Big four consultancy firms earn £50m from Scottish taxpayer funded contracts

More than £50 million has been spent on advice and consultants by the Scottish Government with just five companies in the past decade, it can be revealed.

In total, the so-called ‘big four’ consultancy firms of Deloitte, Ernst and Young, KPMG and PricewaterhouseCoopers (PwC) have received millions of pounds a year since the SNP won a majority in the 2011 Scottish election.

However, the true figure is likely much higher due to it only covering previous expenditure and omitting ongoing and recently signed contracts.

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For example, Teneo has an ongoing contract with the Scottish Government worth £400,000 for litigation support connected with the ongoing malicious prosecution case against the Lord Advocate linked to the Rangers administration.

The Scottish Government has spent more than £50m with large consultancy firms since 2011The Scottish Government has spent more than £50m with large consultancy firms since 2011
The Scottish Government has spent more than £50m with large consultancy firms since 2011

This contract is not included in the PR and consultancy giant’s final figure of income from the Scottish Government as disclosed to The Scotsman of just over £6,000.

The figures come amid renewed scrutiny on the Scottish Government’s contracts with large consultancy firms after millions of pounds of work connected to the establishment of the National Care Service were given to KPMG and PwC, leading to condemnation from trade unions.

Roz Foyer, the general secretary of the Scottish Trade Unions Congress (STUC), said the sums were “alarming”.

She said: “It’s alarming that such eye-watering sums of Scottish Government money routinely end up in the hands of corporate, unaccountable conglomerates rather than paying for the wages of our excellent civil service.

“These companies have a track record of supporting the privatisation and downsizing of public services. We cannot – and should not – have a situation where public money is so regularly paid to private organisations with vested interests to profit over people.”

By far the most lucrative relationship of any consultancy giant is that between Deloitte and the Scottish Government, worth £35.6m since 2012 inclusive.

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Deloitte’s income from the SNP Government has risen dramatically in recent years, growing from £500k in 2017 to £9.5m in 2021.

Ernst and Young, who undertook the due diligence work on the Scottish Government’s half-a-billion-pound deal with GFG Alliance to save the Lochaber smelter, has earned more than £7.5m in the past decade.

This includes around £3m in the past two years.

KPMG, which recently voluntarily withdrew from bidding for Scottish Government contracts amid its involvement in a number of scandals, has received almost £5m in ten years, while PwC have been paid more than £2m.

Scottish Conservative finance spokesperson Liz Smith said the figures were “absolutely astonishing”.

She said: “The public will rightly demand to know why the SNP is splashing out so much on consultancy firms.

“This is taxpayers’ money – it should not take Freedom of Information requests to find out the extent of the SNP Government’s financial dealings.

“With so many millions going to one firm in particular, SNP ministers must be fully upfront about the process behind these major contracts being signed.”

A Scottish Government spokesperson said: “The Scottish Government relies on expertise from many different sources. Consultancy contracts are awarded in compliance with procurement rules.

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"As well as management consultancy, the figures include, among other things, the delivery of digital work on major platforms.”

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