Credit: Dreamstime
NSW spent more than $1 billion on consultants over the last five years, with the world’s four biggest firms taking the lion's share of spending.
The global systems integrators of KPMG, Ernst & Young, PwC and Deloitte accounted for 27 per cent of the state’s consultancy spend since 2017.
The collective, known as the Big Four, was cited in the NSW Auditor-General's NSW government agencies' use of consultants report, which revealed that government agencies are unlikely to meet the 2019 policy commitment to reduce consultancy expenses by 20 per cent each year.
Broken down, the report revealed that NSW government agencies paid around $72 million to KPMG during the period between 2017 and 2022, making it the highest NSW earner.
Ernst & Young received $70 million during the same period, followed by PwC, with $57 million and Deloitte, which pocketed $42 million.
In total, the NSW government used 1,000 consulting firms over the five-year period, of which 30 per cent had contract variations that increased costs.
The audit report claimed the NSW government was lacking a single data source that accurately captures all spending on consultants despite recommendations in 2018 that NSW Procurement improves the quality of information collected from agencies and suppliers.
In early 2019, the NSW government made a policy commitment to reduce consultancy expenses by 20 per cent each year, over four years, from 2019–20.
However, actual spending on consultants recorded in the first three years after the commitment was made was almost $100 million higher than the targets.
“We did not see any evidence that the financial data on actual expenditure was used to inform reporting on NSW government agencies' progress toward achieving the savings set out in the policy commitment,” the auditor’s report said.
Last month, the Audit Office of NSW criticised Cyber Security NSW, claiming it “does not clearly and consistently communicate its key objectives” despite the agency receiving “enhanced funding” in 2020.
