BBC Home
Explore the BBC
BBC News
Launch consoleBBC NEWS CHANNEL
Last Updated: Friday, 15 December 2006, 00:28 GMT
Spending on consultants at 2.8bn
Computer keyboard
IT consultants were among the outside experts used by departments
The public sector paid 2.8bn to outside consultants last year, the government's spending watchdog says.

The National Audit Office said the 2005/06 figure represented a rise of 33% over three years.

But the amount spent by central government departments fell from 2bn to 1.8bn during the same period.

"When used incorrectly, consultants can drain budgets very quickly, with little or no productive results," the NAO report added.

Reduction plans

Over the past three years a total of 7.2bn is thought to have been paid out in consultants' fees.

However, the NAO report said money was often being spent unnecessarily because of the inefficient way government departments and other public bodies used outside experts.

It calculated the annual bill could be reduced by 270m immediately if proper efficiency savings were brought in, rising to 540m in three years' time - a total saving of more than 1bn over the period.

The external consultancy gravy train continues full steam ahead
Edward Leigh, public accounts committee

Whitehall departments often failed to look at using their own staff - rather than outside consultants - the report said.

The NAO said that the average daily cost of an internal Ministry of Defence consultant was 550, while one from outside came to 1,245.

Departments did not collect adequate information about the work done to see what benefits they were getting.

NAO head Sir John Bourn said: "Departments need to think ahead about what skills they should have, so they don't have to rely on consultants year after year."

Edward Leigh, the chairman of the Commons public accounts committee, said departments had to "kick their consultancy habit".

He added: "The NAO confirms what many of us have long suspected - the external consultancy gravy train continues full steam ahead, courtesy of the public purse."

The NAO said the biggest spender on consultants was the Department for International Development, with bills totalling 800m over the last three years.

The Ministry of Defence spent 670m and the Department for Environment, Food and Rural Affairs 500m.

The biggest-earning firm was IBM, which collected fees of 749m over the past three years, followed by LogicaCMG with 431m and Accenture with 350m.

Liberal Democrat Treasury spokesman Vince Cable said: "This report confirms the reckless way most government departments use consultants.

"They are failing in their responsibility to gain value for taxpayers' money.

"It is disgraceful that government departments are resorting to expensive consultants before checking whether their staff could do the job."

Secrecy over government consultants
31 Jan 06 |  File on 4

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific