Millions 'wasted' on consultants

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The Scottish Government is wasting up to £13m a year by not using consultants efficiently, a report has claimed.

Audit Scotland has estimated that government bodies spent about £114m on 1,200 consultancies in 2006-2007.

But it said there was no clear strategy and savings could be found if the planning, management and purchasing of consultancy services was improved.

The Scottish Government recently issued guidance on the use of consultants, saying they should be used sparingly.

Auditor General for Scotland Robert Black said consultancies can be an expensive option.

He said: "Central government bodies need to plan their use of consultants so that they use their knowledge and skills where it brings greatest value for money.

"They should gather and share consistent information on what consultancy services they buy and why.

"Bodies should consider when it is better to use their own staff, and how best to ensure public servants learn from consultants when they are hired for projects or in advisory roles."

'Damning report'

Of the £114m spent in 2006-07, £41m was spent by government directorates. Quangos spent £38m, which includes £35m spent by Scottish Enterprise and Highlands and Islands Enterprise.

A further £35m was spent on consultancy services by government agencies, with Transport Scotland spending £12m.

The Audit Scotland report said: "There is a need to better plan the use of consultants.

"Use of consultants is rarely linked to wider planning about when and how to get the services needed and the best way to purchase them across the organisation as a whole."

It said the work done by consultants was not always evaluated and suggested the government should carry out "consistent and formal evaluation".

It recommended government bodies should take opportunities to learn from consultants and that staff should also fill key roles in projects where possible.

New, strengthened guidance introduced in December ... is aimed at ensuring consultants are only used when absolutely essential Scottish Government spokesman Tory finance spokesman Derek Brownlee said the Scottish Government should be delivering better value for money.

He said: "This is a damning report from Audit Scotland which shows clearly how the Scottish Government can improve value for money and save taxpayers millions of pounds.

"This is money which could be spent helping hard-pressed families or tackling the consequences of Labour's recession.

"We will be pressing the Scottish Government to take swift action on this to make sure this money is available for frontline public services."

Jeremy Purvis, the Liberal Democrat finance spokesman, said taxpayers' money should not be wasted unnecessarily.

He said: "Consultancies should only be used when it has been shown that central government cannot carry out the work themselves."

Government guidance reinforces the need for consultants to be used sparingly, effectively and only where unavoidable.

A Scottish Government spokesman said: "The figures in the Audit Scotland report relate to the period of the last administration.

"New, strengthened guidance introduced in December, and currently being extended across central government, is aimed at ensuring consultants are only used when absolutely essential. A robust business case for their use must be made, and options must be fully explored such as using in-house resources, or other external alternatives."

He said the government also aimed to save £6m each year by strengthening its procurement procedures.