Premier
Category
Premier's Memorandum
Identifier
M2002-07
Status
Archived

M2002-07 Engagement and Use of Consultants

Description:

Premier's Department Circular 2000-47 'Guidelines for the Engagement and Use of Consultants' ('the Guidelines') sets out the key expectations of the Government in relation to agencies' engagement and use of consultants.

FunctionHuman ResourcesSubjectOutsourcing

Premier's Department Circular 2000-47 'Guidelines for the Engagement and Use of Consultants' ('the Guidelines') sets out the key expectations of the Government in relation to agencies' engagement and use of consultants.

Agencies should carefully assess the need to engage a consultant. Consultancies should only be pursued in instances where an agency is able to demonstrate that this will result in savings in terms of value for money compared to carrying out the work in-house, and where the necessary expertise does not exist within the agency.

This Memorandum outlines reporting arrangements to more accurately describe the nature and purpose of consultancies.

Describing the Nature and Purpose of Consultancies in Agency Annual Reports

The Guidelines define a consultant as:

"A person or organisation engaged under contract on a temporary basis to provide recommendations or high level specialist or professional advice to assist decision-making by management. Generally it is the advisory nature of the work that differentiates a consultant from other contractors".

The definition does not apply to casual or temporary staff employed or engaged by a NSW government organisation, and is distinct from the definition of 'contractor'. Agencies should refer to the Guidelines for detail and illustrations of the distinction between 'consultant' and 'contractor'.

The Annual Reports Regulations require that agencies include in their Annual Reports the following information concerning the engagement of consultants during the financial year:

For consultancies costing equal to or more than $30,000:

  • the name of the consultant;
  • the title of project (shown in a way that identifies the nature of the work); and
  • the actual costs of engaging the consultant.

For consultancies costing less than $30,000:

  • the total number of engagements costing less than $30,000; and
  • the total cost of all such engagements.

If no consultants were engaged during the financial year, a statement to that effect must be included.

In fulfilling the above requirements, agencies should group/categorise consultancies according to the nature of expenditure, and clearly describe the purpose of the consultancy. Categories of consultancy costs include:

  • Finance and accounting/tax
  • Information technology
  • Legal
  • Management services
  • Environmental
  • Engineering
  • Organisational review
  • Training

Although consultancies under $30,000 are not required to be individually identified, they should still be categorised, as above.

Attachment A illustrates a sample disclosure report to guide agencies in their reporting.

Copies of the Guidelines can be obtained from the Premier's Department Internet site under Ministerial and Parliamentary Services publications at http://www.dpc.nsw.gov.au under publications

For further enquiries regarding the Annual Report disclosure requirements, contact Dianne McHugh, Senior Policy Analyst, NSW Treasury on 9228 5340.

Bob Carr
Premier

 

______________________________________________________

Sample Disclosure Attachment A

_____________________________________________________________

Consultants equal to or more than $30,000

Consultant $ Cost Title / Nature
_____________________________________________________________

Finance and accounting/tax 
ABC Partners $X Advice regarding assessment of
risk management strategies
123 Ltd $X Review of Finance function
______________________________________________________________
 
Sub-total $X
 
Information Technology 
IT Solutions $X Development of specifications for
the Finance Module of Financial
Information System
Computer Specs P/L $X Advice on development of IT
strategic plan
______________________________________________________________ 
Sub-total $X
 
Legal  
Miscellaneous Law Firm $X Advice on legal issues arising
from the XYZ agreement.
______________________________________________________________ 
Sub-total $X
 
Total consultancies equal to or more than $30,000 $X

 
_____________________________________________________________
Consultancies less than $30,000
 
During the year X other consultancies were engaged in the following areas:

Finance and accounting/tax $X

Legal $X
 
Total consultancies less than $30,000 $X
 
Total consultancies $X