Australian Public service faces crackdown on wasteful procurement of consultants

Australian Public service faces crackdown on wasteful procurement of consultants

Wasteful procurement on consultants for the Australian Public service appears to be firmly in the crosshairs of the Department of Finance. 

Riotact, part of Region Group which reports news from Canberra, reports 2023 has brought a sharpened focus on auditing outsourcing across the public service. 

Consultancy contracts coordinated through the Department of Finance are understood to be on the central agency’s radar since it set up two new panels for Whole of Australian Government (WOaG) procurement of consultancy services last year. 

“In 2022, Finance established two new WoAG panels: the People Panel, for recruitment and search services, labour hire services and contractor services; and the Management Advisory Services Panel, for management advisory services, commonly known as consultancies,” A finance department spokesperson told Region. 

“These panels are mandatory for non-corporate Commonwealth entities and optional for corporate Commonwealth entities and Commonwealth companies, including Government Business Enterprises authorised by Finance to use the Panel. Procurements undertaken using these panels are reported on AusTender in the usual manner.”

Region reported that a Department insider indicated the axe would fall on more contractor roles. 

“Expect to see a lot more contractors let go and a lot fewer consultancies hired this year,” the insider told Region.

“The budget bottom line is what’s ruling all decisions right now and things will change rapidly in the APS.”

While in opposition, Labor pledged to cut $3.6 billion in consultants over four years. But media reports claim $1.2 billion was spent in just six months by Prime Minister’s Anthony Albanese’s Government. 

A high-level consultancy source said it would be “next to impossible for the government to replace any significant level of external contracts.”

“Consultants are embedded and the government has to face up to that fact,” they told Region. 

Read  more on the Region website.

‘$300m spent with PWC’

Greens Senator Barbara Pocock called for a review into government engagements with “Big four” consultancies. 

“These companies, PwC, Deloitte, EY and KPMG, are raking in hundreds of millions of dollars each year doing work that should be done by the public sector, and without appropriate assurances about ethical behaviour,” she said in a media release. 

Pocock said PwC won Government contracts worth more than $300 million last year. 

Last year, digital procurement by the Australian Government was put under the microscope following a review of the  Digital Transformation Agency by the Australian National Audit Office (ANAO). The review found procurements had not complied with Commonwealth Procurement Rules (CPRs). 

One contract valued at $121,000 was increased by 40 times to nearly $5 million.

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