The Public Accounts Committee reports that "government is still not achieving
good value for money from the £1.8 billion spent on consultants" - corroborating the message of this book. There are several legitimate reactions to this.
One is that profligacy and incompetence is just what you'd expect. As Milton Friedman said: "If I spend somebody else's money on somebody else, I'm not concerned about how much it is, and I'm not concerned about what I get. And that's government."
Another - of course - is that it's a sign of New Labour's faith in the magical powers of management.
There is, however, another reaction. It's that New Labour's instincts are right here - the civil service is a failing organization; not all the multiple failure of government are due to consultants.
There are (at least) three factors behind this:
1. Motivation is low; this is a natural consequence of its enormous size.
2. The "gentleman amateur" culture of the civil service - the belief that if you've read Thucydides you can do anything - leads to turnover of senior civil servants between departments, with the result that insufficient expertise is accumulated.
3. Selection effects. When I left university in the mid-80s, few of my contemporaries entered the civil service; pay was poor relative to the private sector, and it was thought to be politicized. The upshot is that there's now a missing cohort - very few able civil servants in the late 30s-mid 40s. (though there are of course exceptions).
New Labour's instinct to look for outside help therefore has a kernel of justification. But only a kernel.
For one thing, this means they should have used consultants earlier. And it means the failure to transfer consultants' skills to permanent staff is especially deplorable.
More importantly, though, New Labour has failed to see a key truth. The main reason why the private sector is more efficient than the public sector is because the market acts as a cleansing mechanism, destroying (albeit slowly and imperfectly) bad management.
The solution to bad management is not to choose experts to solve the problem - the PAC, like the National Audit Office earlier, shows that this experiment has failed. Instead, incompetence is the inevitable result of lack of competition.