UK political parties receive millions in free consultancy

18 November 2014

The Liberal Democrats have since 2010 received more than £500,000 in ‘pro-bono’ consultancy support from large professional services firms PwC and KPMG. During the same period, Labour has received £600,000 of consultancy advice from PwC. Between 2005 and 2010 the conservatives received £1.5 million, PwC and KPMG again led the pack, but also strategy consulting firms such as The Boston Consulting Group and Bain & Company have provided them secondments.

The support came in the form of secondments as well as direct research advice. The shadow chancellor Ed Balls received almost £200,000 worth of secondments, while his team received £170,000 of advice. The Electoral Commission’s register of donations show that Labour also received £250,000 worth of donations from KPMG for staff support at its Party Headquarters. The advice was on topics such as tax policy, business and welfare. With the liberal democrats receiving their £500,000 donation in terms of staff costs from PwC and KPMG.

The debate between link between ‘free’ consultancy and politics is long debated. Historically consultants have been seen as thought leaders, possessing specialist knowledge on complex and diverse economic and financial knowledge. Since the shadow government lacks access to civil servants that possess the knowledge required to turn party policy ideas into reality, external knowledge and thought is required. This is where the consultants come in.

Political parties have received millions worth in free consultancy

For the consultancy concerns themselves, providing their services for a reduced or ‘pro-bono’ rate presents possible advantages, in the form of familiarity both with the resultant policy and networking, a spokesperson for PwC stating: “Our people provide limited and fully disclosed technical support to the main political parties in areas where our expertise and knowledge of the business environment can help them better understand technical matters and the consequences of their policy proposals,” going on to say “We do not develop policy on their behalf.”

A spokesperson from KPMG said it is “longstanding policy” to provide secondments to political parties. “When staff are seconded, they operate entirely under the direction and management of the relevant party and the secondments are underpinned by strict confidentiality agreements,” the company said. “As such, KPMG receives no benefits or favourable treatment.”


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Manchester Mayor criticised for £250,000 consulting spend

19 March 2019

The Mayor of Greater Manchester has been criticised for splurging hundreds of thousands of pounds on consulting fees before determining that the region’s fire brigade must slash its budget by millions. Andy Burnham put more than £250,000 towards work from ten consulting firms as part of a review into the region’s emergency services.

Despite the continued argument that projects like the Northern Powerhouse initiative are helping to address the North-South divide in the UK, statistics still show that the North has borne the brunt of austerity in England. Northern English cities have been disproportionately affected, with their spending cut on average by a fifth since 2010, while cities in the south and east of England had average losses of 9%.

The impact of spending cuts has been keenly felt in Greater Manchester in particular, where local government spending has fallen by as much as £650 per person since 2009 in some parts of the region. As the area looks to find further savings, while the Central Government continues to fail to deliver on its pledge to end austerity, it has been announced that the fire brigade for Greater Manchester faces a reduction of up to £10 million from its budget.

The swingeing cuts to hit the emergency service would likely see its fleet of fire engines reduced from 56 to 47, while six fire stations face closure, and 113 support staff could suffer the axe. The news follows an investigation from Mayor Andy Burnham, which was triggered in part by the admission of Chief Fire Officer, Jim Wallace, that since 2015 the service has failed to deliver “its own efficiency plan”.

Greater Manchester Mayor Andy Burnham spent £268,300 to review the city’s fire service

The review itself has been far from inexpensive, however, and it has led some to accuse Burnham of hypocrisy. During the review of the fire service, which has delivered demands for the service to find major efficiency savings, the Greater Manchester Mayor reportedly splurged £268,300 in public funds on consulting work for his root-and-branch review.

According to local newspaper Manchester Evening News, Burnham tasked ten different consultancies with helping to compile the review, receiving payments ranging from £101,000 to £7,000. The largest amount was handed to Leicester headquartered P. Cooper & Associates for the expertise of a “senior change and transformation programme specialist,” while it was reported that another of the consultants gave “guidance on leadership and culture”.

A Greater Manchester Fire and Rescue Service (GMFRS) spokesman said of the spending: “The Programme for Change programme has required input from specialists who are expert in areas such as organisational transformation, operating models for fire safety and estates.”

Manchester’s fire brigade was criticised in 2017 when, in the wake of the Manchester Arena bombing, a report by Lord Kerslake noted crews had been held back from helping. Contrary to helping deliver a more efficient service, Unison has told the press that it believes the proposed cuts will make the residents of Greater Manchester “less safe”. With the expenditure of the review on private sector consultants now public, meanwhile, the union has slammed the report for throwing away public funds while jeopardising vital public sector work.

Unison represents the 113 staff who may lose their jobs, and a spokesperson for the union told Manchester Evening News, "It's disappointing that when finances are clearly tight, priority has been given to hiring external consultants rather than engaging with the workforce. This will be a shock to our members who were only told on Monday their jobs were at risk."

In recent years, a succession of local authorities have come under fire from officials and the general public for their consulting spending in the UK. Earlier in 2019, a freedom of information request by The Times revealed that local councils across the UK have spent around £400 million on consulting firms in the last year alone. According to the report, this represents a rise of more than a fifth since 2014, with critics using the figures to call into question the value added by engaging external expertise.

Commenting on the criticism many councils face, Tamzen Isacsson Chief Executive, Management Consultancies Association, said, “Consultants play a vital role in the public sector, [providing] transformational impacts, innovation and increased efficiency… Vital front line services continue to operate uninterrupted [while] consultants often help local authorities get better results with less money. As the MCA awards this year demonstrate consultants are delivering social benefits across the UK – from work on getting better outcomes for children in care to finding better processes for finding homes for vulnerable families in London these examples offer a true reflection of the consulting excellence that operates across the UK to the benefit of councils and the wider society.”