Court of Auditors asks France to ‘better control’ consultancy services

While consultancy expenditure rose significantly in the last years, the French Audit Office (Cour des Comptes) warned against the still incomplete regulatory framework governing the use of consultancy firms, which are sometimes used under vague conditions.

Consulting firms are sometimes involved in functions that are part of the administration’s core business, or even in the decision-making process for a public policy, and in national sovereignty areas such as defence.

“Recourse to an external service can be a useful and sometimes essential solution”, explains the French Court of Auditors in a report published on Monday, but “practice has led to inappropriate use of consultancy services”.

The Court also pointed out that these expenses are not tracked and accounted for in the same way as those of government departments, even though they are involved in implementing public policies, making them difficult to assess.

France’s highest financial court also called into question the conditions under which consultancy contracts are prepared and managed and the less stringent controls associated with them.

The institution is concerned about certain outsourced services, which could have been carried out using state resources that were “available but not identified”. The French government says it is working to identify the existing skills within the administration to deal with this problem.

The report also shows that the use of consultancy firms has risen sharply over the last ten years. For intellectual services excluding IT, the sums involved have risen from €11 million in 2014 to €103 million in 2018, reaching a peak of €232 million in 2021.

At the beginning of 2022, now former prime minister Jean Castex set a target of reducing consultancy spending by at least 15%. This resulted in a 35% reduction between 2021 and 2022, according to estimates made by the Inspectorate General of Finance last March.

Although this flat-rate standard is “a strong incentive”, it demonstrates “the State’s inability to control this type of expenditure through targeted measures”. The court also points out the fragility of this data, as certain consultancy expenses have not been considered.

The court also added that of “almost three-quarters of the €890 million” spent by the State in 2021, “outsourced services concern the IT field”, particularly programming, which requires a very high degree of specialisation, which is not really available within the State services.

The financial institution is also concerned over certain “behaviours that circumvent” the rules, such as awarding contracts with no maximum amount.

The Court is therefore calling on the State to “better control” this expenditure. The Court notes that the “significant improvements” in the regulatory framework were only introduced recently, mainly since 2022, and still need to be completed.

This may involve the introduction of a framework specifying “the circumstances, rules to be respected and practical procedures for the use of intellectual services” and a more precise and harmonised “definition of the scope and procedures for the treatment of consultancy assignments.”

(Davide Basso | EURACTIV.fr)