Value for money questioned in consulting firm's pandemic charity role

27 August 2021 Consultancy.uk 3 min. read
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Britain’s Government has pledged to examine the value for money provided by spending £2 million on consultants to assist with assessing bids made by charities for emergency funds. The news comes after a Parliamentary report found over £100 million of those emergency funds could not be accounted for.

In August 2020, the UK Government came under fire for its spending on private consulting contractors, after it emerged the industry had received contracts worth £56 million to help with the national response to the coronavirus. While that figure – and the criticism attached to it – has continued to snowball since, new controversies surrounding those initial awards are still coming to light, one year later.

Most notably, PwC – which received £7.4 million from those early contracts – has come under the microscope for its role in a six-month engagement to help run an emergency coronavirus fund for small charities struggling to survive the impact of Covid-19. The work was reported as being worth up to £1.4 million to the Big Four firm – but was also something charity leaders questioned the need for at the time.

Value for money questioned in PwC pandemic charity role

12 months ago, a report in the Guardian noted that more than 10,000 charities had applied for grants from the coronavirus community support fund (CCSF) for England, many of them struggling to survive the impact of the crisis on their regular fundraising. Despite this, scarcely a quarter of that £200 million fund was allocated to charities, and even less paid out at that stage. Voluntary sector leaders who had grown increasingly alarmed at the delay in allocating the cash subsequently reacted angrily to disclosure of PwC’s role in the vetting process.

Commenting on the situation, Debra Allcock Tyler, CEO Directory of Social Change, a leading sector training and support agency, said, “This is an absolute travesty. Our suspicion is that it is all to do with political decisions about which charities are approved of by the Government and which are not.”

With the coronavirus crisis having continued for longer than the Government had hoped, both the initial fees of the consultants, and the size of the pot for charities grew in the intervening period – however, it does not seem that charities warmed to the role the firm played. Earlier in the summer, a report from the House of Commons Public Accounts Committee (PAC) was published, criticising the Government for failing to provide “a clear rationale for spending up to £2 million of taxpayers’ money” on PwC’s assisting with the assessment of bids for more than £500 million in emergency funds offered to voluntary sector organisations.

PAC Chair Meg Hillier stated that “exorbitant funds” having been spent by consultants, without the impact being measured, was a recurring theme of the pandemic. She added that she feared a major impact of this would be “the steady erosion of taxpayers’ trust that their money is being well spent in this national emergency.”

The PAC report summarised the findings of the PAC’s inquiry into £513 million allocated to the Department for Digital, Culture, Media & Sport to help charities meet increased demand during the pandemic. The sum was part of the £750 million emergency funding package to help voluntary sector organisations during the pandemic, announced in April last year. As well as concluding the Government had failed to demonstrate value for money in the appointment of PwC, the paper also noted that the Government had no information on where more than £100 million in emergency Covid-19 support for charities had actually been spent.

In a response to the PAC report, the Government said the Department for Digital, Culture, Media & Sport would write to the committee within three months, setting out “how it judges the value for money of this contract and any lessons learned as to how and when it would apply a similar approach in future.” The department will also set out the amount of fraud which has taken place, and to what extent the missing funds have been recovered – but the Government still defended its hiring of the Big Four firm, arguing it had “met the relevant performance metrics at all stages.”