71st Report - Government’s use of external consultants

Select Committee

Public Accounts Committee HC 1521 11 March 2026

Report Status Government responded

Conclusions & Recommendations 23 items (9 recs)

Source View on Parliament website

Government Response (AI assessment · 21 of 23 classified)

Accepted 15

Deferred 3

Government response

Treasury Minutes: Government response - 71st Report - Government’s use of external consultants

Read the government response ↗ Response on the tracker

Recommendations & Conclusions

15 results

2 Recommendation Accepted

The Cabinet Office is unable to deliver on its strategic objective to reduce consultancy spend...

Recommendation

The Cabinet Office is unable to deliver on its strategic objective to reduce consultancy spend because departments are not complying with its definitions and directives. The Chief Commercial Officer stated that some departments are not following Government Commercial Function guidance … Read more

Government Response Summary

The Cabinet Office has commissioned the Government Internal Audit Agency (GIAA) to carry out a review of 15 organisations with significant consultancy spending and will write to the Committee with GIAA’s findings and the steps the Cabinet Office will take as a result.

HM Treasury

3 Recommendation Accepted

The Cabinet Office is unable to demonstrate that the target to halve consultancy spend is...

Recommendation

The Cabinet Office is unable to demonstrate that the target to halve consultancy spend is an effective way to reduce spending on external providers. The Chancellor announced her intention to stop all non- essential spending on consultancy immediately and halve … Read more

Government Response Summary

The Cabinet Office has commissioned departments on their spending on professional services published for 2022-23, 2023-24, and 2024-25 and will provide collated data to the Committee by July 2026.

HM Treasury

4 Recommendation Accepted

The Cabinet Office has not provided departments with up-to-date guidance on how to procure, learn...

Recommendation

The Cabinet Office has not provided departments with up-to-date guidance on how to procure, learn from and manage consultancy. The Government Commercial Function (GCF) is responsible for the Consultancy Playbook, as well as the related Sourcing Playbook. The Consultancy Playbook … Read more

Government Response Summary

The Cabinet Office will publish the updated Consultancy Playbook by July 2026, and it will incorporate updated guidance about the use of emerging technologies such as artificial intelligence.

HM Treasury

6 Recommendation Accepted

We questioned whether government has a breakdown of the amount spent on consultancy services in...

Recommendation

We questioned whether government has a breakdown of the amount spent on consultancy services in government with individual consultancy firms, separating audit fees from consultancy work. The Chief Commercial Officer explained they have the total annual spend, broken down by … Read more

Government Response Summary

The government agrees to provide a breakdown of consultancy spending, commissioning departments to report data on their top ten suppliers across consultancy, contingent labour, and professional services, including all spending with those suppliers in other categories, with a target implementation by Summer 2026.

HM Treasury

7 Conclusion Accepted

We asked about the current processes for improving data quality and reducing labour intensive data...

Conclusion

We asked about the current processes for improving data quality and reducing labour intensive data checking processes. The Cabinet Office acknowledged that data processes are not yet as good as they need to be, but that it is investing in … Read more

Government Response Summary

The government agrees, setting a target implementation date of Summer 2026. The Cabinet Office has commissioned departments to report spending data on their top ten suppliers across specific categories to enhance data quality and transparency.

HM Treasury

8 Conclusion Accepted

Inconsistent data prevent departments from understanding which consultants they use, or what skills gaps they...

Conclusion

Inconsistent data prevent departments from understanding which consultants they use, or what skills gaps they repeatedly hire consultants to address. Departmental annual reports use different definitions of what constitutes consultancy spending, which may or may not be based on the … Read more

Government Response Summary

The government agrees to address inconsistent data by commissioning departments to report spending data on top ten suppliers across three categories by Summer 2026, and by commissioning the GIAA to review 15 organisations for adherence to consultancy spending definitions and controls by Autumn 2026, with findings to be reported to the Committee.

HM Treasury

9 Conclusion Accepted

We asked the Department why there is no uniform definition for consultancy used across government.

Conclusion

We asked the Department why there is no uniform definition for consultancy used across government. The Chief Commercial Officer explained there is a standard definition for consultants across government, which is published in the Consultancy Playbook, and that the differences … Read more

Government Response Summary

The government agrees with the committee's findings and has commissioned departments to provide detailed spending data across consultancy, contingent labour, and professional services, and has engaged the GIAA to review 15 organisations for adherence to consultancy definitions and controls by Autumn 2026.

HM Treasury

10 Recommendation Accepted

The Department said it plans to ensure compliance by departments with standard definitions through a...

Recommendation

The Department said it plans to ensure compliance by departments with standard definitions through a combination of audit, data and technology improvements, and strengthening its mandate. The Cabinet Office has also established a working group and is seeking advice from … Read more

Government Response Summary

The government agrees to ensure departmental compliance with standard definitions by commissioning the Government Internal Audit Agency (GIAA) to review 15 organisations for adherence to consultancy spending definitions and implementation of controls, with findings to be reported to the Committee by Autumn 2026.

HM Treasury

11 Conclusion Accepted

The Chancellor’s July 2024 speech set targets to cut consultancy spending, including an immediate halt...

Conclusion

The Chancellor’s July 2024 speech set targets to cut consultancy spending, including an immediate halt to non-essential services and halving future spend to save £550 million in 2024–25. These goals were reiterated in the 2024 Autumn Budget. Cabinet Office and … Read more

Government Response Summary

The government acknowledges the committee's finding regarding spending targets and monitoring, stating that departments already publish consultancy and contingent labour spending, and the Cabinet Office will provide collated professional services spending data to the Committee by July 2026.

HM Treasury

12 Conclusion Accepted

The Cabinet Office told us that central spending controls over consultancy spending were withdrawn in...

Conclusion

The Cabinet Office told us that central spending controls over consultancy spending were withdrawn in 2023 to improve the pace of decision-making in government.27 It has since encouraged departments to develop their own internal controls.28 When asked how government ensures … Read more

Government Response Summary

The government agrees with the committee's findings and has commissioned the GIAA to review 15 organisations to assess their adherence to consultancy spending definitions and the implementation of appropriate controls, with findings to be shared with the committee by Autumn 2026.

HM Treasury

13 Conclusion Accepted

The Cabinet Office told us that government is checking and validating the data it receives...

Conclusion

The Cabinet Office told us that government is checking and validating the data it receives from departments. This includes HM Treasury working with departments to ensure the data reflects actual consultancy spend.31 The Cabinet Office stated that the data indicates … Read more

Government Response Summary

The government acknowledges the committee's findings and has commissioned departments to report spending data for their top ten suppliers across consultancy, contingent labour, and professional services, to ensure comprehensive and useful data collection by Summer 2026.

HM Treasury

14 Conclusion Accepted

We asked what assurance the Cabinet Office and HM Treasury can give taxpayers that any...

Conclusion

We asked what assurance the Cabinet Office and HM Treasury can give taxpayers that any savings will reflect actual reductions in spend, rather than shifting spend to other categories, such as contingent labour. The Cabinet Office explained that it is … Read more

Government Response Summary

The government acknowledges the committee's finding regarding assurance against spending shifts, confirming that departments publish spending on consultancy and contingent labour, and the Cabinet Office will provide collated professional services spending data to the Committee by July 2026.

HM Treasury

15 Conclusion Accepted

In May 2021, the government established the Government Consulting Hub (GCH) to improve its use...

Conclusion

In May 2021, the government established the Government Consulting Hub (GCH) to improve its use of consultants and provide an in-house alternative. It employed around 70 to 100 staff and charged costs to departments using its services. The GCH published … Read more

Government Response Summary

The government acknowledges the committee's finding and states that the Cabinet Office is currently refreshing the Consultancy Playbook to include guidance on emerging technologies like AI, with publication expected by July 2026.

HM Treasury

16 Conclusion Accepted

The Cabinet Office told us that The Consultancy Playbook sets out lessons learned on getting...

Conclusion

The Cabinet Office told us that The Consultancy Playbook sets out lessons learned on getting the best value from consultancy, including knowledge transfer and sharing best practice across departments. This may particularly apply to innovative digital and technology projects where … Read more

Government Response Summary

The government acknowledges the committee's finding and confirms that the Cabinet Office is refreshing the Consultancy Playbook to include updated guidance on emerging technologies like AI, with an expected publication date of July 2026.

HM Treasury

17 Recommendation Accepted

However, the Playbook was last updated in 2022 and contains many references to the Government...

Recommendation

However, the Playbook was last updated in 2022 and contains many references to the Government Consulting Hub (GCH), including its Knowledge Exchange platform, despite this hub no longer existing. We asked why the Consultancy Playbook has not yet been reissued … Read more

Government Response Summary

The government agrees to update and reissue the Consultancy Playbook by July 2026, incorporating updated guidance on emerging technologies like AI, following consultation with departments and industry.

HM Treasury