Peterborough City Council cuts spending on consultants during Covid crisis

Members of the Audit Committee were told at their online meeting this week that the total spend for the first six months of 2020/21 was just £0.9m, compared to £4.5m for the financial year 2019/20.

Peter Carpenter, Acting Corporate Director Resources, told the meeting: “The purpose of the report is to give members the latest update figures on the use of external consultants and agency staff by the council with the spend for the period April 2020-September 2020 is £952,940.22.

“The projected full spend for the financial year 2020/21 should be £1.8m which is about £1m lower than the average over the past few years.

“For comparison, I’ve included a 10-year overview of spending: in 2009/10 – £8.5m was spent; in 2010/11 – £6.4m; in 2011/12 – £5.4m; in 2012/13 – £4.3m; in 2013/14 – £4.5m; in 2014/15 – £3.1m; in 2015/16 – £2.5m; in 2016/17 – £3m; in 2017/18 – £2.4m; in 2018/19 – £2.7m; and in 2019/20 – £4.5m was spent.

“Agency staff spend for the same six-month period is £1.7m which projects up to £3.4m for the full year, which compares to the last few years and the average for the couple of years where we’ve spent £6m – so again, a significant decrease.

“We have been very successful of late in converting temporary staff posts to permanent positions, and our overall agency percentage is around 11-12%; that compares to national averages at the moment – in social care particularly – of around 23-24%.”

Cllr Andy Coles asked: “Is it the case that we’re transferring temporary positions to permanent positions in our social-care services?”

Mr Carpenter replied: “Yes we are, and in so doing we’re making an average saving of roughly £20k per social worker for each one we convert temporarily to a permanent job.

“We’re also in discussions with other agency firms obviously in terms of looking at agency contracts, and it’s quite apparent that we’ve managed to reduce our agency spend when other local authorities haven’t.

“There are many underlying factors in this, one of which will be Covid-19 where people are more comfortable working with social care staff who are permanent, rather than from a temporary agency.”

Cllr Aasiyah Joseph asked: “What do you project will be our agency savings in 2021/22, bearing in mind the savings we’ve made in 2020/21 are partly due to C-19 and have the remaining savings been achieved through redundancies and staff reductions?”

Mr Carpenter responded: “All local authorities have a certain amount of expenditure that will always be attributable to external consultancy, but I would expect 2021/22 expenditure to be somewhere in the region of £300-400k less than this year.

“With regard to savings directly attributable to Covid-19 compared with staff redundancies and staff reductions, I don’t have an exact figure at this time.

“However, the voluntary redundancy programme we had last year reduced staff by about thirty positions.”

Cllr Darren Fower asked: “This council has thrown tens of millions of pounds at consultants over the last ten years.

“But now, at a time when we are in an unprecedented period of our history – and one might suggest we need experts more than ever to help us out of a possible fiasco – why has this council reduced its spending significantly on ‘bods’ previously described by this administration, as ‘essential to efficiency’?”

Mr Carpenter said: “I think the simple answer to your question is that when it comes to delivering our services, we’re the experts; and the stuff that we’ve had to do for Covid-19 has shown us as a local authority to be expert in what we’ve done, with other local authorities learning from what we do.

“That could change in the future – as we know, consultancy firms are always very quick to pick up on what other people do; but even the Treasury has remarked on how well local government has done as a sector, delivering this.”

Cllr David Seaton added: “I was actually the person who suggested that we bring the consultants and agency staff report to every meeting of this committee.

“And while Cllr Fower suggests that we’ve ‘thrown tens of millions of pounds at consultants over the past ten years, I would remind members that every one of those pounds was approved by this committee – yet I can hardly recall a single occasion when there was a challenging voice to any part of that expenditure.

“If any member has an issue with money that we’re proposing to spend on consultants or agency staff, and why we’re engaging with them, then I would welcome them to come forward and let’s discuss the matter so we can be absolutely open and transparent about consults, and the services they’re providing.”

Members welcomed the report and looked forward to seeing the final six months figures at the end of the financial year.