Chisholm pledges to curb use of consultants with plan to bolster in-house skills

Lord Agnew "makes a really good point" about the need to increase specialist skills in the civil service and rely less on consultants, COO says
Alex Chisholm spoke to MPs yesterday about civil service skills. Photo: Photoshot for CSW

Civil service chief operating officer Alex Chisholm has pledged to boost the expertise of civil servants to drive down the use of consultants across government, which he admitted was currently at “peak use”.

Appearing before the Public Accounts Committee yesterday, Chisholm said he recognised recent criticism of government’s reliance on consultants over recent months.

He said he expected to see a decrease in the use of management consultants, which departments have been using heavily to support Brexit transition preparations and the Covid-19 response, in the next few months as the end of the transition period approaches.

His comments came after months of headlines about departments’ use of external companies to provide capacity and skills in areas including the NHS test and trace programme, the Joint Biosecurity Centre and other areas of the coronavirus response – after bringing in large numbers of consultants to support Brexit preparations.

Chisholm was not able to put a figure on last year’s spending on management consultants, but said it was likely to be notably higher than the previous year’s total of around £980m.

A significant portion of the support for coronavirus-related projects has been procured through a rapid process that circumvents the usual procurement processes – which Chisholm acknowledged happened “without the full rigours of competitive tendering”.

“Clearly, we would like to restore the situation where all procurement of consultants go through proper competitive tenders,” he said. Asked if there were checks and balances in place, he replied: “We do have checks and balances but are they sufficient? That’s something we are actively considering at the moment.”

‘Armies of consultants betray a lack of in-house skills’

Asked by Sir Bernard Jenkin – the former chair of the Public Administration and Constitutional Affairs Committee – if he felt that using “armies of consultants” advertised a lack of skills in the civil service, Chisholm said he agreed “with the sentiment of the comment”.

He said the civil service should make “sparing” use of consultants, where it is justified to provide skills that are not available in house or where extra short-term capacity is needed.

He said a drive in the last few years to introduce more specialist skills – and thus reduce the government’s reliance on consultants – has been successful, but that further progress was needed.

He pointed to a “recent effort to try and further control that spending, which I fully support” by Lord Agnew, the Cabinet Office minister with responsibility for civil service transformation, who has been particularly critical on the matter.

Agnew has said it is "unacceptable" that bringing in external companies to consult on projects is "depriving our brightest people of opportunities to work on some of the most challenging, fulfilling and crunchy issues".

Asked if he agreed with Agnew’s assessment that the use of consultants “infantilises” the civil service, Chisholm said: “I think he makes a really good point, which is that we’ve got very, very talented people in the civil service who want to be developing their skills, have great skills. There’s no lack of talent or of people who want to work in the civil service."

He added: “What is really important to us… is adding to the skills of those people, enabling them to develop their professional aptitude. In that sense, I 100% agree with Lord Agnew that we should be doing more in house, and that capabilities that used to be seen as things you would get external consultants to do... should now be regarded as core disciplines in the civil service.”

This is particularly the case in four areas, Chisholm said: science, commercial, project management, and digital, data and technology.

He said a capability review by the government science and engineering profession had last year identified a need to develop the profession further.

And while there have been “great strides” in developing commercial skills in recent years, he said “the demand for commercial input and the scale of procurement that we’ve had to undertake has put further stress” on government’s existing capacity in this area.

In addition, government has fewer people than it would like who are “really super expert” in managing the multi-year, multi-billion-pound projects, he said. 

In focus: digital, data and technology

Digital, data and technology is an “area of great improvement, but one where the external market is obviously incredibly strong as well”, Chisholm said.

He said the function now makes less use of consultants than a decade ago, when it was “probably 50% dependent” on consultants and contractors.

“Three years ago that was down to about 40%, last year 30%, this year as far as we can tell down to 20%. So the effort to try and build up skills and capabilities within the civil service – in some cases requiring some changes to pay, but also to training and to the way in which we recruit people – has been successful and obviously we’d like to do more of that,” he said.

In focus: project delivery

Appearing alongside Chisholm to answer MPs’ questions, civil service chief people officer Rupert McNeil said there were a wide range of roles that needed to be bolstered if the government is to improve its performance on delivery major projects.

“We have to address that whole spectrum, which the project delivery profession has done. Both project delivery and commercial I think are pathfinders for us in that way,” he said.

He praised the project delivery profession framework for improving understanding of where skills gaps are.

He said there was a need to improve underlying skills that are critical to delivering projects, including automation and data analysis, and to ensure senior responsible owners of projects stay in post longer.

Adding to McNeil’s comments, Chisholm said troubled programmes often have a succession of leaders – and that he wanted people to see projects they were seeing through. “There is more use we could make of pivotal role allowance,” he said, referring to top-up payments used to encourage civil servants in positions of responsibility to stay in post.

He said relevant skills “really are at a premium; our view is that we should be prepared to pay that premium rather than have those projects poorly managed”.

Asked by Dame Cheryl Gillan whether the allowance was a “fancy term for ‘golden handcuffs’”, he quipped: “It’s the public service I wouldn’t want you to get carried away, Dame Cheryl, with the ‘golden’.”

Chisholm also said government was spending “a lot of money” on scoping and defining the terms of projects before they began, which he called the “gating” process.

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