Government Outsources Responsibility for Outsourcing
The professional services giant Deloitte is being employed to help the Government to interpret and implement its own ‘Outsourcing Playbook’
Corporate monolith Deloitte is being paid to assist the Government’s implementation of its own private sector outsourcing policies, Byline Times can reveal.
Newly-released Government data shows that Deloitte, a British multinational consultancy firm, was paid a total of £804,608 in September and October for “outsourcing implementation”.
After contacting the Cabinet Office, Byline Times understands that Deloitte has been employed to help Government departments to implement its “Outsourcing Playbook”. This document, published in February 2019 and updated in June this year, explains the process that departments should take when outsourcing – or considering outsourcing – public sector work to private or third-sector firms.
The document contains sections on how departments should evaluate the ability of private firms to successfully carry out work, how opportunities should be advertised, and the competitive procedures that should accompany contracts.
The document is publicly available and can be scrutinised by any firm that may be seeking Government work. In that spirit, the Outsourcing Playbook notes that, transparency and accountability of public service delivery data and information builds trust and confidence in public services. It enables citizens to see how taxpayers’ money is being spent; and allows the performance of public services to be independently scrutinised”.
For its part, Deloitte is a multi-functional professional services giant with a turnover of $47.6 billion in 2020. In particular, the firm provides audit, business consultancy, tax and legal services – and has an extensive portfolio of Government projects.
OpenDemocracy has identified that Deloitte’s income from the public sector response to COVID-19 stands at more than £60 million. The company has been commissioned to help with the UK’s ‘Test and Trace’ operation, as well as to supply personal protective equipment (PPE). Byline Times understands that the firm has also been helping the Government to deal with issues relating to universities and schools.
Aside from COVID-19, the firm has recently been awarded a £30 million contract to help manage the end of the Brexit transition period – along with five other consultancy giants. The Government’s contracts dashboard suggests that the company has won at least 100 public sector contracts since 1 March this year – worth hundreds of millions – though other contracts may well have been awarded through pre-existing framework agreements. These frameworks awards do not have to be publicly announced.
It is understood that Deloitte helped departments to implement the original Outsourcing Playbook last February and has now been re-contracted, presumably as officials seek further assistance in navigating Government policies.
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While the outsourcing of Government work to the private sector is nothing new, it has burgeoned as an issue during the Coronavirus pandemic.
The Department of Health and Social Care (DHSC) alone has spent £12 billion on private sector contracts for the supply of PPE, and has budgeted a further £3 billion for this financial year. The DHSC spent a total of £1.1 billion on 174 outsourced contracts in 2019/20.
Due to the heightened demand fostered by the pandemic, the Government’s lack of foresight in stockpiling equipment, and its delayed response to a severe shortage of PPE, it is estimated that the DHSC has overspent by billions this year.
Consequently, the outsourcing trend has taken a battering on multiple fronts. Firstly, on democratic grounds – private sector firms are accountable to their owners and shareholders, not the public they have been contracted to serve. But also simply on the grounds of efficacy. It has been questioned what special elixir these firms possess, aside from their ability to successfully bid for contracts.
The Government’s Test and Trace system, for example, has relied heavily on the work of another outsourcing giant: Serco. This operation has been pilloried throughout the pandemic, with statistics suggesting that it is reaching too few people to be effective.
In an additional irony, Serco has been placed on a £7.5 billion Government contract agreement to supply services designed to help people to obtain and retain employment in the wake of the pandemic; a pandemic that has been more devastating – in terms of health and economic impacts – in the UK than anywhere else in Europe.
Serco says it is “proud” of its work on the Test and Trace programme, and will bid alongside 27 other suppliers to deliver post-COVID employment services.
Deloitte declined to comment and the Cabinet Office did not respond to Byline Times’ request for comment.