Should the city council pay a firm £1.46million to save taxpayers millions?
COUNCIL chiefs have paid an accountancy firm £1.46million – to help them save money.
Sunderland Council forked out the cash to financial services giant KPMG over the last three years – including £1.2million in 2010/11 alone.
The authority said the firm provided international expertise and was paid based on how much it helped save – which amounted to more than £20million in the last two years.
But critics claim the decision was a mistake, arguing the money would have been better used protecting services.
Former Tory group leader Lee Martin, said: “I think paying a private company £1.5million to tell them to save money is atrocious.
“If we have to pay KPMG to tell us how to save money, then why are we paying senior council officers such massive amounts of money?
The Barnes councillor claimed KPMG had been brought in to “manage out” jobs to make it look like redundancies had been avoided.
He said the £1.5million would be better spent keeping council workers on the payroll.
His remarks were rebuffed by David Allan, the senior Labour councillor responsible for resources.
Coun Allan said KMPG worked with the council as a partner on the “Sunderland Way of Working,” to make savings to improve services and meet the demands of Government cuts.
“We aren’t paying £1.5million out to KPMG and telling them ‘here you go, go and find us £10million’s worth of savings’,” said the Sandhill councillor.
“What we’re saying is ‘we will work with you as a partner and if you can save us money – in addition to what we can save on our own – we will share those savings with you’.”
He said the council did have some “extremely competent” senior officers, but KMPG brought different skills.
“What it is bringing is expertise nationally, and internationally, on how to make vast savings within our political parameters.
“As we’ve said before, our aim is to do that without making people compulsorily redundant and without cutting major front-line services.”
Coun Allan rejected Coun Martin’s claims about job losses, adding: “I think Coun Martin has a nerve, because he has previously complained in the council chamber that there were far too many people working for Sunderland City Council.”
Malcolm Page, executive director of Commercial and Corporate Services, said KMPG provided “the capacity and skills” needed to make “significant savings.”
Mr Page said this included cuts in procurement, ICT, property costs and customer services, and opportunities to improve the effectiveness of services and “customer experience” had also been identified.
He added: “The efficiency savings forecast to be delivered in 2010/11 and 2011/12 of £3.029million and £17.416milllion, respectively, have played a major part in helping to deliver a balanced budget for 2011/12.”
He said KPMG was also paid for consultancy work supporting the Building Schools for the Future programme and other projects.