2025-08-26
The Labor government increased its spending on consulting contracts every year of the last parliament, despite boasting savings on consulting contracts, according to newly compiled data from the Parliamentary Library.
In 2024-25, Labor spent nearly $1 billion on outsourcing work to consulting firms, more than the last year of the Morrison government in 2021-22.
Labor’s big spend on consulting firms looks to continue with the government spending $76.5 million on 90 consulting contracts in the first two weeks of 2025-26 - that’s nearly 8% of their total spend in 2024-25 in just two weeks.
While Labor has reduced its contracts with the Big 4 consulting firms (PwC, KPMG, Deloitte and EY), which the Greens welcome, the majority of spending and the number of government contracts are now going to consulting firms that are not one of the Big 7 (Accenture, Boston Consulting Group, Deloitte, EY, McKinsey, KPMG and PwC).
The Greens say Labor’s excessive outsourcing of public sector work to the private sector at three times the cost isn’t just wasting taxpayers’ money, it's eroding Australia’s public service.
Lines attributable to Greens finance and public service spokesperson Senator Barbara Pocock:
“Labor has boasted savings on consultants every year it held office in the last parliament. Yet Labor spent more last year on consulting contracts than the final year of the consultant-addicted Morrison government. The numbers speak louder than their empty words.
“This data paints a picture of a business as usual approach following the PwC consultancy scandal and a continued lack of transparency by a government which claims to be spending less, while in fact spending even more.
“While Labor says they’re spending less on consultants, this data shows that instead of spending as much on the Big 4 consulting firms, the government is spending even more money but just on other firms. What’s clear is that the government has been claiming that it has been reducing spending on consultants, but all they’re doing is arranging deck chairs on the Titanic.
“Labor promised, as part of their election campaign, to cut $6.4 billion in spending by reducing consultants’ contracts and outsourced service delivery. Yet in the first 24/25 financial year, Labor spent a whopping $968 million on consultancy firms, up from the previous year’s $653 million.
“Already in the first two weeks of this financial year, the government has spent $76 million on 90 contracts. This is a government that has said it wants to eliminate wasteful outsourcing yet all signs point to Labor being no different to previous governments - it’s one big smokescreen.
“We know that outsourcing public service work to the private sector costs three-times as much as hiring public servants to do the work and we know it’s eroding our public service - so why this government is spending even more on consultants is beyond belief.
“The Greens have consistently called on the government to provide a transparent breakdown of the spending data. I’ve repeatedly asked this government direct questions about Senate Estimates about their spending on consultant firms, but they have consistently refused to provide this, they refuse to separate the amount spent on consultants from the overall spend on external contractors. The people of Australia have a right to know where their taxes are spent - where is the transparency?”
Key data:
- In 2024-25 Labor spent nearly $1 billion on outsourcing work to consulting firms ($968.6 million in 2024-25).
- Labor spent more on consulting contracts in 2024-25 than the last year of the Morrison government in 2021-22 ($787.6 million in 2021-22 compared with $968.6 million in 2024-25), that’s a 23% increase in spending on consulting contracts.
- This big spending trend looks to continue, with the Labor government spending $76.5 million on 90 consulting contracts in the first two weeks of 2025-26. That's almost 8% of their total spend in 2024-25 in just two weeks.
- The Labor Government increased its spending on consulting contracts every year last parliament, despite boasting savings on consulting contracts ($622 million in 2022-23, $653 million in 2023-24 and $968.6 million in 2024-25).
- Labor has reduced its contracts with the Big 4 consulting firms. Spending on consultant contracts reduced by 47% between 2021-22 (Morrison) and 2024-25 (Albanese).
- The majority of spending and contracts are now going to consulting firms that are not one of the Big 7 (Accenture, Boston Consulting Group, Deloitte, EY, McKinsey and PwC).