Govt spends $1b on big 4 consulting firms

Nick Xenophon wants the auditor-general to investigate the process involved in awarding $1 billion in contracts to four consulting firms between 2013 and 2016.

Nick Xenophon

Nick Xenophon is querying the government's spending on consultancies. (AAP)

The federal government is facing calls to explain why it has spent almost $1 billion on Australia's four biggest consulting companies in the past few years.

Ernst and Young, KPMG, PricewaterhouseCoopers and Deloitte were awarded more than $420 million worth of contracts in 2015/16.

That was more than double the $196 million they received in 2013/14.

Senator Nick Xenophon said the figures, released by the Finance Department in answer to a question on notice from Budget estimates, were "staggering".

He wants the auditor-general to investigate the process involved in awarding a total of 2,743 contracts valued at $998.3 million.

"The government needs to urgently explain why at a time of belt tightening for practically everyone else, they seem to have let rip for the big four consultancy firms," he said in a statement on Thursday.

The exponential increase in payments to those companies raised serious questions, he said.

"Surely there's enough expertise amongst 243,000 Commonwealth public servants to have provided a lot of these services that taxpayers have forked out nearly a billion dollars for in just three years."

KPMG has been the biggest beneficiary by far, winning more than 1200 contracts worth $395 million.

Senator Xenophon said there was anecdotal evidence smaller firms were missing out to the larger four.

"The government needs to give a breakdown of these contracts, what they are for, why it couldn't have been done in-house and whether there was a competitive tender process for them," he said.


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Source: AAP


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