This is the dawning of the Age of Consultancy
Before the election the Coalition announced a series of inquiries, reviews and white papers that it would instigate if it were elected. They included:
- Commission of Audit
- Inquiry into the Financial Sector
- Review of Competition Policy
- Judicial Inquiry – Home Insulation Programme
- Review of the Department of Defence
- Coal Seam Gas Management and Wind Farms
- Inquiries into the National Broadband Network – The Coalition will
conduct three inquiries as part of its “Plan for a Better NBN”. - Inquiry into the Australian Tax Office
Productivity Commission Inquiries and Reviews
- Inquiry into Child Care Funding
- Review of Industrial Relations
- Review of the Automotive Industry
White Papers
The Coalition will produce White Papers on the following:
- Tax Reform
- Direct Action Plan
- Federal-State Relations
- Defence
- Development of Northern Australia
- Resources and Energy
Since the election, that list has grown.
Sussan Ley was up and running, commissioning a report from
PriceWaterhouseCoopers into child care funding. Apparently she couldn’t
wait for the results from the inquiry that the Productivity Commission
was already conducting
Coincidentally, the North Sydney Forum,
a campaign fundraising body for Joe Hockey whose $22,000 annual
membership fee is rewarded with “VIP” meetings with Mr Hockey, was
established in 2009, shortly after Joe became shadow treasurer, by
Joseph Carrozzi, managing partner at professional services firm
PriceWaterhouseCoopers.
Mr Carrozzi is also chairman of the Italian Chamber of Commerce and
Industry in Australia and was a board member of the organisation when
Nick Di Girolamo was its chairman.
Members of the forum include National Australia Bank as well as the
influential Financial Services Council, whose chief executive is former
NSW Liberal leader John Brogden.
The FSC’s members, including financial advice and funds management
firms, stand to benefit from the changes to the Future of Financial
Advice (FOFA) laws. The National Australia Bank would also benefit from
the changes.
The chairman of the North Sydney Forum is John Hart, who is also the
chief executive of Restaurant and Catering Australia – a hospitality
industry lobby group whose members stand to benefit from a
government-ordered Productivity Commission review of the Fair Work Act
that is expected to examine the issue of penalty rates.
Mr Hart also sits on Prime Minister Tony Abbott’s Business Advisory Council.
The National Commission of Audit
was officially announced by Treasurer Joe Hockey, and Finance Minister
Senator Mathias Cormann, on October 22, 2013, to be led by Tony
Shepherd, former Business Council of Australia president and chairman of
Transfield Services.
Mr Shepherd’s appointment was seen as being particularly controversial because as head of the BCA he had been critical of the previous Labor government policies such as the National Disability Insurance Scheme and the Gonski schools funding reforms.
His appointment was also questioned because of his links to companies that had benefited from government contracts.
Mr Shepherd stepped down as chairman of Transfield Services upon his
elevation to the Commission of Audit. Transfield, a construction and
services firm, won a string of contracts in recent years worth hundreds
of millions of dollars, including the contract for maintenance and
support services at the Nauru detention centre.
The other commissioners are former senator and minister in the Howard
government, Amanda Vanstone, and former senior public servants Peter
Boxall, Tony Cole and Robert Fisher.
The coalition predicted in its midyear Budget update that the
commission would spend about $1 million but figures show it cost
taxpayers about $2.5 million to produce the audit. That’s a 150% budget blowout from the panel advising us how to “live within our means”.
It cost $1.9 million for expert staff drafted in from the departments
of Finance, Treasury and the Prime Minister and Cabinet to work on the
study.
The head of the commission’s secretariat, Peter Crone, was paid
$157,000 to oversee the probe, while the commissioners were paid $85,000
each for their five months work.
Consultants Boston Consulting Group were paid $50,000.
And then there’s the NBN.
As the rollout of superfast broadband slows down across the country,
consultants have been the biggest winners, pocketing millions of dollars
from numerous reviews and cost-benefit analyses.
A Question on Notice tabled in Federal Parliament revealed the
external consulting cost for the NBN was $10.1 million. The cost of
implementing the recommendations was not included, the 2016 deadline has
been abandoned, and the new agreement with Telstra is yet to be
concluded.
Boston Consulting Group, KordaMentha and Deloitte Touche Tohmatsu
received the biggest financial boon from the government-commissioned
reviews.
Then there are the Royal Commissions.
The Government will provide $53.3 million over two years (including $5.3 million in capital funding) to conduct the Royal Commission into Trade Union Governance and Corruption.
The cost of this measure will be offset by redirecting funding from
the Employment, Industry and Infrastructure and Regional Development
portfolios.
Even though there have been coronial enquiries, inquests,
administrative investigations and a full government audit report into
the Home Insulation Programme’s problems, Abbott found another $25 million for a Royal Commission.
We then have the Warburton led review into the Renewable Energy Target.
The Climate Change Authority was legislated to conduct this review,
which they will still do to “keep them occupied” according to Greg
Hunt. To get the results he wanted, he chose to conduct his own review
led by climate change sceptic Dick Warburton and representatives of
fossil fuel producers and users.
A Senate Committee was told the total cost of the review was
$587,329. That figure does not include the salaries of the staff on the
secretariat or overheads such as IT and accommodation.
Mr Warburton received fees in the order of $73,000; Mr Fisher $39,900; Ms In’t Veld, $43,900; and Mr Zema, $29,700.
Clean energy representatives were shocked by the panel’s appointment
as chief advisor and modeller of ACIL Allen, a consultancy seen as close
to the fossil fuel industry, and whose highly contested research formed
the basis of the coal industry’s attempts to dismantle the RET in 2012.
They refused to include in their modelling the benefits of renewable
energy – including the health benefits, job benefits, and the network
benefits – which the panel dismissed as “too hard to model” and little
more than a “transfer of wealth”, presumably away from the coal
generators and network providers.
ACIL Allen were paid $287,468 for their modelling
We also have seen Christopher Pyne’s National Curriculum Review
which cost $283,157 to tell us we need less Indigenous focus and more
Judeo-Christian, less creativity and more rote learning, and less about
progressive reform and more about business.
Kevin Donnelly and Ken Wiltshire appointed 16 external experts to
make contributions, including Barry Spurr, each of whom were paid $8250
for their reports.
This government’s intentions are clear. They have bypassed government
departments and statuatory bodies, ignored expert advice and the
results of previous reviews, to pay hundreds of millions to consultants,
vested interests, and party hacks to produce the results that endorse
their stated policies or that damage the previous government.
This is indeed the Age of Consultancy.
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