web analytics

Redundancies, consultants, professional development

Written By: - Date published: 9:46 am, September 12th, 2012 - 12 comments
Categories: accountability, national - Tags: ,

National is the party of stupid, short term thinking. It’s evident everywhere, even in areas of supposed Nat strength like sound business management. Consider for example the abject folly of sacking a bunch of staff, and then running up $1bn in consulting fees:

Govt depts clock up $1bn in consultant fees

Government departments which have spent millions in laying off staff are responsible for nearly $1 billion in consultants’ fees.

Figures provided by the Labour Party showed ten agencies have spent $910.5 million on contractors since 2008 while also spending $114.1 million on redundancies.

The restructuring of the Inland Revenue Department (IRD) had seen departing staff collect $31.3 million in redundancy payments before contractors were hired at a cost of $125 million.

There are further case studies reported here, but carrying on with the above coverage:

Labour’s State Services spokesman Chris Hipkins said the figures made a mockery of National’s claim that it was moving resources from the back office to the frontline.

“The public service has already lost a huge amount of valuable expertise and experience and is simply plugging the gap by hiring consultants. “This is short-term thinking and it doesn’t make sense. We must invest in and value institutional knowledge.”

Exactly.

While in Opposition, National was highly critical of Labour’s failure to keep consultancy fees under control.

Finance Minister Bill English said the contractors had been employed for work which the public service had neither the funding nor the expertise to do. He said specialist skills were needed for the rebuild of Christchurch, the design of the Deposit Guarantee Scheme, and on multi-billion dollar IT projects.

“We just don’t have public servants sitting around who know how to redo the 25 year-old tax collection system,” he said.

Every government needs, and has used, a certain amount of external consulting support. But mass redundancies, then hiring some of those people back as expensive consultants, and running up a billion in fees, makes no kind of sense at all. If essential expertise doesn’t exist within an organisation then the sensible alternative to redundancies and external consultants is internal professional development.

Here’s the real question for the Nats’ management of the public sector – has there been a cost/benefit analysis of professional development for existing staff vs redundancies and external consultancy? If so, let’s see it. If not, then they’re throwing money down yet another ideological drain.

12 comments on “Redundancies, consultants, professional development”

  1. King Kong 1

    The consultants would have been hired anyway (maybe not the restructuring ones).

    The civil service became gutless under Labour and no one wanted to make any decisions without a Mckinsey or Deloittes report to cover their jacksies with if it all turned to custard.

    In the civil service I would say there is a mix of scared clever people and institutionalised morons outsourcing their jobs whilst still collecting a salary.

    • Colonial Viper 1.1

      We need to strengthen the public service and root out the inconguous, low value added private sector managerialism which has taken hold.

  2. Tracey 2

    “The consultants would have been hired anyway”. Proof?

    • mike e 2.1

      last time national were in power they did exactly the smae thing sacked public servants re hired them as consultants and also hired National party hacks at exorbitant rates.
      Shipley in CHCH.
      Repeat !National got up to $800 million in consultants last time they were in powewr heading the same direction again

  3. Consultant 3

    Keep an eye out for the All Of Governement deals. Ostensibly these deals get the governement economies of scale with regard to purchasing of services across departments. In effect, several large companies are going to lock the governement into contracts that look good price-wise up front but will end up being a rort through the use of “extras”. Where a company cannot profit from a service to the government, they will, of course, just reduce the quality of their service to the point where the departments will fulfill their own requirements internally. Penalty clauses will never be enacted. Many of the smaller companies, that offered some competition, will just go to the wall.

    Witness the current out-sourcing agreements, where “hosting your old IT equipment” is sold as “move to the cloud”. We’ll come and collect all that gear, chuck it in our flash datacentre and send you a monthly invoice. Thanks. You get the same services you had, with the extra cost of hosting.

    The public lap up the reduction of public servants (almost as popular as bene-bashing), they just don’t see that the flipside is an increase in consultants because the work still needs to be done, and the cost comes from a different magical accounting pot. Where a public servant actually cares about the job they are doing, the contractor is basically a mercanary.

    I know, cos I is one.

    • Colonial Viper 3.1

      Yeah its a merry band, I used to have to work with a few from time to time. Good peeps, in general, doing work at thrice the price (although the Partners were the ones who kept most of the money).

    • tc 3.2

      The sheeple also don’t understand that a core of competant and experienced civil servants ensures the wheels don’t fall off and gov’t policy can get done more effectively.

      The Nat’s had to get rid of this troublesome lot as it would of obstructed their ‘vision’ with practical experience about how and why it needs to be done a certain way.

      NACT the party of short termism for their own long term wealth outcomes.

    • prism 3.3

      Consultant
      We know that consultants are people too! And very useful except at present it’s the silo pots that money is divided into – no for more staff, no money, but the work needs doing, hire a consultant at a day’s wages per hour about. And that somehow can be paid for – out of where? But that’s how it’s done folks.

    • muzza 3.4

      And imagine what the rort looks like when its applied across the local govt sector etc!

      Yeah the consultants certainly rule the roost inside most departments of the “super city”, thats for sure.

      Consultants running “transformational activities”, simply translates into consultants ensuring their troughing into the future. All hired by consultant mates of course, because the working history of relationships is very easy to establish in little “non corrupt” NZ!

      Who loses, we all do of course, even the consultants, they just don’t understand the negative impact still applies, just on a time lapse.. While a little slower, the pain will arrive on their doorstep too!

      Its the world we live in sadly!

  4. lenore 4

    we are being restructured at the moment after a consultant was brought in – they obviously didnt know how we operate and the rationale is really flimsy.

  5. Where are the publicly-available ‘Registers of Interest’ – that help prevent untoward ‘conflicts of interest’ between those hiring these ‘consultants’ and those ‘consultants’ who have been hired?

    Penny Bright
    ‘Anti-corruption campaigner’

    http://www.dodgyjohnhasgone.com

  6. Lanthanide 6

    Seems to me that Labour should do as ACT proposed – put a law in place to cap government spending. Except Labour’s version would be to cap spending on consultants, and if the government wanted to increase spending on consultants, the minister of finance would have to front in parliament to receive permission to do so.

Recent Comments

Recent Posts

  • Positive plan secures victory
    The victory of Labour’s newest MP, Michael Wood, in Mt Roskill is the result of a well-organised campaign run with honesty and integrity, says Labour Leader Andrew Little. “I congratulate Michael Wood on his great victory. He will be a ...
    1 day ago
  • Wave of support for Kiwibuild continues to grow
    Apartment builder Ockham Residential has become the latest voice to call for the government to build affordable homes for Kiwi families to buy, says Labour’s housing spokesperson Phil Twyford. “Helen O'Sullivan of Ockham has now joined prominent businesspeople like EMA ...
    2 days ago
  • Cuba Si Yankee No – Fidel Castro and the Revolution
    The death of Fidel Castro is a huge historical moment for the older generation who grew up with the toppling of Batista, the Bay of Pigs debacle, the death of Che Guevara and the US blockade against Cuba. For younger ...
    GreensBy Catherine Delahunty
    2 days ago
  • Government slashes observer coverage, fails snapper fishery
    The Ministry for Primary Industries (MPI) has more than halved the number of fisheries observers in the East Coast North Island snapper trawl fishery (SNA1). This reduction in observer days, combined with major failures in an unproven and controversial video ...
    GreensBy Eugenie Sage
    3 days ago
  • ‘Exemplar’ Māori Land Court under siege
    TheMāori Land Court, hailed as an “exemplar” by the Ministry of Justice chief executive and Secretary, Andrew Bridgman is under siege by the Government through Māori land reforms and a Ministry restructure, says Labour’s Ikaroa-Rāwhiti MP Meka Whaitiri. ...
    3 days ago
  • He Poroporoaki ki a Te Awanuiārangi Black
    Kua hinga he whatukura o Tauranga Moana. Kua hinga rangatira o te iwi Māori. Ka tangi tonu ana te ngākau nā tāna wehe kei tua o te ārai. E rere haere ana ngā mihi aroha o mātou o Te Rōpū ...
    GreensBy Marama Davidson
    3 days ago
  • CYF reforms ignoring whānau based solution
    When approximately 60 per cent of children in state care are Māori processes need to change in favour of whānau, hapū and iwi solutions, said Labour’s Whānau Ora spokesperson Nanaia Mahuta.  “Widespread concern about Government reforms of Child Youth and ...
    3 days ago
  • Hip and knees surgery takes a tumble
    The statistics for hip and knee electives under this Government make depressing reading, says Labour’s Health spokesperson Annette King.  “Under the last Labour Government we achieved a 91 per cent growth in hip and knee elective surgery. Sadly under this ...
    3 days ago
  • Parata’s spin can’t hide cuts to early childhood education
    No amount of spin from Hekia Parata can hide the fact that per-child funding for early childhood education has been steadily decreasing under the National government, Labour’s Education spokesperson Chris Hipkins says. “In the 2009/10 year early childhood services received ...
    3 days ago
  • Nats will jump at chance to vote for KiwiBuild Bill
    National will welcome the chance to vote for a real solution to the housing crisis after their many, many failed attempts, says Labour MP for Te Tai Tokerau Kelvin Davis. Kelvin Davis’s Housing Corporation (Affordable Housing Development) Amendment Bill was ...
    3 days ago
  • Million dollar houses put homeownership out of reach of middle New Zealand
    35% of New Zealanders now live in places where the average house costs over a million dollars, and it’s killing the Kiwi dream of owning your own place, says Labour’s housing spokesperson Phil Twyford. Latest QV stats show that Queenstown ...
    3 days ago
  • Opportunity for political parties to back Kiwi-made and Kiwi jobs
    The First Reading in Parliament today of his Our Work, Our Future Bill is a chance for political parties to ensure the government buys Kiwi-made more often and backs Kiwi jobs, says Leader of the Opposition Andrew Little. The reading ...
    4 days ago
  • Solid Energy must open the drift
    Solid Energy is showing no moral spine and should not have any legal right to block re-entry into the Pike River drift, says Damien O’Connor MP for West Coast-Tasman.  “Todays failed meeting with  representatives from the state owned company is ...
    4 days ago
  • 20,000 at risk students “missing”
    A briefing to the Minister of Education reveals 20,000 at-risk students can’t be found, undermining claims by Hekia Parata that a new funding model would ensure additional funding reached students identified as at-risk, says Labour’s Education spokesperson Chris Hipkins. ...
    4 days ago
  • Crime continues to rise
    Overall crime is up five per cent and the Government just doesn’t seem to care, says Labour’s Police Spokesperson Stuart Nash. ...
    4 days ago
  • Treasury fritters $10 million on failed state house sell off
    The Treasury has wasted $10 million in two years on the National Government's flawed state house sell off programme, including nearly $5.5 million on consultants, says Labour Finance spokesperson Grant Robertson. "New Zealand needs more state housing than ever, with ...
    4 days ago
  • National slow to learn new trade lessons post TPPA
    Yesterday, the Minister for Trade misused economic data in order to try to make the case for more so-called ‘trade agreements’ like the TPPA which are actually deregulatory straitjackets in disguise. In welcoming a Ministry of Foreign Affairs and Trade ...
    GreensBy Barry Coates
    5 days ago
  • Skilled migrant wages plummeting under National
    Wages have plummeted for people with skilled migrant visas working in low-skilled occupations, driving down wages for workers in a number of industries, says Labour’s Immigration Spokesperson Iain Lees-Galloway. “Documents acquired by Labour under the Official Information Act reveal that ...
    5 days ago
  • Child abuse apology needed
    The Government's failure to act on recommendations from Judge Henwood, based on years of work by the Confidential Listening and Assistance Service (CLAS) will further undermine any faith victims may have put into the process, says Labour’s Children’s Spokesperson Jacinda ...
    5 days ago
  • Reserve Bank again highlights National’s housing failure
    National’s failure to deal with the housing crisis in New Zealand is once again being exposed by the Reserve Bank today, in a scathing assessment of the Government’s response, says Labour Finance spokesperson Grant Robertson “Governor Wheeler is clearly worried ...
    5 days ago
  • Palm Oil Labelling: Possible Progress?
    On Friday, the Minister for Food Safety, along with her Australian colleagues finally looked at the issue of mandatory labelling of palm oil. We’ve been calling for mandatory labelling for years and we were hoping that the Ministers would agree ...
    GreensBy Mojo Mathers
    5 days ago
  • National: Fails to achieve
    The ineffectiveness of the National Government’s approach to schooling has been highlighted by the latest Trends in International Maths and Science Study (TIMSS) report released overnight, Labour’s Education spokesperson Chris Hipkins says. ...
    5 days ago
  • Faster into Homes – a new pathway for first home buyers
    This week Parliament will select another members’ bill from the cookie tin (I kid you not, it really is a cookie tin) and I’ve just launched a new bill I’m hoping will get pulled – to help people get into ...
    GreensBy Gareth Hughes
    5 days ago
  • Selling off our state housing stock isn’t working for NZers
    I want to end homelessness and ensure that everyone has a warm, safe, dry home. This National Government has let down New Zealanders, especially the thousands of New Zealanders who are struggling with something so basic and important as housing. ...
    GreensBy Marama Davidson
    5 days ago
  • Government needs to ensure fair deal on EQC assessments
    Kiwis affected by earthquakes might not get a fair deal if the Government pushes ahead with secret plans to let private insurers take over the assessment of claims, says Labour’s Canterbury spokesperson Megan Woods. “Under questioning from Labour the Government ...
    5 days ago
  • Key’s priorities the real ‘load of nonsense’
    The Prime Minister’s fixation with tax cuts, despite a failure to pay down any debt and growing pressure on public services is the real ‘load of nonsense’, says Labour Finance spokesperson Grant Robertson.  “We’re getting mixed messages from National. John ...
    5 days ago
  • Free Speech and Hate Speech
    Last week we were very concerned to hear that an Auckland imam, Dr Anwar Sahib, had been preaching divisive and derogatory messages about Jewish people and women during his sermons. It was a disturbing incident coming at the end of ...
    GreensBy James Shaw
    6 days ago
  • Young Kiwis struggling under record mortgage debt
    The Government needs to step in and start building affordable homes for first homebuyers now more than ever, says Leader of the Opposition Andrew Little. ...
    6 days ago
  • Tairāwhiti says No Stat Oil!
    Tairāwhiti says yes to a clean environment for our mokopuna today and for generations to come. Tairāwhiti are have a responsibility to uphold their mana motuhake over their land and their peoples and are calling on the Government to honour ...
    GreensBy Marama Davidson
    6 days ago
  • Swimmable Rivers tour – Ōkahukura/Lucas Creek
    When Environment Minister Nick Smith said in Parliament that some waterways – like Auckland’s Lucas Creek – are not worth saving because no-one wants to swim in them, he forgot to ask the locals we met last week who have put ...
    GreensBy Catherine Delahunty
    6 days ago
  • Wellington business relief package needs flexibility
    The Government’s Wellington business support package is welcome news but needs to be implemented so that all affected businesses get the help they need, says Labour MP for Wellington Central Grant Robertson. “Wellington businesses will be pleased that the Government ...
    6 days ago
  • EQC’s staff cuts show disregard for quake victims
    The Earthquake Commission’s stubborn insistence on slashing its workforce and its operational funding by nearly half shows callous disregard for victims of the Kaikoura earthquake and the thousands of Cantabrians still waiting to resolve claims, says Labour’s Canterbury spokesperson Megan ...
    7 days ago
  • Maori Land Court job losses must be delayed
    Māori Development Minister Te Ururoa Flavell must request that pending job losses at the Māori Land Court are put on hold until the Māori land reform process is resolved and the risk of losing centuries of collective institutional knowledge is ...
    7 days ago
  • Financial support needed for urgent earthquake strengthening
    The Government must provide urgent support to residents for important earthquake strengthening work so that it happens quickly, says Grant Robertson, Wellington Central MP.  "I support the call from Wellington Mayor Justin Lester to bring forward work to strengthen the ...
    1 week ago
  • Labour welcomes equal pay
    Labour has long appreciated the value of women’s work and welcomes the Government’s decision to address pay equity for women, say’s Labour’s associate Workplace Relations and Safety spokesperson Sue Moroney. ...
    2 weeks ago
  • Surgeons’ letter a damning indictment
    A letter from Waikato Hospital’s orthopaedic surgeons claiming that hospital managers are stopping them from making follow-up checks on patients is a damning indictment of the health system, says Labour’s Health spokesperson Annette King.  “It’s terrifying that one woman’s elective ...
    2 weeks ago
  • Out of touch Nats continue state house sell-off
    The Government should be focused on building houses for families to buy and more state houses for families in need, not flogging them off, says Leader of the Opposition Andrew Little. “National’s state house sell-off does nothing to help people ...
    2 weeks ago
  • Joyce drags feet while Capital businesses suffer
     Wellington businesses affected by the earthquake are continuing to struggle while the Government drags its feet on getting a business assistance package up and running, says Grant Robertson, Wellington Central MP.  “Steven Joyce needs to front up with an assistance ...
    2 weeks ago
  • Health and Safety Act fails to reduce work fatalities
    After the Pike River tragedy, New Zealanders realised that workplace health and safety culture needed to change. Last Saturday marked the 6th anniversary of the tragedy that killed 29 miners at the Pike River mine on the West Coast of ...
    GreensBy Denise Roche
    2 weeks ago
  • What is the point of education?
    The proposed Education (Update) Bill is the Government’s statement about what the point of education is, and what it means to people. This week we had a day of Select Committee hearings in Auckland on the Bill. It’s a huge ...
    GreensBy Catherine Delahunty
    2 weeks ago
  • Earthquake exposes training shortfall
    Kaikoura’s earthquakes have exposed the Government’s under investment in critical building and construction skills training, says Labour’s Building and Construction spokesperson Phil Twyford. “The Government needs to urgently ramp up the training of Kiwis in construction and engineering in the ...
    2 weeks ago
  • More cops needed to get P off our streets
    National’s cuts to Police funding and drug enforcement officers has seen a surge in cheap P on our streets, says Labour’s Police spokesperson Stuart Nash. ...
    2 weeks ago
  • Who’s calling the shots? Bye bye surplus
    I would love to know who is calling the shots in the National government’s cabinet when it comes to deciding how best to spend taxpayers’ money.  On the evidence of the last few weeks, it definitely isn’t Finance Minister Bill ...
    GreensBy David Clendon
    2 weeks ago
  • Urgent rethink needed on workplace safety
      An urgent rethink is needed on the Government’s new workplace safety laws with the number of deaths this year already at the same level as at the same time in the 2015 calendar year, says Labour’s Associate Workplace Safety ...
    2 weeks ago
  • Rubble and rubbish: spending time in post-quake Kaikōura
    I visited Kaikoura over the weekend – basically to see how the community was coping with all the rubbish and rubble created by last week’s 7.8 magnitude earthquake, and to see my brother Rob. I may have mentioned before that ...
    GreensBy Denise Roche
    2 weeks ago
  • Time to pull the plug on state house sell-off
    The collapse of the planned sell-off of state houses in Horowhenua is an opportunity for the Government to call time on its troubled state house sell off policy, says Labour’s housing spokesperson Phil Twyford. ...
    2 weeks ago
  • Treasury sounds warning bell – but National’s not listening
    Today's long term fiscal outlook issued by The Treasury is a welcome wake-up call on the need to dramatically improve and diversify our economy and properly plan for the future, Grant Robertson, Labour’s Finance Spokesperson says. “Through our Future of Work ...
    2 weeks ago
  • Don’t believe the hype – debt has skyrocketed under National
    The reckless dangling of tax cuts by the National Government is all the more irresponsible when it is put alongside the failure to pay down debt or put money aside for future superannuation costs, says Labour’s Finance Spokesperson Grant Robertson. ...
    2 weeks ago
  • Our kids deserve better
    We don’t know how many children are affected by having learning support needs. I do know that far too many children are not getting the support they deserve for conditions like autism, dyslexia, and dyspraxia. When these conditions are not ...
    GreensBy Catherine Delahunty
    2 weeks ago
  • Talk of tax cuts is plain crazy
      John Key’s talk of tax cuts when the Government has $63 billion of debt, superannuation costs are rising by $1 billion a year and the cost of meeting another natural disaster, is just plain crazy, says Labour Leader Andrew ...
    2 weeks ago