Labor vowed to crack down on consultants, but spending is going up

The Age

a day ago

The Albanese government had more than $637 million worth of consulting contracts in the past six months, up more than $100 million on the previous half-year, despite repeated promises to cut back on external advisers.
A biannual statement tabled in parliament on Tuesday revealed the government had 131 consultancy contracts valued at $2 million or more active for at least one day between January 1 and June 30, with some individual contracts worth $30 million alone.
The high spend shows the challenge for Labor after it vowed to crack down on overreliance on private consultants following concerns about outsourcing and the 2023 PwC tax leaks scandal.
Treasurer Jim Chalmers has previously said the Coalition gave core government work to consultants before Labor was elected in 2022, and pledged to restore the public service.
'When we came to office, the public service was hollowed out with too much spending on contractors and consultants,' Chalmers said in April.
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The publication of the data will also test Labor's pre-election pledge in April to save $6.4 billion in four years by reducing spending on consultants, contractors, labour hire and non-wage expenses like travel, hospitality and property.
Multimillion dollar projects with descriptions such as 'industrial uplift strategy' and 'structural review services' from major firms such as McKinsey and BCG are some examples of department spending on consultancy services.
Governments commonly give contracts to consulting firms because they claim to offer independent advice, have solved similar problems overseas or at a state level, and can provide access to experts with specialised knowledge.