New Labour Goes Consulting Crazy

When the Labour Party had been in opposition, they lambasted the ruling Conservative govt for spending as much as £500m a 12 months on control and IT methods experts. This was once, they thundered, “a disgraceful waste of taxpayers’ cash – cash that are supposed to be spent on frontline products and services like hospitals and faculties” moderately than being passed over to a couple of already rich experts. Now New Labour are in energy, they appear to have modified their minds. However, New Labour have no longer simply spent a trifling £500m a 12 months on experts – that they had a lot more formidable plans than that. In their grand plan to modernise the supply of public products and services, they appear to have sidelined the Civil Service and feature determined to each make their new insurance policies and put in force them the usage of their favorite control and IT methods experts. This is popping out to be a dear workout – it’s going to value us, the taxpayers, smartly over £70bn – greater than £20bn for control experts and a minimum of every other £50bn for IT methods experts

The huge quantities of taxpayers’ cash being passed over to experts might be noticed as proof of a dynamic, forward-looking govt making an investment in modernising their nation. At least, it will be certain had been those huge investments a hit. However, enjoy thus far is lower than promising. Judging via what has took place, New Labour’s investments in control and IT methods consulting seem to have simply been a sequence of unmitigated and shameful screw ups. So dangerous was once the placement, that during an all-party committee of MPs criticised the British Government for each losing taxpayers’ cash and looking to quilt up the reality about its monetary mismanagement. The committee concluded that the British Government’s report on IT consulting tasks was once ‘an appalling waste of public cash which Whitehall was once looking to disguise at the back of a cloak of business confidentiality’. There were such a lot of screw ups just like the Child Support Agency – £1bn wasted on experts, the National Offender Management Service – about £300m wasted and the Ministry of Defence – a minimum of £500m spent on consulting that gave completely no effects. The maximum shameful mission of all should be the brand new NHS IT device which was once deliberate to take three years to finish and value simply £2.3bn – it’s going to in reality take over 10 years, will value over £12bn and may not even paintings correctly.


Management and IT methods consultancies are companies. As companies, their intention is cash in maximisation. This method they should attempt to promote as a lot in their product as they are able to on the very best worth conceivable. Just like some other industry – producers of sentimental beverages, breakfast cereals, photocopiers, paperclips, vehicles, burgers, cigarettes or no matter. When you promote control or IT methods consulting to every other industrial corporate like a financial institution, insurance coverage corporate or an oil corporate, you might be taking part in a industrial sport, the place you each know the principles. You attempt to get as a lot in their cash as conceivable via pondering up a wide variety of ‘crucial’ products and services and new IT methods you’ll promote them and also you price them up to you assume you’ll break out with. As everyone is aware of, that is how industry works. And anyway maximum banks, insurance coverage corporations and oil corporations are vastly wasteful bureaucracies that experience extra money than they know what to do with.

However, having spent over two decades promoting consulting to many corporations and govt departments, I consider that this case adjustments when a profit-maximising corporate like a consultancy sells its products and services to public sector organisations. Because right here, each hundred million this is channelled into control and IT methods consultancies’ wallet method 100 million much less that may be spent on offering crucial products and services in spaces like well being, defence, faculties, social products and services and police. So if a control consultancy knowingly sells a mission the place it puts twenty to thirty to 40 green experts in some govt division or different, when two or 3 skilled experts can have completed the mission extra temporarily and a lot more cost effectively, it’s a must to ask whether or not that is simply nifty industry or whether or not the consultancy might be accused of unethical apply. Similarly, if an IT methods consultancy manages to persuade a central authority division that it must spend say £400m on development an absolutely new IT device, when it is aware of that an present device can have simply been upgraded for lower than £40m – is that this only a case of the consultancy being canny businessmen or is it nearer to robbery of public price range? Moreover, if those consultancies additionally systematically overcharge the Government for his or her experts’ time, invoice for fictitious management, price the Government the overall value of commute bills whilst preserving kickbacks from commute corporations and make the Government pay for time experts and their managers spend on inner consultancy actions – once more the query, is that this simply good industry or a fraudulent scam?

There is every other measurement to the ethical problems coming up from how consultancies paintings within the public sector. If a consultancy or methods supplier fails to succeed in the promised effects for a personal sector corporate, no person truly will get harm. But if green junior experts set meaningless goals for the well being carrier which result in ward closures and not more sufferers being handled. Or if consultancies produce IT methods fiascos for presidency departments that save you folks from travelling because of them no longer having passports, that depart over 176,000 immigrants caught in limbo for months as a result of their programs can’t be processed, that save you courts prosecuting criminals, that reason households to lose their houses or that impoverish loads of hundreds of low source of revenue families, then it sort of feels cheap to query the ethics of consultancies which might be glad to take the money and but are apparently impervious to the entire struggling led to via their incompetence and greed.


At a dinner just lately, I used to be sitting subsequent to a gentleman who shall stay anonymous. He had a knighthood and at quite a lot of instances have been a professor at a number one industry college, a director of the Bank of England, a former member of the Cabinet Office Central Policy Review Staff (the ‘Think Tank’), a director of the Treasury and a director of a big financial institution. I began chatting with him about my considerations over the quantity of taxpayers’ cash being passed over to experts and the sequence of catastrophes that had ensued. I then advised that the Government was once being taken for an excessively pricey trip via its experts. The gentleman appeared disdainfully at me and mentioned dismissively, ‘I to find your arguments flawed and missing in highbrow rigour – the folks on the Treasury and the Bank of England don’t seem to be silly’.

Having noticed such a lot consultancy bought to such a lot of govt departments yielding so laughably little in the way in which of effects, I’ve written a ebook to inform the tale of what truly occurs when control and IT methods experts are paid to carry their magic into public sector organizations. Now taxpayers could make up their very own minds concerning the gumption or in a different way of the folks on the Bank of England, the Treasury and the two,500 different govt departments who’re contributing so generously to the welfare of already rich control and IT methods experts via giving them virtually fantastic quantities of our cash.