Are private consultants to blame for Australia’s botched vaccine rollout? As a feud erupts over delays about the vaccine, private contractors have so far avoided scrutiny.
Big multinational consulting firms like McKinsey, PwC and Accenture have all made millions in lucrative contracts to assist the government’s rollout.
But more than a month in, the vaccine rollout has been characterised by sluggishness and inefficiency. We’re more than 3 million doses behind schedule, and state and federal governments are at war over who is responsible for the mess we’re in.
By the numbers
Tender documents go some way to revealing the extent to which the vaccine program has become a honeypot for big consulting firms, despite their lack of experience running national health programs.
McKinsey and Co is the latest to be brought in to advise the vaccine taskforce after PwC was appointed last year. The Australian arm of the global firm was awarded $1.6 million in February to provide support services for the vaccine rollout between February 25 and March 26 — an equivalent of almost $57,000 a day.
So what exactly has it been doing?
There are few details about the contract except that it was to provide “information technology consultation services”. And in typical private sector style, it has been completely mum on the details of its work, telling the ABC that it doesn’t comment on “client matters”. The company did not respond to questions from Crikey by deadline.
It’s not the first vaccine contract McKinsey has scored in Australia. It also won a separate gig for another month’s work for the Department of Health in August last year to provide “strategic planning” regarding the vaccine treatment strategy. That contract was worth $660,000 — or $22,000 a day.
Ernst and Young (EY) has also clipped the ticket, with a $557,000 contract to evaluate Australia’s COVID vaccine “readiness”. That contract runs until June.
Accenture will get a staggering $7.8 million for tracking of vaccine doses, program implementation and monitoring. And while PwC was made a program delivery partner, the value of its contract with the federal government is unclear. The details aren’t available on AusTender and, when asked about it, a spokesperson told us they don’t comment on client matters.
The PwC contract highlights the considerable lack of clarity about the role of consultants in the vaccine program. The deals with Accenture and PwC (value currently unknown) were announced by Health Minister Greg Hunt on Christmas Eve last year, with little of the usual fanfare brought in for vaccine updates. Both McKinsey contracts were announced quietly.
We’ve got little idea what these companies actually do or whether that money is well spent — let alone whether they should be handling such a critical phase of our response to the pandemic at all.
Dr Stephen Duckett, director of health programs at the Grattan Institute, said the lack of transparency around what work the consultants were doing was concerning.
“There needs to be public reporting of what advice they are giving because it’s public money,” he told Crikey.
Writing in The Sydney Morning Herald, economists Steven Hamilton and Richard Holden suggested consulting firms used to penny-pinching are unsuited for the kind of necessary spending needed during a vaccination drive.
McKinsey in the gun
Australia isn’t alone in outsourcing its vaccine rollout to the big consulting firms. These same companies have come under fire overseas for their failures in assisting the vaccination drive.
McKinsey has been the target of widespread criticism in France for being behind extensive delays to the vaccine rollout. The country is set to enter another four-week lockdown with a devastating new wave of cases.
In February, President Emmanuel Macron admitted he had turned to outside consulting firms to help manage the response. This prompted lawmakers to pose questions as to why McKinsey, a global consulting firm, had been tasked to support French agencies charged with rolling out the vaccine.
In a letter, furious lawmakers mentioned McKinsey’s recent agreement to pay nearly $600 million to authorities in the US to settle claims over its role in contributing to the “devastating opioid crisis” as one reason to be skeptical of its involvement in the vaccine program.
In December, the firm’s Australian head Angus Dawson addressed staff at a Zoom meeting where he offered a tepid half-apology for McKinsey’s role in the crisis.
Considered the doyen of big consulting firms, McKinsey’s client list — from Purdue Pharma (the maker of opioid oxycontin) to the Saudi government — has a shroud of villainy. But the company is also something of a breeding ground for the powerful: federal ministers Angus Taylor and Greg Hunt are both McKinsey alumni.
Each year, it rakes in government contracts, restructuring agencies and eating away at what was once the public service.
Crikey asked the Health Department whether the outsourcing of work to private consultants like McKinsey was to blame for delays in the rollout, and what it was doing to avoid the same mistakes in France. We also asked for a complete list of the consultancy firms that have been contracted out to help roll out the vaccine. We’re yet to get a response.
Why does the Government and the Public Service think these glorified accountants and MBAs* know anything about logistics and vaccinations, or actually running an enterprise? Why do they turn to them constantly? Is it because the value of anything is now reduced to simply what it costs, and how that cost can be reduced?
*Masters of Bu88er All.
My last experience with these consultancy firms was being introduced to 2 twenty something MBA graduates who would have know nothing at all, who examined a program where I probably knew as much about it as all but a couple of people in a very large uni, and they didn’t interview me or set up any meetings, then a report was written (blanks filled in on a pro-forma report I assume) and a bill came to us for north of $20M. I kid you not.
20M?? Chickenfeed! Under Howard’s ATO Commissioner, the so-called Change Program initially costed at a couple of hundred million ended up in the billions, although we’ll never know exactly how much because of the lies and distortions of both the government and the ATO.
Wasn’t that Accenture?
Yep. But let’s not just blame the consultants. It was a sleazy understanding between consultants and public service management. Having gutted any operational expertise, JH and management had a perfect excuse to hire consultants (at unbelievable rates- well over $100/hr) whose own expertise was also very thin. This then allowed these managers to promote themselves as “experts” and raise their salary. Let’s hope someone will one day expose this disgusting collaboration in greater detail.
EVery year a vaccine programme gets delivered to Australians. It’s the flu programme. Why can that successful approach not be replicated? Why can the military with its logistics corps not be tasked? Why must money be given away to high priced ‘watch borrowers’ when we already own or have systems that work?
“Why can the military with its logistics corps not be tasked?”
What you really mean is why can’t the military be used to force people to take the vaccine. And lets not forget the “re-education” camps for those who resist. Nice.
Idiot reply.
Just keep those down-votes coming. It confirms that I am doing something right.
Do you live in bizaro world full time,or do you get time of
Enjoy your dog day afternoon. Btw, i get time off but not time of.
Do you have a GPS for those camps?
Red pill blue pill guy, our Craig.
Oh Andrew, it’s the green pill, silly.
No, it’s not even the green pill. It’s the red pill…blood clots. Are you happy now?
Do you have a GPS for your brain? I can’t seem to find it.
Do you have a GPS for blood clots?
Military logistics in Australia is not equipped to manage such a large program into australia’s medical infrastructure. It would be more appropriate to use the experts from Toll Group or Linfox. I know, corporate. But they’re the experts in australian logistics and would leave the Australian Defence force for dead in this respect.
The influenza progamme is being used a baseline. This programme is 10X the size and has vaccines with more difficult storage requirements.
As all of the contracts are “Commercial in Confidence”, we will never know how much of these payments are being “donated” to some branches of the Liberal Party via the under $14,000 per donation AEC reporting condition.
Donations should be limited to $1,000 per donation per year, no sneaky donations using different branches–with different company names.
And to the party, not an individual – that’s another sneaky move.
Of course it’s ‘sneaky’ – it was devised by the Lying Rodent hissownself.
It is pointless trying to control donations, inout or income – that’s why Euroland has had a GT/VAT/MoMs for decades.
The only way to validate an income is expenditure.
As F.Scott.Ftz said, “the Rich are different..” but the only way we know that is that they SPEND.
Tax expenditure.
End. Of.
Well this year the flu rollout is patchy at best, I was lucky to get the last dose but they have no idea when the next batch will arrive.
There is a history to this situation. The hollowing out of the Public Service got a real boost when John Howard became PM and the process has escalated in recent times.The idea that a ‘big global consulting firm’ must be a better option than a lean, informed local group is still alive. I have no idea why this belief still exists. The global firms have a sordid track record of missing the bleeding obvious, examples include EY and the Wirecard collapse. The rebuilding of the expertise within the Public Service should be a priority for all governments.
“The rebuilding of the expertise within the Public Service should be a priority for all governments.”
Yes, but, please, not this government. They would only cock it all up and reduce us all to beggary.
For quite a lot of people, they have already been reduced to beggary.
With this lot it would have been terrified of people knowing and being smarter than them, which would be why they said the public service must be directed by them- and that’s why they prefer to pay outsiders who know damn all yet expect them to make this incompetent and corrupt government look as if they are doing something. I nearly put “look good” but there’s not enough money on this planet to do that.
The Australian public service was world class – until commencing from Hawke/ Keating era followed by Howard and successors – all the others introduced political hacks into positions. We tried to emulate the USA where each President appoints his own supporters at the beginning of their term. All the President appointees know it is a short term appointment – but they all are usually well qualified compared to our political hacks. So we have a public service unable to cope – with consultants who haven’t a clue.
When I read of a company that has appointed consultants – usually when a new CEO arrives then I immediately sell the shares in the company. It shows that the new CEO hasn’t a clue about the industry he has now landed in. I pity Canberras professional public servants they must despair or try to join a consultancy.
Excellent comment.
Again, any examples of Hawke and Keating hollowing out the public service? I gave the example of Howard sacking 1/3rd of the dept heads when he came in. Who did Hawke or Keating clean out?
You might try Elizabeth Humphrys, How Labour Built Neoliberalism, (Haymarket Books, Chicago, 2019). I have just begun reading it. Ch.5 of my book Mythologies of Change and certainty in Late Twentieth Century Australia, (ASP, Melbourne 2000) is also about consultants and is largely based on what happened during the Hawke/Keating years.
I also remember it was Labor who introduced HECS for university students, thereby abolishing free tertiary education. And look where that went to. Now we have McDegrees and unemployed people with several of them each – but who cares when all that $$$ is going to the bureaucrats for it (while academic staff are increasingly casualised and underpaid). Thank you Labor. Not that the Liberals do any better on this, of course.
And – superannuation – another way to feed lots of citizens’ money into the accounts of its wealthy administrators – and how long did it take before you were even allowed to choose your own super fund, and how many entry and exit fees did you pay to roll things into your next employer’s choice of account…
Elizabeth Humphrys book is a wonderful publication, well researched & she reasons well how the unions and the once great party, the Australian Labor Party were seduced by “neoliberalism”.
Let me also add to the replies by Gregory Bailey & SueC with another example.
In 1992 Keating tasked Fred Hilmer to develop a National Competition Policy. This would be the tool that would be used to “corporatise” the public sector by Keating and then Howard.
This would force government departments and social services to compete with each other and the private sector for funding through competitive tendering.
The mess we find ourselves in now, together with the resulting loss of the public service expertise and knowledge can undoubtedly be traced back to the Hawke/ Keating era.
“a spokesperson told us they don’t comment on client matters” – srsly?! – we, the taxpayers, are the feckn clients – tell us, or hand back the money