MOD “paying £3000 – £5000 a man-day” to procurement consultants appointed without competition?

We have more - from unofficial MOD sources - about the MOD's £12 million, single-tender consulting contract awarded without competition to AlixPartners. As our information came from unofficial sources, we asked MOD last week for confirmation or otherwise of it.

We know a response is ready for us, but it's release has been delayed for reasons that are unclear - we wonder whether it might be that Cabinet Office are now looking into the matter? We have the distinct impression (although this is only an impression) that Cabinet Office, who should sign off major Whitehall consulting spend, did not know about this deal.

So we're tired of waiting anyway. Here is what we are told - and MOD have certainly failed to deny any of this up to now.

1. Our sources say that AlixPartners are charging day-rates that are in the main between £3000 and £5000 a person-day. No, I haven't added an extra zero by mistake.

2. There may also be a 'success fee' bonus on top of this, which is, we are told, significant.

3. The contract originated in the MOD Commercial Directorate.  It is purely down to officials; we do not believe there was significant Ministerial involvement. And, for the avoidance of doubt, and because they've both been mentioned in Spend Matters several times in different contexts, we do not believe that either Bernard Gray, Chief of Defence Materiel, or Les Mosco, Commercial Director in Gray's organisation, had anything to do with it.

4. Indeed, we are told that the deal was resisted by some senior people in MOD, but the originator(s) of the deal ignored or overruled them and went ahead anyway.

5.  One of the key MOD stakeholders is an ex-colleague of an AlixPartners senior executive who was involved in negotiating the deal. We're not suggesting for a moment that anything corrupt has gone on, but that may give some sort of answer to the 'why AlixPartners' question. One source also suggested that 'most of the big consulting firms have worked before for MOD in commercial areas and that has discredited them in some people's eyes - hence using a firm who are untainted by past failures'!

Our next step?  Well, let's see what MOD say.

Then, if MOD continue with the contract, a letter to the Permanent Secretary I think, asking her to suspend the contract immediately while the circumstances of its award are examined. Let's just remind ourselves; in our view, this was awarded in breach of UK and EU procurement regulations, with no competition, so no assurance of value for money, transparency or propriety, to a firm with limited experience in this market.

The more we get into this, the more it stinks.

Voices (4)

  1. Flog:

    Of course, a ‘concerned citizen’ could submit a complaint directly to the EU Commission and request that their identity remain confidential. No cost to the ‘concerned citizen’ and major headache for MOD and the UK

  2. Dan:

    ” It is purely down to officials; we do not believe there was significant Ministerial involvement.”

    Unusual. Its often the politicians who are driving single-tender deals like this.

  3. Final Furlong:

    The MOD should know better than anyone that silver bullets can be very expensive…

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