Consultants are much happier away from the spotlight. Which is why it was interesting to see McKinsey and Boston Consulting Group (BCG) listed to front the Senate inquiry into Australia Post later today.
Turns out McKinsey was having none of it. The blue-chip firm, which has raked in millions in COVID-19 related government contracts, has “declined” to appear, Crikey understands — apparently on the grounds that it only received notice on Friday. The program has been updated to include former Australia Post executive manager Philip Dalidakis instead.
Neither McKinsey nor BCG made a submission to the Australia Post inquiry, which is examining the ousting of Christine Holgate as CEO. However BCG has been mentioned several times in relation to its work examining the privatisation of the government agency.
McKinsey’s addition was a little bit more mysterious. And its decision to decline raises even more questions. The company’s listing on the inquiry’s program over the weekend had reportedly sent chills down the spine of its other clients. But perhaps no one had more to fear than the government itself.
Crikey was hoping to see if any other areas of McKinsey’s work were discussed during the hearing, chaired by Greens Senator Sarah Hanson-Young — particularly regarding the lucrative contracts it has secured to advise the government on the botched COVID-19 vaccine rollout.
Those contracts include a $3 million deal with the Department of Health, as well as two contracts with the Department of Prime Minister and Cabinet worth $2.4 million and $206,000.
Crikey has been pushing for details on this work, particularly the contract with Health, after McKinsey made headlines in France over its role advising the government there on its own vaccine debacle.
At a cost of about $57,000 a day, taxpayers — most of whom are still waiting for a jab — have a right to know the basic details of the advice.
But even if we don’t get any answers, this serves as a pivotal moment for the consulting industry which has traditionally thrived in the darkness that the private sector — with its “commercial in confidence” mantra — affords it. It’s a moment that is well overdue.
Consultants have had their best year ever in Australia thanks to COVID-19. Federal government spending on consulting services last year eclipsed the $1 billion mark for the first time, according to industry website consultancy.com.au, rising from less than $980 million in 2019. McKinsey and BCG have been some of the big winners in this, doubling their recent government contracts in the past 24 months.
But now that they have to front up to Senate inquiries like humble public servants, will they think twice about the type of work they take on?
At the very least it should make them rethink their closed-door approach to taxpayer-funded work. Transparency experts say this has wrapped the government’s pandemic response in a cosy blanket of secrecy.
This is well and truly overdue, good on the greens for taking action time we get some equilibrium into federal politics and transparency into how our tax money is being spend
Consultants are beginning to look rather dodgy – could it be that the government tells them what they want?
The whole principle is one of finding the consultant most willing to conform to the predetermined expected result. It helps if the principals of the agency are also liberal party donors.
Apart from being very expensive, the use of so many consulting firms is an insult to the public service. If we don’t have public officials capable of doing this fairly basic stuff you have to ask why.
You could ask that, or you could just see it as the inevitable other side of the coin – as consultants grab ever bigger chunks of work and many $billions from the government, the public service is subjected to endless rounds of crippling cuts (disguised by the sick euphemism ‘efficiency dividends’) which leave it demoralised, deskilled and barely able to remember which day it is. Which all helps to justify giving even more work to consultants now that the public service can no longer tie its own shoelaces – which suits the government just fine. The consultants and ministers, hide behind commercial in confidence while looting and pillaging the Treasury, dividing the spoils, giving each other plum jobs and generally having the time of their lives, untroubled by any of those pesky public servants with their horrid tendencies to worry about the public interest or doing what’s right.
Of course it suits tjis bunch of duds “just fine”, the money from our taxes eventually cycles back to them as donations, and round and round it goes, where it stops will never happen until we change the government.
Corruption perhaps ?
Those capable public officials have been made redundant by the government that believes private consultancy is “better” and so is smaller government.
“Consulting – If you’re not a part of the solution, there’s good money to be made in prolonging the problem.”
It would be good to know what we are getting out of this arrangement, and why this issue was thought beyond the public servants in the department…
Government departments have a knack of ignoring the talent in their ranks. Something about the private sector being better, I think.
As a public servant I saw many consultants’ ‘final reports’ where I thought I could have nominated half a dozen of my colleagues who could have done a better job – at no nominal cost to the department. Sometimes I think the senior execs who approved the consulting arrangements got a woody just from seeing their own jargon spewed back at them in a semi-coherent way.
It seems to me that the ‘commercial in confidence’ demand covers a number of issues. I am particularly interested in the level of expertise of those who do the work in matters of public health and the processes of government delivery of services.
Of course the diminution of expertise in the public service means the loss of institutional memory. Each crisis is new and perhaps seems unique or unprecedented to consultants and overworked public servants neither of whom have any idea what happened in a past similar crisis – or worse don’t know there was a ‘last time’ or were to look in the records or wo to contact for a chat.