Ex McKinsey, Bain operative to run Canberra’s in-house consulting push

Joanne Rossiter has been appointed deputy head of the unit. She comes from the Department of Employment and Workplace Relations, where she led the national skills reform program. She is a former consultant with Nous and holds a Master of Public Policy from the University of Oxford.

AGC represents a new attempt at rigorous, structured problem-solving methodology with the stated ambition of “combining the best of public-sector expertise and private-sector approaches to quickly bring clarity to a client’s challenges”.

The appointment of the AGC leadership comes after the Albanese government issued strict new rules banning the use of private consultants for policy work and the development of cabinet proposals.

Agency heads have been told future consulting contracts include arrangements to transfer knowledge and skills to the Australian Public Service. This will include any intellectual property and is aimed at reducing the so-called “dumbing down” of the public service.

Instead, Mr Nipe will develop a network of policy specialists to be seconded for AGC projects. These include data analytics and evaluation, customer service and event management, foreign policy, geoscience, and technical skills such as curating of historical collections.

The AGC will also develop tighter terms and conditions for consulting contracts to ensure maximum value.

Other core APS functions are also to be brought back in-house as a priority, but with the rules noting arrangements may take time to adjust.

These include procurement and managing contracts, standard cost-benefit analysis (excluding major capital, infrastructure, complex IT and secure assets such as defence) and delivering programs and managing grants.

Public Service Minister Katy Gallagher said the in-house consulting function was part of a push to build on the deep expertise that already exists across the APS.

“Australian Government Consulting will offer public servants the opportunity to work across departments on projects that have, in the past, been outsourced to external consultancies,” Senator Gallagher said.

“Not only will this new function strengthen internal skills and capabilities by bringing important work back into the APS, but it will also save the taxpayer money.”

The service was partly modelled on Britain’s Crown Consulting, which was shut down after agencies baulked at using the centralised service.

The new Australian office comes after revelations of major confidentiality breaches by a former PwC tax partner led to a de facto ban on federal engagements with the big four firm.

Amid concerns about over-reliance on consultants, federal government spending on Australia’s top consulting firms was slashed by more than $500 million in 2022-23, after budget directives to save $3 billion in consulting and contractor costs.

The big four firms – KPMG, PwC, EY and Deloitte – plus Accenture won $1.2 billion in consulting and audit engagements last financial year, down from $1.7 billion in 2021-22.

A Finance Department audit found an external workforce, the equivalent of 53,911 public servants, had been engaged using contract, consulting and external labour-hire engagements.

The audit showed the federal government’s overuse of consulting and contractors was highly concentrated, and more than 75 per cent of its $21 billion annual external labour workforce was centred on the defence portfolio.

The aim is to practise and implement in-house consulting methodologies, such as cost-benefit analysis, with AGC staff collaborating with agencies. The skills they gain will be deployed across the broader public service.

The AGC has been rushed with nearly 1000 applications, more than any other PM&C recruitment outside graduate intake.