UK Ministers Award KPMG £223M Contract Amid Spending Pledge

28 Aug, 2024

UK Ministers Award KPMG £223M Contract Amid Spending Pledge

The UK government has awarded KPMG a significant £223 million contract for training and development services across the civil service, despite a recent pledge to reduce spending on external consultants. The 15-month deal, the second-largest public sector contract ever secured by KPMG, involves managing a range of training programs, including those on policymaking, communications, career development, and accredited qualifications provided by universities and business schools.

The contract was finalized shortly before the Labour government announced plans to cut consultancy spending in the 2024-25 fiscal year as part of a broader initiative to reduce consultancy costs by £550 million in 2024-25 and £680 million in 2025-26. This initiative is aimed at saving costs and increasing efficiency by lifting the civil service headcount cap.

This large-scale contract comes amid KPMG's efforts to rehabilitate its reputation following corporate scandals and a substantial fine in 2022 for misleading audit practices. Despite these challenges, KPMG has resumed bidding for public sector contracts and successfully secured this deal, which represents nearly 8% of its annual UK revenue. The government clarified that the contract’s value is a maximum limit and any spending must ensure good value for money.