Cabinet secretary Sir Gus O’Donnell defended central government’s spending on consultants to the public accounts select committee yesterday.

Speaking at a hearing on whether spending on consultancy delivers value for money, O'Donnell said the spending is only four per cent of that spent on goods and services. In the private sector this figure equates to “about 15 per cent”, he said.

The cabinet secretary also said that it was difficult for government to measure the outputs from spending on consultancy. He said: “Look, if you could tell me how to value the outputs that would be fantastic, I absolutely have no idea how you measure accurately the extra input. If you allow me to do two projects with consultants, one with, one without I could measure the output, but nobody would allow me to do that.”

O’Donnell said that increases in spending had occurred because government was doing more. He referenced the Home Office, which in recent years has had to work on big projects such as ID cards and the Eborders scheme.

He also said that senior leaders are working to develop specialist skills within the civil service, but that it will take time to yield the investment in training. “We set up a fast-stream for finance ... we've got various IT and business [training schemes] … we've got procurement specialisms, we've got commercial specialisms, we're starting to do all of these things,” he said, adding that the problem is that the civil service will have to wait for these skills "to come through".

The cabinet secretary appeared with the chief operating officer of the Efficiency and Reform Group in the Cabinet Office, Ian Watmore, who was challenged by Conservative MP Jo Johnson on whether government spending on consultancy had been shifted into "untransparent" arm’s length bodies.

Watmore responded: “If your concern is that we have moved one block of cost of consultancy spending out of central government and moved it somewhere else, I am 90 per cent confident that certainly the answer is no.”

Written by CSW