Consulting firms to lose out on £3bn of government contracts
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UK government consulting spending faces major cuts as both main political parties have pledged to halve external advisory costs, potentially saving £3 billion over five years.
This move follows record-high spending since the last election, driven by pandemic response, digital projects, and civil service training.
According to Tussell data group, the Big Four firms, and four other consulting firms – McKinsey, BCG, Bain and Accenture – have collectively received £7.1bn of public sector contracts from December 2019.
Critics argue this reliance on consulting firms such as wastes money and hinders in-house skill development. While Labour estimates £3.73 billion savings over five years, the Cabinet Office forecasts £3.04bn. The Conservatives also aim to cut spending and reduce civil service size, the Financial Times reports.
Despite the high contract values awarded to firms like Deloitte (£1.9bn), actual spending is usually lower. The consulting industry defends its role, claiming it’s more cost-effective to use external firms for short-term projects than employing full-time specialists.