Consultancy blowout

Written By: - Date published: 10:16 am, April 12th, 2012 - 34 comments
Categories: accountability, national, public services - Tags: , ,

Cut the public service to save money and what happens? Well, lots of things, but one of them is that you end up spending more money on consultants. Surprise surprise:

Spending on consultants rises under National

Some government departments have tripled their spending on consultants during the National Party’s time in power, despite assurances from the Government that it was not depending more heavily on contractors.

The Treasury was one of the biggest spenders, increasing its payments to consultants from $1.4 million in 2008 – Labour’s last year in charge – to $8 million in 2011.

The Ministry of Agriculture and Forestry (MAF) tripled its consultancy fees in this time frame to $12.6 million.

The Environment Ministry was the biggest user of consultants, clocking up $15.7 million in fees in 2011, nearly one-third of its total budget. …

Labour Party State Services spokesman Chris Hipkins said increased spending by some departments was the inevitable result of laying off public service workers.

“It doesn’t surprise me because at a time when the public sector’s being cut the [government’s] effectively being forced to use consultants or contractors, instead of employees, because they have this arbitrary cap which says you can’t employ new staff.”

He was concerned that in some cases public servants were losing their jobs, often with redundancy pay, before being rehired on higher wages.

“What this shows is that the Government’s cap of the number of staff isn’t actually saving the taxpayer money. If anything, it’s probably costing the taxpayer more.”

Brilliant. Economic bungling with a side order of hypocrisy:

While in opposition, National was highly critical of Labour’s failure to keep under control its consultancy fees, which were $111.9 million in the party’s first year of office.

Of course there’ll be plenty of excuses as to why it’s “different” now that the Nats are in power.

(As a final note on The Herald piece quoted here, it also includes this note:

The data on consultant expenditure was released to freelance journalist Keith Ng under the Official Information Act.

Indeed it was, and it would have been polite for The Herald to link to it. The original blog on it is here – more excellent work from Keith Ng.)

34 comments on “Consultancy blowout”

  1. Roy 1

    I know for a fact that at least some of those MAF consultancy fees have been paid to former MAF employees who were laid off as part of the cutting back of public servants.

  2. Draco T Bastard 2

    You know, people shouldn’t be surprised at this. It’s exactly the same thing that happened last time NACT were in power – cut government departments and massively increased consultants to try and cover for the lack of capability caused by the cuts.

  3. Colonial Viper 3

    Its way better to give the tax payers money to mates in National friendly consultancies, as opposed paying those bloody minded “Neutral” public servants.

    • Hennie van der Merwe 3.1

      I am truly amazed that more is not made of this very obvious ploy to disadvantage workers and benefit business buddies.
      It would also be very interesting to look at the results (or reports) of these consultants and compare these with the costs involved.

  4. Tombstone 4

    It just goes to show you just how two faced National supporters really are when they denounce everything and anything that favors ordinary hardworking Kiwis and their families but praise the living shit out of anything and everything their beloved National Party does regardless of who their policies hurt and the vindictive nature behind them. They berated Labour to no end about the amount being spent on consultants but now that National are in power it would seem that spending even more (in some cases three times as much) is okay? There is no other way to describe it really. National supporters it would seem are no more than a bunch of seriously deluded, ignorant two faced pricks.

  5. Balanced View 5

    Is it fair to note that a proportion of the consultancy spend was on unforeseen events like the Christchurch earthquakes and Pike river tragedy?
    Also, is there somewhere we can view the total paid in staff costs and consultant fees, to establish exactly what the blow out is?

    • Draco T Bastard 5.1

      Is it fair to note that a proportion of the consultancy spend was on unforeseen events like the Christchurch earthquakes and Pike river tragedy?

      No, because those events should have been planned for.

      • Balanced View 5.1.1

        You’re kidding right?

        • Draco T Bastard 5.1.1.1

          Nope, government ministries should have been able to handle them as a matter of course. Yes, that means that government ministries need to be bigger. They would still have needed to hire in more people to do the work but they shouldn’t need to hire in consultants to cover what is obviously a role of government.

          • Balanced View 5.1.1.1.1

            So you’re differentiating between addition staff and consultants? Because they’re such rare occurrences it makes far more economic sense to call on experts as and when required, as opposed to paying for them full-time for 25 years until the next major earthquake.
            Does anyone know if consultants were used in either of these events?

            • Descendant Of Smith 5.1.1.1.1.1

              National are known for laying off public servants and hiring consultants.

              But lets take one well known consultant related to the earthquake – Jenny Shipley.

              Can anyone tell me what she has actually done or what value she has added?

            • Colonial Viper 5.1.1.1.1.2

              Because they’re such rare occurrences it makes far more economic sense to call on experts as and when required

              Look moron,

              Apart from the classic right wing bullshit of using the term “economic” when you merely mean “financial”:

              These “experts” don’t magically appear when you need them, and then at a click of your fingers, disappear when you don’t. There isn’t a pool of spare “experts” moping around waiting for your txt message. You have to train them, build up knowledgebases and expertise, have them create systems and proficiencies BEFORE you need them.

              If we don’t build up this country’s reserve capabilities soon we are going to be very sorry.

            • Draco T Bastard 5.1.1.1.1.3

              Government has a requirement to have experts* on hand all the time researching what could possibly happen and updating plans on that research. The problem with the present system is that the “experts” probably know less about what to do than the average joe on the street.

              * The way to become an “expert” is to do the damn stuff all the time – not only after disaster happens which is what we have now. Those consultants aren’t experts – not by any stretch of the imagination.

            • Balanced View 5.1.1.1.1.4

              So should we invest in training up experts in say, Nuclear fallout, snake infestations, or any one of another trillion unlikely events?

              • prism

                Are you serious or just passing time till your favourite tv show comes on?

              • Colonial Viper

                Listen up dumbass

                Its not the probability of an event which is most important, it is the magnitude of the consequences.

                Further, a severe earthquake in NZ is not an “unlikely event” it is a damn certainty.

                Dumbass.

              • fender

                Apart from the silly extreme element to your questioning, some experts are needed in snake infestations in this NACT Govt presently.

              • Carol

                We do it already for earthquakes:

                http://www.eqc.govt.nz/research.aspx

                One of EQC’s roles is to facilitate research about natural disaster damage, methods of reducing or preventing natural disaster damage, and the insurance provided under the Earthquake Commission Act. EQC research aims to reduce the Crown’s liabilities arising from geological hazard events and to make communities more resilient to such events.

                EQC contributes to national capability building and fosters research in relevant areas of earth science, engineering, architectural design, building technologies, social science and emergency management. Elements of this strategy include:

                More on what EQC does in the area of research to aid preparation for such disasters at the url.

                • Balanced View

                  So I wonder what “expertise” any (if any) consultants provided? Understanding this would help all of us gain some perspective as to whether or not the better financial (happy Viper?) decision is to hold these positions permanently or bring them in when required.

              • Draco T Bastard

                We would train up and keep experts on that which is most damaging and likely to happen. Pike River shouldn’t have happened as we should have had adequate safety inspectors which we didn’t because the 4th Nat government decided they were too expensive.

                • Balanced View

                  We might already have trained experts. Too difficult to judge until we know what skills were brought in.
                  As for your comment about Pike River – speculative and unhelpful

                  • felix

                    It’s not as speculative as you think. In fact it’s exactly what every mining expert and particularly mining safety expert seems to be saying.

                    But who needs experts eh? We’ll just get them in after the fact, as agreed.

                    • Balanced View

                      That’s not an accurate statement felix.
                      And my point, is that presently, none of us seem to be in a position to accurately judge whether the “consultancy blow out” is good, bad, or indifferent, from either a financial or preparedness perspective.
                      I understand that this is an anti national site, but the propensity for many here to immediately condemn any decisions or past policy is what causes me to say that there is little difference in balance, fact, and extremism between here and Whale Oil.

                    • Draco T Bastard

                      And my point, is that presently, none of us seem to be in a position to accurately judge whether the “consultancy blow out” is good, bad, or indifferent, from either a financial or preparedness perspective.

                      It didn’t work last time NACT tried it in the 1990s (that’s why Labour had to spend 9 years rebuilding the public service) and so we know that it won’t work this time either.

                      …but the propensity for many here to immediately condemn any decisions or past policy is what causes me to say that there is little difference in balance, fact, and extremism between here and Whale Oil.

                      Um, what?

                      We’re looking at what has actually happened and pointing out that it wasn’t optimum and that better policies are needed. That’s actually very balanced. WO and the rest of the RWNJs just spout what they believe happened – after going to considerable effort to make it up in the first place – and then putting in place the same policies that failed last time.

                    • Balanced View

                      DTB, so because something didn’t work 20 years ago it won’t work now? And is the process being used here identical to that used then?

                      DOS, I don’t doubt what you’ve said here.

                      However, What we don’t know (unless some of you have this information) is;
                      1. what skill sets the consultants brought in
                      2. how quickly they were able to provide the assistance in order to provide meaningful and timely assistance
                      3. How the costs stacked up vs having full time paid experts on call

                      Potentially, all critical skill sets were retained and key decisions were made accurately in a timely manner, and consultants were brought in to provide non critical support, and all for a lower cost than having maintained higher staffing levels.

                      We/I don’t know either way at this stage.

                    • Colonial Viper

                      BV = Dreamer

                      Government spending on consultants blew out because that’s how National helps its mates.

                    • Balanced View

                      Colonial Viper = speculator
                      Whale Oil = speculator

                      Gee, I wonder why I make the assertions I do about the similarities in these two sites?

                    • Draco T Bastard

                      DTB, so because something didn’t work 20 years ago it won’t work now?

                      In this case, no because it’s the same bloody morons putting it in place with the same policies and settings. In other words, it’s exactly the same and, as the saying goes, doing something the same way and expecting a different result is the definition of insanity.

                      However, What we don’t know (unless some of you have this information) is;

                      And the reason why that information doesn’t appear to be available is because NACT refuse to measure things.

                      When the left get back in they’ll have to rebuild the public sector again and that means retraining for all of the lost skills and abilities. There will be no way to get the experience back.

                    • felix

                      Ah, so BV is yet another one of these fucking retards who dismisses the fact that we’ve all seen this exact same shit before as if that had no bearing whatsoever.

                      A pile of horseshit balanced by a pile of bullshit. You’re all shit, mate, however you try to “balance” it.

                  • Draco T Bastard

                    We might already have trained experts.

                    Unlikely as the private sector doesn’t really do the same things as the government.

                    Too difficult to judge until we know what skills were brought in.

                    The “experts” brought most likely have an MBA. In other words, they have NFI WTF they’re talking about but they get big bucks anyway.

                    • Descendant Of Smith

                      Take civil defense as a good example.

                      Some of the public servants laid off have had many years experience in preparing for civil defense emergencies, being involved in exercises, building sustainable networks, and so on.

                      You may be unaware that these people do this work on top of their current jobs – they don’t get paid any extra for doing so and have a great deal of expertise.

                      When an event like Chch happened many of them unflinchingly got down there to provide support and help to the local people.

                      That’s what they do as a matter of course and it’s called public service.

                      Do you think that there is time in an emergency to find some private sector people, to decide what rate you are going to pay them, to train them on what they need to do, to understand civil defence protocols and procedures, and so on? It would be an abysmal failure.

                      Some of these people I know and you probably wouldn’t notice them if you passed them in the street.

                      I do however have great respect for the time and effort they put in to prepare for such an event and the knowledge that they have.

  6. Jenny 6

    Consultants that are getting $120 million a year from the taxpayer. Are some of these consultants sucking on the public tit, giving the government advice that it shouldn’t spend $150 million a year on mothers and babies?

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