Issue - meetings

(a)       That the Committee is assured by the explanations given over the purpose of using consultants, the control of total cost and how value for money is obtained from current Council commissioning and contract management practice;

(b)       That the officers provide the Committee with details of the expenditure between the £2.831m coded as consultancy spend in 2014/15 and the £0.433m figure from the procurement classification; and 

(c)        That an analysis of the expenditure on consultants, to provide assurance on Value for Money, be submitted to the June meeting of the Committee and thereafter on an annual basis. 

The Chief Executive introduced a report to explain Council practice in the use of consultants and how value for money was obtained from commissioned consultancies. 

                        The Chief Executive asked that the Committee review his report objectively and keep the issues in proportion.  The report from the Audit Committee on 27 January 2016 was attached as an appendix; at that meeting it had been agreed that an update report on controls would be submitted to the July Audit Committee meeting.  He commented on the use of consultants in the public sector for areas where specific expertise was not already available within those organisations, and gave details of the definition of a consultant compared with an agency worker or interim manager. 

It was acknowledged that the issue of financial coding had been a concern and it was difficult to correctly ascertain the cost of properly defined consultants for previous years.  The report to Audit Committee had reported a cumulative expenditure of £2.831m coded as consultancy spend in 2014/15.  The report had also identified figures shown as consultancy under the procurement classification codes for business and management consultancy and project management services to only be £0.433m for 2014/15; the four known consultants over £25,000 contract value were detailed.  The table in the report showed a current total of £431,906 for consultancy costs for 2015/16 along with details of the projects that the consultants were working on. The Chief Executive explained that all of these appointments were supported by written business cases. 

The previously used definitions of consultants had been too general in their wording, leading to a range of expenditure, which should not have been recognised as consultancy, being allocated to the consultancy codes in the general ledger.  A list of expenditure that had been incorrectly coded to consultancy codes in recent years was reported in paragraph 2.02.  New controls had been put in place where Chief Officers could approve agency spend up to £25,000 but approval of a business case for any new consultancy work of a value of £25,000 or more would need to be given by the Chief Executive. 

The Corporate Finance Manager had been invited to make a formal statement on cost control in his capacity as Section 151 Officer and this was reported in paragraph 2.04. 

The two types of consultancy used were ‘fee based’ or ‘risk and reward’ and details of ‘live’ consultancies within Streetscene & Transportation, Social Services and Corporate Services were reported.  The Chief Executive explained that consultancies were funded from one of three areas which were (i) core budget, (ii) through ‘invest to save’ options or (iii) through Welsh Government/other grant funding.  There was strong evidence that skills and knowledge had been transferred from the consultants to the Council to make the organisation more self-sufficient for the future and examples of this were detailed in the report.  The Council was not too over-reliant on consultants.  He explained that whether ‘value for money’ was obtained from a consultant was a judgement best made by  ...  view the full minutes text for item 90