blowout in consultancy costs, as government agencies continue to deal with the same, or in many cases greater, workloads with fewer people on board to do the work.

Take the Ministry of Education for example. This week I released data that shows they’ve been engaging expensive consultants to undertake core administrative tasks like processing official information requests, drafting ministerial documents, and writing business cases. I’ve got no problem with departments bring in outside expertise when a particular set of skills are required, but this is bread and butter stuff any department the size of the Ministry of Education should be able to deal with.

Between 2008 and 2011 ten of the biggest government departments spent a whopping $910 million on consultants and contractors between them. Those same agencies spent $114 million making people redundant during the same period. Increasingly anecdotal evidence is emerging of former employees being engaged as consultants to do the work they used to do for a lot less when they were employees.

National’s consultancy culture isn’t saving us money, it’s costing us more. It’s also leading to an erosion of the core capability of the public service, and some of the haphazard decisions ministers are making, often based on weak advice, reflect that.

Our democratic system relies on there being a quality public service with the expertise and capability to deliver on the priorities of the government of the day, whomever that may be. That includes the capability to deliver advice the government of the day might not like. Under National, that capability is being seriously eroded.

The consultancy blowout

Posted by on May 19th, 2012

The explosion in the cost of consultants and contractors over the last 5 years clearly shows that the National government have failed to live up their promise of a more efficient public service focused on the frontline. Between 2006/07 and 2010/11 the total spend on consultants and contractors leapt from $336 million to $525 million, the biggest leap coming in National’s first year in office when they imposed their arbitrary ‘cap’ on the number of staff the public service can employ.

National’s arbitrary cap on staff numbers has caused this blowout in consultants and contractors costs, plain and simple. They’re not delivering more efficient public services, in fact quite the opposite – Kiwis are paying more to get less. It can’t possibly be more efficient to make someone redundant one day and then reengage them on consultants rates only a few days later, as we’re now seeing happen throughout the public sector.

National’s supposed drive for greater efficiency in the public service has failed miserably. They’ve failed to adequately monitor the effect of their cuts, failed to stop cost blowouts in other areas, and failed to live up to their promise of a more efficient and effective public service. The consultancy culture has gotten so out of hand under National that Bill English’s own department, the Treasury, even hired a consultant to write a review on the use of consultants.

In these tight economic times, Kiwis want to know that the government is spending their tax dollar wisely. A more efficient and effective public service should be a major priority for any government. National has failed to deliver it.

Consultants and contractors

Posted by on April 11th, 2012

Keith Ng has been digging around the issue of government use of consultants. He’s unearthed some stats that show the use of consultants within the public service has increased under National, despite their promise to bring greater efficiency to public services.

This was inevitably going to be one of the consequences of National’s arbitrary ‘cap’ on the number of people employed by the public service. If government departments aren’t allowed to employ new staff, but still have to do the same amount of work, or in some cases even more, what will they do? They’ll contract the labour in, and it looks like that’s what’s happening.

As Danya Levy’s story on Stuff reminds us, last month the Defence force had to admit that it had rehired two Navy staff just weeks after making them redundant after it was unable to fill their roles. The more arbitrary cuts National inflicts, the more of this we’re going to see.

I’ve blogged before that I support a greater focus on efficiency and outcomes within the public service, but the National government are doing things back to front. They’re too focused on what they can cut and what they can sell, rather than reviewing what they actually want the public service to deliver. That’s where there attention should be focused.

Transparency in the use of consultants

Posted by on October 5th, 2009

As I revealed over the weekend, Bill English’s own purchase advisor Graham Scott decided not to charge for his services because he hadn’t identified any savings and had argued that “It wasn’t as if there was a whole lot of fat there I could advise them to get rid of.” He also claimed that the government was a regular client, which got me wondering just who else has been engaging his services and what for.

I asked written questions of each Minister as to whether any department or agency they are responsible for had engaged Dr Scott in the past 12 months or intended to engage him in the next 12 months. Bill English provided the most comprehensive answers:

Yes. Dr Scott was engaged by Treasury to provide purchase advice services to the Treasury and Minister of Finance, ending 30 June 2009. For the past 6 months, Dr Scott has been the Chair of the Regulatory Responsibility Taskforce, which was established to provide independent advice on the Regulatory Responsibility Bill. The Taskforce will be reporting back to Ministers English and Hide on 30 September. This Taskforce is funded through a non-departmental output expense within Vote Finance.

Dr Scott has extensive experience of a wide range of public management issues, here and overseas, and is always likely to be in demand by Government departments, but I am not aware of any specific intentions to engage his services.

Most other ministers simply answered ‘no’ which was to be expected. However a small number (Power, Guy, Williamson) dodged the question by answering along the lines that decisions on which consultants to engage were a matter for the chief executive. However in the case of purchase advisors clearly that’s not the case. Ministers directed departments who to engage and how much to pay them. What, if anything, are these ministers hiding?

Now to be clear, I don’t have a problem with departments using the services of people such as Dr Scott, but transparency is important, particularly where due process hasn’t been followed. The public service has a wide range of skills and expertise available ‘in house’ and decisions to engage outside consultants should, in my view, be made only where absolutely necessary. In each case the taxpayer is entitled to ask “Is there nobody already on the payroll who could do this task?” In the case of the purchase advisors I think there was/is.

More on Purchase Advisors

Posted by on October 4th, 2009

As I noted yesterday, it’s now become very clear that the new National-led government is spending more on staffing the Beehive than the previous Labour administration, despite their rhetoric about everyone having to make sacrifices.

The revelation earlier this year that Bill English had hired an elite team of expensive purchase advisors to identify savings for the Budget made a few ripples at the time, partly because the government had tried to keep it secret and partly because of the unorthodox way they had tried to hide the way they were being funded.

At the time English promised to put in place more enduring arrangements for funding the purchase advisors but now it looks like they have ditched the idea completely. Good stuff. It’s hard to see how they added much value to the process at all. A quick scan of the numbers suggests that most of the savings they identified were ‘under spends’ that would have been returned to the govt anyway.

In fact Graham Scott, the ex-Treasury head advising English himself, questioned the value of his own work and decided not the charge the govt at all. A direct quote from him: “It wasn’t as if there was a whole lot of fat there I could advise them to get rid of.” So much for English’s claim that the Wellington ‘bureaucracy’ was bloated!

More “Simon Says” from National

Posted by on October 3rd, 2009

When I was a kid we used to play a game called Simon Says. The object of the game was to get people to do as you said, but not as you did. The National-led government seem to have taken the game of Simon Says to a whole new level. They’ve adopted it as a political ideology.

While Bill English has been spouting doom and gloom around the country and telling everyone to tighten their belts, he and his colleagues have been inventing new and creative ways to rort the system in order to feather their own nests.

Take for example the spending on Beehive staff. Earlier this year Labour revealed that National had more than doubled the number of Beehive staff earning over $100,000 a year. Key and English waved that away saying that while they were paying higher salaries, they were employing fewer staff.

However that’s simply not true. Comparing the number of staff employed by Ministerial Services in June 2009 with the number employed at the same time last year we learn that the National government in fact employs only one less staff member. The salary bill is only marginally lower than it was under Labour.

But when we add in the cost of Bill English’s hand-picked purchase advisors (just under $300,000), and the fact that they have splashed out over $165,000 on ‘communications consultants’ it becomes clear that the National government are in fact spending considerably more staffing the Beehive.

It’s no wonder Bill English has a credibility problem.

Nats still splashing out on themselves

Posted by on July 16th, 2009

Earlier this year Labour revealed that the new National government had massively hiked up the salaries of Beehive staffers following the last election. Recent stats show there are 38 staff in the Beehive earning over $100,000 a year compared with just 16 in June last year. John Key claimed that while National was paying staff more, it was employing fewer of them. That’s not true. In June last year there were 162 Beehive staffers. In March this year there were 156, but that doesn’t include the six ‘purchase advisors’ Bill English instructed departments to hire and pay for.

A written parliamentary question I received today reveals that they have also spent over $220,000 on communications ‘consultants’ since the last election. So in addition to hiking up Beehive staff salaries, they’ve been raiding the public purse for consultants too. I don’t object to paying Beehive staff competitive salaries (I was a former Beehive staffer after all), but massive pay rises and splashing out on expensive consultants does look hypocritical at a time when they’re asking the rest of the public service to stomach cuts. It seems they think the burden of the recession should fall on everyone except themselves.