The bill for private consultants hired by the government to help combat the coronavirus pandemic has climbed to £175m, as the chair of an influential parliamentary committee revealed that MPs would investigate the multimillion pound use of management consultancies.
The government has bought consulting services from almost 90 different companies as it scrambled to fill gaps in the civil service’s pandemic response.
Disclosed spending on consultants has risen by £65m since the end of August, a 35% increase, according to contracts collated by the data company Tussell.
The newly disclosed spending included work on setting up and running the malfunctioning test-and-trace system, procuring medicines, buying personal protective equipment and supporting the government’s contact-tracing app.
The rapid increase in the consultancy bill in recent weeks to a new total of £175m was partly driven by belated publication of contracts. Tussell’s analysis showed that government bodies took 80 days on average to publish the contracts. The statutory maximum is 30 days.
The latest figures emerged in the same week it was revealed that executives at Boston Consulting Group, the fourth biggest recipient of coronavirus consulting contracts, were being paid as much as £6,250 a day to work on the struggling NHS test-and-trace system.
The government’s reliance on expensive management consultants has come under scrutiny during the pandemic. Lord Agnew, the Cabinet Office and Treasury minister, last month said the civil service had been infantilised by an unacceptable reliance on consultants.
Meg Hillier, the chair of the public accounts committee, said on Thursday she was shocked by the increase in consultancy costs, adding that her committee had launched an inquiry into the government’s use of consultants.
“What on earth are they doing? It is a very steep increase in a very short space of time. You cannot just tear up the rules and dish out taxpayers’ money in this way,” Hillier said.
Referring to the delay in publishing contracts, she said: “Not publishing them on time is not acceptable and there is no excuse. At a time when we have given the government huge powers to bypass the usual tendering process the government should be more transparent not less.
“It appears as if there is a general disdain for parliament and the public. The public are not fools.”
Many of the largest contracts – including those published in the last 45 days – date from March or April, when the government brought in the emergency procurement rules.
The largest consulting firms have been among the biggest beneficiaries. The value of contracts awarded to Deloitte has risen to £22.7m while its rival PricewaterhouseCoopers’s has increased to £24.4m, according the latest data. Senior partners in consulting firms often charge thousands of pounds for a day’s work.
The Cabinet Office, which has coordinated much of the government’s pandemic response, was the biggest single buyer of consulting services, with £53.8m of contracts awarded. The Department of Health and Social Care has spent £44.2m on consultants.
Tamzen Isacsson, the chief executive of the Management Consultancies Association, a lobby group, said consultants can provide the government with skills and value for money.
“Government departments have faced an unprecedented volume of workload with Brexit planning and Covid-19 and using external resources has enabled the government to work quickly and with intensity on major initiatives,” she said.
A government spokesman said: “We are building a huge diagnostic network and to achieve this we need to work with both public- and private-sector partners who have the specialist skills and experience we need, to work at pace.
“Every pound spent is contributing towards our efforts to keep people safe as we ramp up testing capacity to 500,000 tests a day by the end of October.”
