New data has shown that residents of the Australian state of Victoria have to pay nearly $1 billion (US$670 million) in consulting fees since the Labor government came into power in 2014.
On March 23, the Community and Public Sector Union (CPSU) released data on how much the Victorian Labor government has paid consulting agencies over the years.
According to the reports seen by The Epoch Times, $176.89 million was spent on consultancies in the 2021-2022 financial year, up from $66.93 million in 2019-2020 and $150.18 million in 2020-2021.
When put together, the total spending for the past eight years amounted to $896.38 million.
In 2021-2022, KPMG was the highest-paid agency, raking in $31.9 million via 59 engagements, followed by PwC at $15.3 million, Ernst and Young at $13.8 million, and Deloitte at $12.5 million.
Among the ten government agencies using consulting services, the Department of Transport had the highest spending at $37.74 million, while the Department of Premier and Cabinet recorded the lowest expenditure at $4.01 million.
CPSU federal secretary Karen Batt criticised the Victorian government for its hiring practices, saying the consulting agencies were a “secret government workforce” that came at a premium price.
“Close to a billion dollars has gone to consultancy agencies over eight years of Labor in government. This consultancy spending is obscene while the [public] service faces job cuts,” she said in comments obtained by The Epoch Times.
“The government continues to make hollow commitments to prune their consultant spend but never deliver while their workforce cops a wage cap and excessive work demands because there’s simply not enough staff.”
The secretary also said the Victorian government was addicted to contracting consulting agencies and that it would be smarter, safer and much cheaper to build in-house capabilities.
Victorian Premier Defends the Use of Consulting Agencies
Following the data’s release, Victorian Premier Daniel Andrews hit back at the CPSU, saying they should not criticise the government’s spending while complaining about increasing workloads in the public sector.“You kind of can’t have it both ways ... if you’re the CPSU complaining about too many consultancies and then complaining if you have to do more work,” Andrews told reporters.
“Let’s be clear. We have added the number of people that we need with the expertise that is critically important.
“I’m not here to have a quarrel with that union or anyone really, but you’ve got to be consistent.”
In addition, the premier refuted the idea that there was a brain drain within the state’s public service and said that many consulting contracts signed by the government were for the short term.
“Sometimes you need specialist skills, and you wouldn’t go and build your own team and have it there,” he said.
Regarding the upcoming May state budget, Andrews did not reveal how much the government had saved by reducing consultancy costs.
“The budget is not the budget that was delivered five years ago,” he said.
“But we will deliver all of our election commitments.
Response from Other Political Parties
Shadow Special Minister of State David Davis criticised the Labor government for its spending, saying that public service did well in 2014-2015 despite consulting expenditures being roughly a third compared to last year.“The government is scooping money out of the community and spending it like a drunken sailor on consultancies,” he said in comments obtained by AAP.
Meanwhile, the Greens urged the Labor government to halve consultancy spending and redirect the money into public service.
“With more and more Victorians being pushed to the margins, the government must put people struggling with the cost-of-living crisis before corporate profits,” the Greens’ economic justice spokesman Sam Hibbins said.
