The NAO has confirmed that the use of management consultancy by central government 'can provide great benefits'.
This week’s report Central government’s use of consultants and interims also puts forward some sensible ideas for improving the procurement and evaluation of these benefits, and warns ministers that their current moratorium is storing up longer-term problems for the taxpayer and their government.
But I can’t help feeling that the NAO has ducked the bigger questions that we now need to ask.
First, the difference between genuine management consultancy and the growing use of interim managers and contractors. The NAO helpfully clarifies that consultancy is project-based and outside ‘business as usual’; interims fill roles within the current organisational structure ‘that would otherwise be undertaken by a salaried permanent member of staff’.
Unlike its 2006 predecessor, the latest report specifically set out to analyse both these markets. It tells us that data on the use of interims is almost impossibly vague – most departments only started collecting in 2009 – and that the use of business cases is rare. It doesn’t probe the three departments who failed to provide any information at all. For the purposes of its expenditure figures, it assumes they spent nothing.
And then... er ... it stops. No analysis of why this market is growing; no evaluation of existing practice; and no recommendations for the future. This is a wasted opportunity. And a huge contrast with the sections on consultancy.
Second, how to focus on value. For months now, the MCA has been pressing government to change and to engage with the industry. Both buyers and suppliers need to maintain a disciplined focus on delivering the best possible outcomes, not just inputs. The traditional concentration on paying for ‘time and materials’ often gets in the way.
The report supports many of our arguments and proposals. There should be clearer definitions of the desired outcomes and much more rigorous evaluation. But its views are too timid. For instance, the NAO tries to say that government should both move away from its focus on day rates – with more use of fixed price contracts and payment by results - and that the Cabinet Office’s recent ‘rate card for consultants’ is a good idea.
And, third, why has Whitehall found it so difficult to change its ways in the past? The current fiscal crisis, and the advent of a new government, provide the opportunity to create a new buying regime, based on the value of the outcomes that consulting can achieve. The arrival of the Efficiency and Reform Group means that government has a mechanism for guiding and leading this change.
To be clear, there is a lot that the industry can and wants to do to ensure that the focus on value is cemented into the buying of consultancy. The MCA’s Code of Practice provides an excellent starting point. There is also a host of experience and best practice now in the private sector that government could adopt. But this will require real leadership from the top, which needs to be identified and tasked with the job. The NAO could - and should - have offered a more confident set of recommendations.
Alan Leaman is chief executive of the Management Consultancies Association
