Manchester hospital trusts paid 150 million to advisors

07 January 2015 Consultancy.uk

Over the past three years, hospital trusts in Greater Manchester have paid consulting firms nearly £150 million in fees to manage transformation and outsourcing programmes.

Data gathered from freedom of information requests reveals that the more than 80 hospital trusts in the Greater Manchester region have on a large scale hired external consultants to support them with transformation programmes, across a range of areas, from strategy, to organisation, finance and IT. Although not all data has been uncovered, what is known is that the Big Four have been paid at least £109.3 million over the past three years, while Capita has raked in at least £34.9 million over the same timeframe. The true height of spending in practice though likely to be higher.

In the case of six hospital trusts* accurate data has been released, a sample which represents less than 10% of the total known spending. For these six institutions, Consultancy.uk assessed the spending on five firms: Capita, Deloitte, EY, PwC and KPMG. The analysis reveals that the Tameside Hospital NHS Foundation Trust and the Salford Royal NHS Foundation Trust spent the most on the five firms, of which the former spent three-quarters on PwC and the latter half on Capita. The Central Manchester University Hospitals Trust ranks third with £1.8 million and the University Hospital Of South Manchester NHS Foundation Trust fourth with £1.5 million.

Fees paid by six trusts to five consulting firms

At the recipient end, Capita and KPMG were the largest fee earners. Deloitte and EY earned just over £1.2 million, a bit more than half the fees charged by Capita. In total, the five consultancies were paid £8.7 million: the Big Four invoicing £6.6 million, Capita charging £2.1 million.

NHS
Greater Manchester is by no means the only region where healthcare trusts spend millions seeking the advice and support from consulting firms. In a recent story Consultancy.uk reported about the external consulting spending of the NHS, which amounted to £640 million last year, up from £313 million in 2010. According to insiders within the NHS, professional services firms are profiteering from the uncertainty and chaos associated from a large scale and forced top down process. At the other side of the spectrum, spokespersons for the consulting industry, such as the MCA and PR-officers of firms, highlight the value added provided by advisors. 

* Central Manchester University Hospitals Trust, Salford Royal NHS Foundation Trust, Stockport NHS Foundation Trust, Tameside Hospital NHS Foundation Trust, University Hospital Of South Manchester NHS Foundation Trust, Wrightington Wigan and Leigh NHS Foundation Trust.

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