Edmonton spent $600 million on consulting firms in 5 years

17 July 2019 Consulting.ca

The city of Edmonton spent $616 million on consultants between 2013 and 2017, and councilors are demanding accountability.

A report from the city auditor on November 2018 found that the Albertan city spent an average $123 million on consultants annually between 2013 and 2017.

Municipalities enlist consulting firms to provide services in a range of areas, such as engineering, management, communications, and IT. Government managers defend consulting contracts with the argument that they provide expertise that cannot be reasonably sourced within the public service, or they provide temporary, project-based work that is cheaper than hiring on permanent staff – if they could even find the right talent in the first place.

"We supplement our resources to support us through different bits of work where we don't need that skill set all the time," Todd Burge, Edmonton’s chief financial officer, told the CBC in November.

The city audit, however, found that $245 million of the consulting services were not properly reported by city staff – either miscoded or categorized as something other than consulting services.

Edmonton spent $600 million on consulting firms in 5 years

$165 million of the total consulting bill was spent on change orders – a situation where the consulting engagement expands, generally. In one example within the audit report, an engineering advisory contract to repair a public facility ballooned from its initial $1.7 million cost to $5.4 million because of unforeseen asbestos and electrical issues.

City auditor David Wiun recommended better training for city staff in reporting consulting costs, while also recommending alterations to the consulting planning process to reduce the amount of change orders.

Edmonton city councilors Aaron Paquette and Mike Nickel are unhappy with the size of the city’s consulting spend, and with delayed progress on the auditor’s recommendations.

"Frankly, $600 million in consulting fees over five years is dumbfounding," Paquette said earlier this month.

The city has yet to report back with evidence it’s working on implementing the auditor’s recommendations. "Those results were supposed to be back last month. They're not," added Paquette.

Fellow councilor Mike Nickel likewise hopes the city can improve its consulting engagement planning and costs tracking. “People just want to get a handle on who's getting paid for what and are we getting value for it,” he told CBC News. “When $250 million worth of consulting contracts go mischecked or uncoded or misquoted in our accounting system, of course this is a huge red flag."


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