DHSC spending £40,000 a week on consultants to develop business case for new health agency

PwC has helped draft business case for Treasury, hire staff and prepare for the Spending Review
Photo: PA

The Department of Health and Social Care is spending more than £40,000 a week on consultants to hire staff and help put together the business case for a new  health body being formed in response to the coronavirus pandemic.

The department has awarded PricewaterhouseCoopers £1.05m for six months’ work to help develop a “high-level financial business case” for the UK Health Security Agency’s first year, contract documents show.

Three PwC consultants have been working with the team setting up UKHSA since January, working to establish a finance project-management office function for the organisation. They will stay until mid-July, reviewing its approach to setting budgets, helping to prepare for the 2021 Spending Review and providing regular updates to DHSC, the Treasury, the Cabinet Office and No.10.

Under the £40,542-a-week contract, the consultants are also helping to manage the recruitment of permanent staff for the UKHSA – previously known as the National Institute for Health Protection – which came into being this month.

The body, which brings together NHS Test and Trace, the Joint Biosecurity Centre and some of the functions of the now-defunct Public Health England, is currently heavily reliant on temporary staff. Last month, CSW reported that DHSC had agreed to pay a search firm £962,830 to provide interim finance staff to the new body.

The contract was signed amid a government-wide drive to reduce spending on private consultancies. Two months earlier, civil service chief operating officer Alex Chisholm had said he wanted to boost in-house skills to drive down the use of consultants, after Cabinet Office minister Lord Agnew said the civil service was "infantilised" by its reliance on outside help.

It is the latest of several deals that show DHSC is leaning heavly on consultants to help set up UKHSA and run the test and trace programme despite the insistence of Baroness Dido Harding, who led the body before handing over to deputy chief medical officer Jenny Harries this month, that it would reduce its reliance on their input.

In February, Harding said “much of the build phase” for the NIHP was complete and that hiring of civil servants had been ramped up. However, she has defended its extensive use of consultants, saying it has been necessary to draw on "all the talents across all of society".

Under the latest deal, PwC consultants have been working on a draft of a formal business case document to be submitted to the Treasury, providing financial calculations and helping to work out which long-term functions and resources the new health body will need.

They have also helped the organisation manage the end of the 2020-21 financial year and ensure NHS Test and Trace delivered its priorities for the final quarter. Other “priority projects” they are working on include resolving “remuneration issues” among staff, and preparing for both internal audits and those by the National Audit Office.

Consultants are filling three roles at the UKHSA: a G6-level project-management office lead, a G7 PMO change-management support; and a senior executive officer-level finance assistant.

The PMO lead provides advice on the “more complex or strategic issues” and has the authority to manage and delegate workstreams to less-senior civil servants working on the transition, according to the documents.

PwC partners or directors are expected to oversee the team, review drafts of its work and provide financial advice.

A DHSC spokesperson said: “As part of our response to this global pandemic we have drawn on the expertise and resources of a number of public and private sector partners. 

“The UK Health Security Agency will work to protect the country from future health threats and ensure the nation can respond to pandemics quickly and at greater scale.

“Every pound spent is helping to save lives, but we have always been clear that all contracts must achieve value for taxpayers and are based on good commercial judgement.” 

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