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Plundering the Public Sector: How New Labour are Letting Consultants Run Off with £70 Billion of our Money

BMJ 2006; 333 doi: http://dx.doi.org/10.1136/bmj.333.7561.266 (Published 27 July 2006) Cite this as: BMJ 2006;333:266

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  1. Alex Paton (PatonAlex{at}aol.com), retired consultant physician, Oxfordshire

    Waste and inefficiency in the NHS is into lerable. A penny wasted is a penny stolen from a patient.” Thus Patricia Hewitt, the present health secretary and former board member of Andersen Consulting, trying to dig herself out of the financial mess that is the NHS. Ironically, according to Plundering the Public Sector, it is largely because of the billions of pounds wasted by new Labour on management consultants and information technology that the NHS is near bankrupt. The authors, David Craig, 20 years in management, and Richard Brooks, former tax inspector, provide a gripping and almost unbelievable account of the way taxpayers are being ripped off.



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    David Craig, Richard Brooks

    Constable, £9.99, pp 264 ISBN 1 84529 374 6

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    New Labour decided that the way to modernise the public sector—health, schools, police, defence—was to replace cautious civil servants with trendy management consultants and large scale information technology. Legions of consultants, earning anything from £1000-2500 (€1467-3670; $1853-4632) a week plus perks, were hired from a number of major firms that already had cosy relationships with the government. At the last count 32 consultants were heading government departments and running Cabinet teams, their cost estimated at £20bn a year, and of course a “revolving door” allows former ministers and MPs to join the gravy train. Craig and Brooks write: “This pattern of surreptitiously giving vast sums to consultants, trying to disguise how much has been paid [commercial confidentiality] and attempting to paint the episode as a stunning triumph of managerial excellence is a recurring feature of most of new Labour's failed projects.” Huge amounts of taxpayers' money disappear with virtually no checks on spending, no mechanism for ensuring value, and few legal penalties or fines for late delivery or cost overruns, which are almost universal.

    The information technology scene is equally depressing. Attempts to computerise the public sector have resulted in a string of spectacular and expensive disasters: Customs and Excise, Child Support Agency, Inland Revenue tax credits, National Air Traffic Control, and passports among them. The firms responsible seldom suffer since the government pays the overspend, and even awards them new contracts. The most ambitious project of all, NHS IT, trendily named Connecting for Health, costed at £6.5bn and directed by Richard Granger (ex Deloitte), is running two years late and the price has been upped to £20bn; it may eventually reach £50bn (the total NHS budget is £70bn). Its showcase project, “Choose and Book,” has been a dismal failure, largely, the authors say, because new Labour's mantra of “choice” suits a miniscule number of the 23 million hospital admissions a year. It is already being dubbed the electronic Millennium Dome.

    A long list of radical solutions is provided in a final chapter, but a government committed to spin, lies, secrecy, and “running the country by newspaper headlines” is unlikely to have the courage to admit its mistakes—let alone reverse them. Those who voted Labour in 1997 will endorse the authors' conclusion that new Labour's support for management consultants over the interests of taxpayers is “after the Iraq War the greatest betrayal of the electorate that once had such high hopes of the Blair and Brown administration.”