During the 2021-22 fiscal year, the federal government allocated $888 million to consultancy-linked contracts, which is a significant rise from the $352 million in 2012-13.
And this trend seems to echo the adage: ‘work smarter, not harder’ when reflecting on the consulting landscape over the past decade.
But all good things must come to an end, and an analysis by The Canberra Times shows the big four firms secured 844 contracts, valued at $813.2 million, from July 2022 to June 2023, which is a decrease from the prior year when they obtained over 1,200 contracts worth $1.46 billion.
So with the government finally cracking down on consulting contracts, the big four firms like KPMG are under the spotlight after the recent tax breach scandal.
Yet, with the increased revenue and profits from the Big Four consulting firms over the years, one wonders if the trickle-down economic principle has been effective in this reconciliation scenario?
KPMG ReconciliACTION Score
KPMG Reconciliation Action Plan Pros:
- From FY18-20, $6.6M was spent with 27 Indigenous suppliers.
- Pro bono services were provided to 53 organisations between FY18-20, which supposedly was worth $7M.
- Hired 55 Indigenous individuals from 2017-2020, with a 67% retention rate.
Reconciliation Action Plan Cons:
- In Australia, KPMG has approximately 10,000 people, including more than 600 partners, with offices around the country… but KPMG’s goal is to hire only 135 Aboriginal and Torres Strait Islander people, which is only 1.35% total staff.
- $7M pro bono sounds great, but the amount has to be questioned when consultants can charge a lot of money for very little work or impact.
- Government contract extensions with KPMG in 2022-23 were $412M, so $6.6M is only 1.6% of their contract extensions… which is peanuts compared to what they could be doing.
The recent scrutiny faced by firms like KPMG, especially in light of the tax breach scandal, indicates that the golden era of unchecked consultancy contracts might be waning… and the government’s crackdown is a testament to the growing demand for transparency and accountability.
KPMG’s Reconciliation Action Plan, while commendable in its efforts towards Indigenous inclusion, also raises eyebrows… because the disparity between their overall staff and their target for hiring Aboriginal and Torres Strait Islander people is very stark.
In addition, though substantial in absolute terms, the proportion of their contracts dedicated to Indigenous suppliers is minuscule relative to their overall dealings.
And while seemingly generous, the value of their pro bono work also warrants a closer look, especially in an industry where services can be exorbitantly priced.
In essence, while KPMG’s efforts towards reconciliation are a step in the right direction, they also serve as a microcosm of the broader consultancy industry’s practices.
And it’s imperative to look beyond the surface, to question, and to demand transparency.
Because as the government and taxpayers have increasingly realised, it’s not just about the money spent or contracts signed; it’s about the tangible, lasting impact these firms have on the community and the nation at large.
So the call of the hour is not just reconciliation in terms of Indigenous relations but a reconciliation of values, practices, and outcomes in the consultancy domain.
Barayamal Rating: /5
Public Rating of RAP: /5
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