Consultants are much happier away from the spotlight. Which is why it was interesting to see McKinsey and Boston Consulting Group (BCG) listed to front the Senate inquiry into Australia Post later today.
Turns out McKinsey was having none of it. The blue-chip firm, which has raked in millions in COVID-19 related government contracts, has “declined” to appear, Crikey understands — apparently on the grounds that it only received notice on Friday. The program has been updated to include former Australia Post executive manager Philip Dalidakis instead.
Neither McKinsey nor BCG made a submission to the Australia Post inquiry, which is examining the ousting of Christine Holgate as CEO. However BCG has been mentioned several times in relation to its work examining the privatisation of the government agency.
McKinsey’s addition was a little bit more mysterious. And its decision to decline raises even more questions. The company’s listing on the inquiry’s program over the weekend had reportedly sent chills down the spine of its other clients. But perhaps no one had more to fear than the government itself.
Crikey was hoping to see if any other areas of McKinsey’s work were discussed during the hearing, chaired by Greens Senator Sarah Hanson-Young — particularly regarding the lucrative contracts it has secured to advise the government on the botched COVID-19 vaccine rollout.
Those contracts include a $3 million deal with the Department of Health, as well as two contracts with the Department of Prime Minister and Cabinet worth $2.4 million and $206,000.
Crikey has been pushing for details on this work, particularly the contract with Health, after McKinsey made headlines in France over its role advising the government there on its own vaccine debacle.
At a cost of about $57,000 a day, taxpayers — most of whom are still waiting for a jab — have a right to know the basic details of the advice.
But even if we don’t get any answers, this serves as a pivotal moment for the consulting industry which has traditionally thrived in the darkness that the private sector — with its “commercial in confidence” mantra — affords it. It’s a moment that is well overdue.
Consultants have had their best year ever in Australia thanks to COVID-19. Federal government spending on consulting services last year eclipsed the $1 billion mark for the first time, according to industry website consultancy.com.au, rising from less than $980 million in 2019. McKinsey and BCG have been some of the big winners in this, doubling their recent government contracts in the past 24 months.
But now that they have to front up to Senate inquiries like humble public servants, will they think twice about the type of work they take on?
At the very least it should make them rethink their closed-door approach to taxpayer-funded work. Transparency experts say this has wrapped the government’s pandemic response in a cosy blanket of secrecy.