Anyone understands why the Australian senators are attacking Deloitte's executive compensations instead of the government leadership that signed the pricey contracts with consulting suppliers in the first place?
Labor senators. With the 2015 introduction of the Average Staffing Level cap, the shrinking of big government (read: selling off everything that wasn't bolted down) was wild.
This was always part of their platform to reverse that trend and Robodebt/ATO leaks handed them a free kick https://www.abc.net.au/news/2023-05-19/promise-check-abolish...
They are doing both, the current left leaning government is examining both the firms, and their utilisation by the government (in practice, the previous conservative government) . For example, see https://www.abc.net.au/news/2023-05-06/public-service-audit-...
It's questionable whether bringing the cost in-house will be cheaper. Australian public servants come with a very large price tag that not even our sovereign wealth fund can handle.
Like a good CEO for the big 4 consulting firms that no one else can compete with he wants all the good PR he can get right now, but the question still remains whether paying this man egregious amounts of money is more expensive than paying some boffins in Canberra to do the same job.
Relatively easy to get rid of consultants and contractors. A lot harder to get rid of permanent staff even if they don't perform well. This means you may need 2-3x the headcount in comparison.
The government mostly hires staff on 3 year contracts anyway. Not much different to a 2 year consultancy contract, except the hourly rate is 3x as much.
I got friends in KPMG and they bill on the order of 900/hr per team. I have little doubt the consultants work harder -- they bloody well better -- but if that's 2x or 3x the regular hires is absolutely up for debate. I'd argue probably not.
And it leaves out the main point: most of these consultants are blame shields for officials -- "we moved to technology X because Bain & Deloitte told us to". But when you look at the numbers, the spreasheets don't add up, and it's clear that a VP decided this was the course and needed ammo to back it up.
You really can't assume that. The whole idea that contractors are somehow cheaper has been put to the test a lot of times and often comes up bullshit.
What you CAN do is hide the spending under separate line items so it looks cheaper, don't mind that all these government projects got more expensive by an amount 20% higher than we saved on the public service.
EDIT: I think I maybe interpreted your comment as the opposite of what you meant.
lol, please tell me you're not talking about the "Future Fund".
> the question still remains whether paying this man egregious amounts of money is more expensive than paying some boffins in Canberra to do the same job.
this is an extremely bizarre take, given the Big 4 have been fleecing the government for a very long time, partly due to no interest in stopping them.
> lol, please tell me you're not talking about the "Future Fund".
What other sovereign wealth fund is there?
It's not even capable of meeting future public servant pensions, this is unequivocal and openly talked about in the 2023 budget. The Future Fund is $70B short to simply break even on it's liabilities.
> given the Big 4 have been fleecing the government for a very long time, partly due to no interest in stopping them
Again, you are making the claim that the public service can do it cheaper? Do you have any evidence to back that up? I don't disagree that the Big 4 consulting firms are making out like bandits with taxpayers money but it's fair to ask whether the public service can do it for cheaper. Simply assuming that is the case comes across as very ideological rather than an evidence based opinion. Public servants have much higher wages and super costs than the hordes of young employees at consultancies, it doubtful they can produce more per hour to make up for the difference.
The comparison gets interesting in Australia (as opposed to say the US), since Australia’s neighbor Singapore pays its prime minister $2 million a year. The average Singapore government official makes $10,000 a month.
Singapore has a unique philosophy when it comes to civil servant pay
Yeah, I would much rather live in a world where some disconnected busybody goes around assigning salaries to everyone based on $CURRENT_SOCIAL_TREND, than to have wealthy people who feel guilty about their earnings. /s
They are indeed barking up the wrong tree. Rather than asking what Deloitte pays this guy, they need to be asking what the government pays Deloitte and for what?
The rising class consciousness I've seen this year has really warmed my cockles. One thing I've realized is very few people actually know what capitalism is but they sure as hell will defend it.
Capitalism is simply the economic system for the extraction of wealth from the poor to the wealthy where once it was from the poor to the monarch and the artistocratic class (ie feudalism). That's it. Someone will be tempted to pipe up with something about "free markets". Markets are commerce. They happen in every economic system.
So you see a lot of people flounder in this area in a way that is curable with the barest introduction to Marxism, specifically the labor theory of value [1].
So profiteering off government contracts is nothing more than the extraction of wealth from the poor to the rich via the government. Yet you'll find many who say we're simply not doing enough capitalism.
This is also why culture war issues are manufactured: to stop the development of class consciousnes and solidarity. It is an intentional distraction so you won't pay attention to the wealth transfer going on through tax cuts, deregulation and, of course, government contracts.
> Capitalism is simply the economic system for the extraction of wealth from the poor to the wealthy where once it was from the poor to the monarch and the artistocratic class (ie feudalism). That's it. Someone will be tempted to pipe up with something about "free markets". Markets are commerce. They happen in every economic system.
Capitalism is buyer, seller, marketplace, and sufficient regulation to prevent sellers from buying the marketplace.
Materialism, not captialism, leads to the class distinctions that the Marxists fetish (as they boost themselves into aristocracy while shrilly claiming to give a French frigate's fo'c's'le about the workers).
The proper remedy for the excesses of capitalism is ensuring competition in the marketplace, to stabilize the system.
> So profiteering off government contracts is nothing more than the extraction of wealth
I would agree with this statement. However I wouldn't call this capitalism. It doesn't seem like "free-market" anything when the government is footing the bill. There's an enormous amount of cronyism... was the work actually bid out, and evaluated fairly? Is the work even something that actually needs to be done, or is it more of a make-work project, or a spend-to-justify-our-budget project? Were small, non-connected firms allowed to bid, or was it an add-on to a pre-existing engagement? Private companies, especially large ones, are guilty of the same but government usually tops the list for wasteful and inefficient spending.
So yes, it is indeed profiteering, and these huge consulting firms have perfected it. But it's only because the government keeps rewarding them over and over, so who can blame them for scooping it up? But this is not capitalism.
It is capitalism because it is bad. Even though it directly contradicts what every single "pro capitalism" thinker ever said, enormous state investments into massive, but useless systems are absolutely capitalist praxis.
First, "free market" itself is a myth. Second, that's a tenet of libertarianism or neoliberalism. In reality, "free markets" is a stalking horse for deregulation and privatization, which is wealth extraction from the government to the wealthy. Like I said, capitalism has nothing to do with markets. It's merely how capital is created and accumulated.
You talk about cronyism and the process and have skipped right passed the most important question: why is this even being outsourced in the first place? Why is public transit privatized (eg the UK)? It's needless wealth transfer under the guise of "efficiency". European democracies are starting to discover they're on the same path of the USA: starving national healthcare and then using those "failures" are reasons to privatize it. Reportedly, with Brexit, the US administration wanted the NHS to be privatized as part of any favorable trade deal with the UK. Think about that.
Now we see a cost-of-living crisis because of restricted supply and institutional buyers buying up the supply. Mortgages are massively bigger than even a generation ago. The cost of college education is out-of-control, as is healthcare. Debt is being built into every facet of your existence to extract as much wealth as possible from you and to keep you a compliant worker.
Trad Marxism is absolutely hilarious. Nowadays a significant portion of the population own the means of production, e.g. laptops, but somehow capitalism is going as strong as ever.
Also quite funny to see people going on about "class consciousness" when almost everybody in the first world is living a life of luxury unimaginable one hundred fifty years ago.
I'm confused by the analogy. Let's use the iconic steel mill from the industrial revolution. Even if you gave me the machines, I still need the feed stock, electricity, and a bunch of fellow-workers (Carnegie said his workers were the most important part of his business). Sure, now most folks like us can buy a laptop and an internet connection, most business ventures need a bunch of folks working together to make a company. We love to glorify the solo-prenuer, but that's pretty rare.
>Sure, now most folks like us can buy a laptop and an internet connection,
Making you the owner of the means of production. Trad Marxist theory sees that as one important goal in abolishing capitalism, but somehow capitalism remains just as strong. Curious...
That you need others to work as well is true of all production, it is obviously true under marxism as well and marx certainly did not argue against it.
With all due respect, if he goes up there, kisses the ring and successfully says whatever needs to be said to save a $712 million dollar government contract, he's worth a lot more than $3 million.
Is that true? I really don't see what special talent he's got that wouldn't be easy to replace for pennies on the dollar. What he has, that the rest of us don't, is the opportunity to stick his hand into a $712M cookie jar.
The best CEOs avoid sitting in chairs such as those chairs specifically. If you're sat there on behalf of your company, suit and tie, starting every sentence with "Senator, I.."—you have somehow messed up, big time.
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[ 2.8 ms ] story [ 89.3 ms ] threadLike a good CEO for the big 4 consulting firms that no one else can compete with he wants all the good PR he can get right now, but the question still remains whether paying this man egregious amounts of money is more expensive than paying some boffins in Canberra to do the same job.
Hard to tell.
Relatively easy to get rid of consultants and contractors. A lot harder to get rid of permanent staff even if they don't perform well. This means you may need 2-3x the headcount in comparison.
You save some. You lose some.
And it leaves out the main point: most of these consultants are blame shields for officials -- "we moved to technology X because Bain & Deloitte told us to". But when you look at the numbers, the spreasheets don't add up, and it's clear that a VP decided this was the course and needed ammo to back it up.
What you CAN do is hide the spending under separate line items so it looks cheaper, don't mind that all these government projects got more expensive by an amount 20% higher than we saved on the public service.
EDIT: I think I maybe interpreted your comment as the opposite of what you meant.
lol, please tell me you're not talking about the "Future Fund".
> the question still remains whether paying this man egregious amounts of money is more expensive than paying some boffins in Canberra to do the same job.
this is an extremely bizarre take, given the Big 4 have been fleecing the government for a very long time, partly due to no interest in stopping them.
What other sovereign wealth fund is there?
It's not even capable of meeting future public servant pensions, this is unequivocal and openly talked about in the 2023 budget. The Future Fund is $70B short to simply break even on it's liabilities.
> given the Big 4 have been fleecing the government for a very long time, partly due to no interest in stopping them
Again, you are making the claim that the public service can do it cheaper? Do you have any evidence to back that up? I don't disagree that the Big 4 consulting firms are making out like bandits with taxpayers money but it's fair to ask whether the public service can do it for cheaper. Simply assuming that is the case comes across as very ideological rather than an evidence based opinion. Public servants have much higher wages and super costs than the hordes of young employees at consultancies, it doubtful they can produce more per hour to make up for the difference.
Singapore has a unique philosophy when it comes to civil servant pay
Capitalism is simply the economic system for the extraction of wealth from the poor to the wealthy where once it was from the poor to the monarch and the artistocratic class (ie feudalism). That's it. Someone will be tempted to pipe up with something about "free markets". Markets are commerce. They happen in every economic system.
So you see a lot of people flounder in this area in a way that is curable with the barest introduction to Marxism, specifically the labor theory of value [1].
So profiteering off government contracts is nothing more than the extraction of wealth from the poor to the rich via the government. Yet you'll find many who say we're simply not doing enough capitalism.
This is also why culture war issues are manufactured: to stop the development of class consciousnes and solidarity. It is an intentional distraction so you won't pay attention to the wealth transfer going on through tax cuts, deregulation and, of course, government contracts.
[1]: https://en.wikipedia.org/wiki/Labor_theory_of_value
Capitalism is buyer, seller, marketplace, and sufficient regulation to prevent sellers from buying the marketplace.
Materialism, not captialism, leads to the class distinctions that the Marxists fetish (as they boost themselves into aristocracy while shrilly claiming to give a French frigate's fo'c's'le about the workers).
The proper remedy for the excesses of capitalism is ensuring competition in the marketplace, to stabilize the system.
> The meaning "political/economic system which encourages capitalists" is recorded from 1872 and originally was used disparagingly by socialists.
https://www.etymonline.com/word/capitalism
I would agree with this statement. However I wouldn't call this capitalism. It doesn't seem like "free-market" anything when the government is footing the bill. There's an enormous amount of cronyism... was the work actually bid out, and evaluated fairly? Is the work even something that actually needs to be done, or is it more of a make-work project, or a spend-to-justify-our-budget project? Were small, non-connected firms allowed to bid, or was it an add-on to a pre-existing engagement? Private companies, especially large ones, are guilty of the same but government usually tops the list for wasteful and inefficient spending.
So yes, it is indeed profiteering, and these huge consulting firms have perfected it. But it's only because the government keeps rewarding them over and over, so who can blame them for scooping it up? But this is not capitalism.
First, "free market" itself is a myth. Second, that's a tenet of libertarianism or neoliberalism. In reality, "free markets" is a stalking horse for deregulation and privatization, which is wealth extraction from the government to the wealthy. Like I said, capitalism has nothing to do with markets. It's merely how capital is created and accumulated.
You talk about cronyism and the process and have skipped right passed the most important question: why is this even being outsourced in the first place? Why is public transit privatized (eg the UK)? It's needless wealth transfer under the guise of "efficiency". European democracies are starting to discover they're on the same path of the USA: starving national healthcare and then using those "failures" are reasons to privatize it. Reportedly, with Brexit, the US administration wanted the NHS to be privatized as part of any favorable trade deal with the UK. Think about that.
Now we see a cost-of-living crisis because of restricted supply and institutional buyers buying up the supply. Mortgages are massively bigger than even a generation ago. The cost of college education is out-of-control, as is healthcare. Debt is being built into every facet of your existence to extract as much wealth as possible from you and to keep you a compliant worker.
Also quite funny to see people going on about "class consciousness" when almost everybody in the first world is living a life of luxury unimaginable one hundred fifty years ago.
Making you the owner of the means of production. Trad Marxist theory sees that as one important goal in abolishing capitalism, but somehow capitalism remains just as strong. Curious...
That you need others to work as well is true of all production, it is obviously true under marxism as well and marx certainly did not argue against it.
Impostor syndrome is real