Public sector advisers in dock

THE spread of commercial methods in the public sector has been a money-spinner for management consultants. According to the report published this month by the Cabinet Office Efficiency Unit, spending on external consultants totalled more than pounds 500m in 1992-93 alone.

Less certain, as the report points out, is the value of that work. It accepts that the advice given by consultants has been beneficial, but adds that only limited attempts have been made to assess how beneficial, and to convert that into a value-for-money equation.

Over four years, departments and agencies could identify only pounds 50m of savings from consultants. This is partly because it is difficult to obtain information about their role and track spending and savings consistently. Even when the outcome is quantifiable, there may be no ready way of apportioning consultants' contributions to a trunk road, for example.

Not surprisingly, consultants are somewhat defensive about the findings. Brian O'Rorke, executive director of the Management Consultancies Association, which represents the leading firms, welcomed the report while questioning some figures. Individual members also query whether savings can be achieved on the scale indicated.

Some question the practicality of establishing databases of individual advisers. Julian Bagwell, a partner with Touche Ross, said it would be too difficult to keep a database of firms and consultants up to date.

He recommends networking - via 'centres ofexcellence' - as an effective way for civil servants to ensure they get the right people for the job, as the standard of service is generally linked to the calibre of the individuals.

The report estimates that improvements of this nature, and impressing on civil servants the need to use consultants only on matters of real importance, could produce net savings of about pounds 40m a year. But research by a team at Templeton College, Oxford, suggests this may be optimistic.

Ian Kessler, who, with John Purcell, is carrying out a three- year study of employee relations in the public sector, says it is easy to understand why civil servants make such extensive use of external consultants, because managers have to take on greater responsibilities, often without knowing how to go about them. In the same way that companies can drift about looking for ideas, so can managers in government.

And, Mr Kessler says, 'When you search for solutions, it's not surprising that you go to the solution merchants, consultants.'