MoD fields army of consultants

November 18, 2011 1:59 PM

Today the Guardian reports that, while the MoD cuts the number of front-line troops, £564m has been spent on consultants in just two years. Spending has increased from £6m in 2006 to £267m in 2011 – a 4,350 per cent rise.

The huge increase has been blamed on the Framework Agreement for Technical Support (FATS), bought in by the Labour government in 2009, which allowed defence officials to hire specialist, short-term help without requiring a minister’s consent.

An MoD internal audit report claims there were "significant weaknesses" in the submission of business cases; that there were "weaknesses in the robustness of scrutiny" by budget controllers; and that three quarters of contracts were awarded without any notion of competition. Despite the laxity of the guidelines the report concludes that there was "no assurance" they were even being followed.

All options must be considered to ensure that services can be delivered at the lowest cost to taxpayers. There may be occasional situations where it is more cost-effective to hire consultants on specific projects than to have them employed full-time. In these circumstances we would expect robust guidelines to be in place; that they be rigorously followed and compliance monitored; and that appropriate sanctions would be deployed against individuals who broke them.

In the context of budget reductions of around eight per cent over the next four years, and the loss of 42,000 posts, we would expect the MoD to be doing everything possible to maximise the value taxpayers' get for their money, rather than relying on union reps to highlight gaping holes in their financial procedures.

 It is disingenuous for the MoD to be claiming to be cutting costs by reducing staff if external consultants are then bought in to do their job instead at a higher cost. They should be taking a more holistic approach to the costs of their projects which are already, in many cases, heavily over-budget.

Our Chief Executive, Matthew Elliot, had this to say:

“It’s appalling that the MoD has been managing its budget so catastrophically badly. This level of spending on consultants is disgraceful and worse still is the face that correct procedures were allowed to be so consistently ignored. Some larger or more technical projects may require consultants to be brought in for their specialist expertise, but this should be in moderation and should certainly be within the department’s own guidelines. Transparency and value for taxpayers’ money should to be at the heart of all Whitehall spending decisions, rather than the poorly planned, wasteful overspend that is plaguing huge swathes of the public sector. “


When questioned by the BBC the Defence Secretary, Philip Hammond, claimed claimed that tighter controls and a new framework now in place will ensure these costs are properly scrutinised in future. He compared reforming the MoD to manoeuvring an oil tanker and suggests that the "legacy of mismanagement is deep and will take some time to turn around."

Without fixing problems like this that ship will soon be heading into a storm.Today the Guardian reports that, while the MoD cuts the number of front-line troops, £564m has been spent on consultants in just two years. Spending has increased from £6m in 2006 to £267m in 2011 – a 4,350 per cent rise.

The huge increase has been blamed on the Framework Agreement for Technical Support (FATS), bought in by the Labour government in 2009, which allowed defence officials to hire specialist, short-term help without requiring a minister’s consent.

An MoD internal audit report claims there were "significant weaknesses" in the submission of business cases; that there were "weaknesses in the robustness of scrutiny" by budget controllers; and that three quarters of contracts were awarded without any notion of competition. Despite the laxity of the guidelines the report concludes that there was "no assurance" they were even being followed.

All options must be considered to ensure that services can be delivered at the lowest cost to taxpayers. There may be occasional situations where it is more cost-effective to hire consultants on specific projects than to have them employed full-time. In these circumstances we would expect robust guidelines to be in place; that they be rigorously followed and compliance monitored; and that appropriate sanctions would be deployed against individuals who broke them.

In the context of budget reductions of around eight per cent over the next four years, and the loss of 42,000 posts, we would expect the MoD to be doing everything possible to maximise the value taxpayers' get for their money, rather than relying on union reps to highlight gaping holes in their financial procedures.

 It is disingenuous for the MoD to be claiming to be cutting costs by reducing staff if external consultants are then bought in to do their job instead at a higher cost. They should be taking a more holistic approach to the costs of their projects which are already, in many cases, heavily over-budget.

Our Chief Executive, Matthew Elliot, had this to say:

“It’s appalling that the MoD has been managing its budget so catastrophically badly. This level of spending on consultants is disgraceful and worse still is the face that correct procedures were allowed to be so consistently ignored. Some larger or more technical projects may require consultants to be brought in for their specialist expertise, but this should be in moderation and should certainly be within the department’s own guidelines. Transparency and value for taxpayers’ money should to be at the heart of all Whitehall spending decisions, rather than the poorly planned, wasteful overspend that is plaguing huge swathes of the public sector. “


When questioned by the BBC the Defence Secretary, Philip Hammond, claimed claimed that tighter controls and a new framework now in place will ensure these costs are properly scrutinised in future. He compared reforming the MoD to manoeuvring an oil tanker and suggests that the "legacy of mismanagement is deep and will take some time to turn around."

Without fixing problems like this that ship will soon be heading into a storm.

Latest Blogs:

TaxPayers' Alliance Icon

The sugar tax and the public finances

6:00 AM 05, Dec 2016 Harry Fairhead

TaxPayers' Alliance Icon

Working for the taxman

6:00 AM 26, Nov 2016 Harry Fairhead

TaxPayers' Alliance Icon

Further thoughts on the Autumn Statement

4:56 PM 24, Nov 2016 James Price

TaxPayers' Alliance Icon

Have we had too much austerity?

10:57 AM 23, Nov 2016 Alex Wild