HL Deb 08 July 2004 vol 663 cc914-5

11. 14 a.m.

Lord Smith of Clifton

asked Her Majesty's Government:

Why the cost of external consultants to the Northern Ireland Office has risen from £10 million to £18.6 million between 1998–99 and 2002–03; and whether this represents value for money.

The Lord President of the Council (Baroness Amos)

My Lords, the figures quoted in the Question were presented in a recent Northern Ireland Audit Office report. That report acknowledged that consultants bring short-term expertise when it would be poor value for money to recruit and retain staff for discrete pieces of work. The increases referred to occurred as a result of devolution and the associated increase in work requirements, together with the introduction of new initiatives, such as resource accounting.

Lord Smith of Clifton

My Lords, I thank the Lord President for her reply, as far as it goes. This rise is of at least 80 per cent in a five-year period. I say "at least" because the report notes that there has been severe underreporting in certain areas, so it is not a comprehensive report. Does the noble Baroness agree with me that it is a damning report, in so far as the NIAO offers strong criticism of poor procurement, sloppy procedures, failure to follow DFP guidelines and little evaluation of results? As a benchmark, what was the corresponding figure for the use of consultants by government in England and Wales over the same five-year period, 1998–99 to 2002–03?

Baroness Amos

My Lords, the report identifies areas that need improvement and action has now been taken to address those areas. With respect to a comparison with England and Wales, there are no official data to hand but survey evidence suggests that expenditure on consultancy by the public sector in England has risen significantly. A survey done in April 2004 by the Management Consultancies Association highlighted how expenditure by public sector bodies had almost doubled in the year to 2003 to a figure of £1.3 billion.

Lord Glentoran

My Lords, I have with me a collection of documents that I picked up off my desk just now. They all arrived in the past month or so. They are all consultations of one sort or another. Is this a satisfactory and efficient way of carrying on the democratic process? What are the print runs of such documents and what percentage of them are read or, in particular, responded to by anyone?

Baroness Amos

My Lords, there have been many discussions in this House about the importance of consulting on policy questions and I think we all agree about that. I shall have to write to the noble Lord on the specific question of print runs.

Lord Dubs

My Lords, does my noble friend agree that at least part of the reason for the increase in consultants' fees in the period was the restructuring of Northern Ireland government departments from six to 10 because of devolution? It was essentially a one-off expenditure so that one would expect consultants not to have to be used further for those purposes.

Baroness Amos

My Lords, my noble friend is quite right. Some of the increase is related to restructuring. It is also related to the move to resource accounting and to devolution. It is important that we recognise that it would be poor value for money for departments to recruit and retain highly specialised staff whose contribution is not necessarily needed on a permanent or on-going basis. I cannot say that it is one-off expenditure but we need to make sure that we are giving value for money.

Lord Shutt of Greetland

My Lords, does the Minister agree with me that this is a very incomplete report on the use of consultants? If one tries to piece together some of the evidence one cannot actually get to the actual expenditure on consultants. In 2001–02, it was certainly in excess of £34 million, which is more than £20 per man, woman and child in Northern Ireland, but the worst element of all in this is that in 88 out of 100 cases studied in this report there has been no proper evaluation about whether there was any benefit in these consultants being hired.

Baroness Amos

My Lords, as I said in relation to an earlier question, the report identifies deficiencies, and those have now been addressed.

Lord Laird

My Lords, does the figure include the cost of image consultants? If so, what was the conclusion on those image consultants employed through the activities of the North/South Ministerial Council's recent discussions with loyalist and republican paramilitary groups? How do we assess value for money for image consultants for paramilitary groups?

Baroness Amos

My Lords, I have no idea whether the report includes the cost of image consultants, but I will find out and write to the noble Lord.

Lord Elton

My Lords, what were the deficiencies that the Minister says have been remedied?

Baroness Amos

My Lords, there were concerns about inconsistencies in the definition of "consultant" and about some of the monitoring mechanisms put in place. Guidance has been tightened and sent to departments.

Baroness Carnegy of Lour

My Lords, are the Northern Ireland consultants engaged by competitive tender? That is a very good way to make sure that one gets value for money.

Baroness Amos

My Lords, depending on their size, contracts are put out to competitive tender. If I can give the noble Baroness any further information on that, I shall write to her.