Peterborough City Council and Consultants Update – for research purposes only

The relationship between Peterborough City Council and consultants is becoming a cause for concern for some councillors. This is an update on events up until 16th March 2010.

Continued from Part One

1.1 This report has been prepared following a series of scrutiny meetings.
At a meeting of the Environment Capital Scrutiny Committee on 14th January 2010, to discuss the proposed council budget, the subject of use of consultants arose. The minutes of this meeting are attached at
Appendix 1.
It was agreed that the Sustainable Growth Scrutiny Committee be recommended to undertake an in-depth scrutiny review into the cost and effectiveness of the Council’s use of consultants and to make recommendations on the future use of consultants by the council to inform the development of budgets in future years.
Although not referred to in the minutes, the Executive Director – Strategic Resources, offered to meet with the Chair of the Sustainable Growth Scrutiny Committee to prepare the terms of reference for the review. That meeting did not take place and at its meeting held on 18th January 2010 the Sustainable Growth Scrutiny Committee produced a list of questions which it asked to be answered,
Quoted from this document: Use of Consultants – Scrutiny Review

The Questions:

Sustainable Growth Scrutiny Committee. Date of Issue: 18th January 2010
(Numbered for convenience)
Please provide answers into the use of and cost of all consultants employed or contracted to PCC over the past two years.

1. Identify all consultancy companies.
2. Identify any company which may be sub-contracting to the main consultancy company.
3. Are the employees of the sub-contracting company directors of that company.
4. Identify any other individuals who may be operating on a self-employed basis are are engaged by PCC.
5. Identify the service period of any and all individuals who may have been employed by PCC, on a consultancy basis, either directly or indirectly.
6. Clarify the actual reason for the engagement of all consultants and companies. The areas of work undertaken and the financial benfits derived from that employment.
7. Clarify the status of Amtec PLC in relation to V4 Ltd and method of remuneration.
8. Who actually makes the decision to engage a consultant and how is this decision actually authorised.
9. Who determines what rate is paid.
10. Exactly what rate is paid, plus any other fees which may be involved.
11. Provide documented evidence by way of a copy invoice as proof of all monthly payments.
12. Provide documented evidence of the actual yearly cost of all consultancy fees.
13. What action is being taken to reduce the reliance on consultants.
14. What recommendations, if any, were implemented following on from an enquiry held some five or six years ago into the sue of consultants.

Please provide a full and comprehensive response within four weeks of the above date sp that any queries can be clarified prior to the March 15th meeting.

Please ensure this item is placed on the March 15th agenda.

Cllr Mike Fletcher Chairman.

Quoted from this document:  Sustainable Growth Consultants Questions

The Response:

“The questions will just generate potentially hundreds of pages of paperwork, without any context, ability to question individuals, businesses or partners to give a complete picture of how consultancy is used in this Council.”

Quoted again from this document: Use of Consultants – Scrutiny Review

Interesting Questions and Answers from the 14th January ECSC meeting: (verbatim)

Sustainable Growth Scrutiny Committee
Observations and questions were asked around the following areas:

The budget papers showed the savings which had been made and were expected to be made by the Business Transformation Team. If they were doing such a good job why were we still required to keep increasing the level of Council Tax? Were the savings the Business Transformation programme making going on consultants?
The Business Transformation Programme had saved £24m. The need to raise Council Tax was due to a number of factors including the impact of the credit crunch and recession, leases of council properties and low interest rates which kept the investment income down. The use of consultants was good value for money and covered consultancy work and interim appointments. All consultants were procured properly.
We were currently paying around £8-9m per year on consultants, why did we not have the staff with the required the skills to undertake the work.
The last Freedom of Information request was around that figure. We often needed specialist expertise and it sometimes was best to employ people as and when they were needed. We di look to see if we could use the expertise of people internally.
It was clear that the Council was continuing to employ consultants at the same level even though we had been given a commitment that the Council was working hard to reduce its reliance on them. It seems that some consultants appeared to be employed on a permanent basis. Were there any records which showed the number of consultants employed for more than six months?
There was not a central database kept but within Strategic Resources no consultants were employed for five days a week.
The Deputy Chief Executive has been employed on an interim basis for a long time.
The salary of the Deputy Chief Executive had already been raised at a meeting of full Council and a written answer had been given. We looked to engage the best people at the most affordable rates for the benefit of the City.

If a consultant is used for a six month contract, are they paid for the full six months or only the days they work within that period?
They were paid on a daily rate. All of the Business Transformation programmes must have a business case approved including the value of any consultants, once agreed any variations had be approved by the Executive Director of Strategic Resources.
Why did the Council employ contractors on a long term basis?
It was common practice to employ consultants in areas such as engineering and architectural services, such as our contract with Atkins. Through the Business Transformation programme a business model has been introduced in the Council which is very effective and an exemplar to other authorities. This is shown in our good use of resources scores.
An in-depth inquiry should be held into the circumstances of the Deputy Chief Executive post as some members did not feel that the published figures were correct.
The arrangements for the Deputy Chief Executive post would be ending by 31 March 2010 and the Chief Executive was proposing that the post would be vacant for three years. If members wished to undertake an inquiry into the Council’s overall use of consultants then the Executive Director would put together clear terms of reference for the remit of any inquiry.


And finally from a BBC Radio Peterborough Interview with Cllr Mike Fletcher broadcast on March 1st at 07:10am. Interviewer Andy Gall.

AG: We’ve been told that the consultancy firm in question is threatening legal action, if the Council reveals what it’s being used for.
MF: Let me just tell you something. On Monday 22nd February, I received an email in the evening, and was going to have an Interim Meeting the next day, but it was received without any prior consultation whatsoever, which had been issued by the Solicitors to the Council.
AG: Right.
MF: And it states: “on the instructions of the Solicitors to the Council, the Informal Meeting of the Sustainable Growth Scrutiny Committee tomorrow is required to be cancelled” The reason being, the Council is being threatened with legal action, over the release of information, and she needs to fully consider what we propose to release, with the lawyers acting for the consultants concerned. She has requested ten working days to sort out this issue. I find that to be somewhat astounding.
AG: Hasn’t Marco Cereste come out and said there should be transparency? Well, certainly the MP for Peterborough has, hasn’t he? He said there should be some transparency.
MF: Of course there should. And I’m sure that Marco will get on top of it. I’ve every faith in Marco.


Continue to Part Three