$1 Billion Spent on Secret Consultancies Equates to over 12,000 Jobs

New analysis from the Australia Institute shows that over $1 billion is spent by the Federal Government every year on consultancies, which often do not release the results of their work to the public; these funds could have created an additional 12,000 jobs in the public sector.

Key Findings:

  • The Federal Government spends over $1 billion a year on consultancies, but often does not release the results of this work.
  • The money spent each year on consultancies by the Federal Government could hire 12,000 additional public servants.
  • The Australia Institute recommends the Senate use an Order for the Production of Documents to require consultants reports written for the Government to be tabled in Parliament and be made public. This would make transparent to the public the advice received by government by private consultancies at taxpayer expense.
    • There are currently 18 such orders for the production of documents which have continuing effect, of particular note is the ‘Harradine Order’ which requires all federal Australian government department and agencies to produce an indexed list of files every six months for tabling before Parliament. This order assists with Freedom of Information requests, and helps make the operation of Government more transparent.
  • An example of  such a consultant’s report which has been kept secret is the Boston Consulting Group report into Australia Post which has been the focus of debate around Christine Holgate’s testimony to the Senate. An earlier 2014 Boston Consulting Group report into Australia Post was the subject of public analysis and criticism, however, this was only possible because that report was made public.

“It is worth reflecting on the rise of consultancy spending by the Federal Government, now exceeding $1 billion dollars a year. Compelling the work done by consultancies to be public would be an improvement on the status quo, although there is still the underlying issue that consultancies are doing an unprecedented amount of public work,” said Bill Browne, senior researcher at the Australia Institute’s Democracy & Accountability Program.

“In fact, the $1.1 billion spent on the largest consultancies last year could have employed an additional 12,346 public servants. It is not just jobs being lost to the public sector; knowledge and experience is being outsourced too.

“Our proposal of a continuing order in the Senate for the production of consultancy reports and written advice would go a long way to ensuring that the work being carried out at considerable taxpayer expense is available for the scrutiny of the public. While such an order would not resolve all problems with the spiralling reliance on consultancies, it would serve as a significant first step.”

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