Nick Kempe – 20th January 2022
On 10th January the Scottish Government published a notice on the Scotland Contracts Portal announcing it had awarded a contract worth £546k to KPMG to help design a new National Care Service (NCS). This followed the award of a contract, worth £100k, to PWC on 6th October for preliminary work on the design of the NCS. In-between PWC was awarded a further contract, worth £90k, on 21st December to analyse the responses from the public to the Scottish Government’s consultation on the NCS. All these decisions have attracted some critical media publicity and have rightly been condemned by trade unions.
The Common Weal Care Reform Group believes the decision to outsource key parts of the design of what should be a public service, like the NHS, to the private sector is wrong in principle and does not bode well. What has happened, however, indicates the degree of rot at the heart of government in Scotland.
The Scottish Government’s relationship with KPMG and similar management consultancies is now very close. The £546k NCS contract is small beer compared to the £2.85m which a Freedom of Information request revealed the Scottish Government agreed to pay KPMG for Covid related work.
In the case of KPMG, Common Weal has also been reliably informed that members of their staff moved to jobs in the Scottish Government and vice versa. In other words, the issue is not just that the Scottish Government is outsourcing significant amounts of work to management consultancies, it’s that their thinking pervades how the Scottish Government is approaching the design National Care Service. This is illustrated by the procurement process and the tender documents which Common Weal obtained through a Freedom of Information request.
The tender was advertised through the Crown (i.e. UK wide) Commercial Services Management Consultancy Framework 3. This meant it was almost inevitable one of the Big Four (KPMG, Deloitte, PWC or EY) would win the tender and effectively excluded people and organisations in Scotland with considerable knowledge and experience of the care system (e.g. universities). It is unlikely that the Scottish Government would have contracted with EY and Deloitte after the revelations in Private Eye about their involvement in the PPE and Track and Trace procurement scandals down in England.
What is extraordinary, however, is that having chosen to use a UK wide framework, the Scottish Government has then chosen to ignore the threat from the UK Cabinet Office to ban KPMG “from winning public sector work after its involvement in a series of scandals” as reported in the Financial Times just before Xmas. As a result KPMG took “the unusual step of withdrawing from bidding for UK government contracts” but not, its seems, contracts with the Scottish Government. An indication of the extent to which KPMG is “in with the bricks” in Scotland.
The tender documents are full of management jargon, alien to social care and betraying the influence of management consultancies. Part of the work involves describing the “Current Operating Model”, both governance and finance, for social care. Why the Scottish Government doesn’t know this tells us something but that they are asking an external management consultancy to provide this information tells us even more. Either officials will be doing KPMG’s job for them or KPMG are so in with the bricks that they already have access to this information.
Alongside the “COM”, KPMG has been given the task of designing TOM or “Target Operating Model”: “The TOM should provide an outline for National Care Service functions and possible NCS local structure (pending consultation on reform of integration authorities). Alongside this, a wider map of interdependent agencies and functions is required to understand clearly how the future-state will operate, i.e. any transfer of functions, new requirements, etc.” Set aside the management speak and the Scottish Government appears to have no vision and real idea of what it wants. That might not matter if they had involved those who knew and cared about care involved in the design of the NCS but instead the Scottish Government has chosen to hand the work to the private sector.
What’s more, in handing over responsibility for the analysis of responses to the consultation to PWC, effectively the Scottish Government has handed all the ideas that people have had about how to improve the care system over to the private sector. The value of that to the private management consultancies that are slowly taking over government is priceless.
The key point that the Scottish Government has ignored is that these management consultancies have vested interests in breaking up the public sector in the form of more audit opportunities for the accountancy sides to their business while the more they break up the public sector the more opportunities there are consultancy work). They are also imbued with private sector ideology. There is no chance of KPMG, for example, coming up with a TOM that excludes the private care home sector when it is so involved in the development of markets in both health and social care.
The conflicts of interest should be obvious. Unfortunately, the procurement system in Scotland is so convoluted and unfit for purpose that the decision to award to design of the NCS in this way and to these management consultancies is almost certainly quite legal.