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‘Help to Grow: Digital’ consultancy costs top £8m

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Consultation costs for the government’s failed voucher scheme to help small businesses adopt new technology hit £8m before the plug was pulled, with PwC, Deloitte and RSM all awarded contracts in the process.

30th Nov 2023
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A Freedom of Information (FoI) request filed by AccountingWEB has revealed that four firms shared a total of more than £8m for consulting on the government’s ill-fated attempt to ramp up digital skills and technology adoption through advice and discounts of up to £5,000 for small businesses.

The voucher-based ‘Help to Grow: Digital’ scheme launched in January 2022 to help small businesses adopt new technology, including accounting software, with a target of digitising 100,000 businesses. However, it closed less than a year later having hit just 1% of its sign-up target and costing the taxpayer £33m. 

As revealed in a previous FoI request, in spite of a £7m marketing campaign just 830 vouchers were redeemed (with accounting software making up just 191 of the total) thanks to a mixture of poorly chosen eligibility criteria and lack of appropriate software options. 

In its response to AccountingWEB’s latest FoI, the Department for Trade & Business revealed that PwC was awarded a contract “to run the grant administration service” for Help to Grow: Digital, with £4.2m spent under this contract before the scheme’s closure.

Deloitte was awarded a contract for “advice on the operating model, procurement and mobilisation” of the outsourced service, which cost £2.73m, while specialist consulting firm Matt Hamnett & Associates was contracted to “support an interim delivery service for the scheme” at a final cost of £719,000.

RSM UK’s consulting wing was appointed as the “Help to Grow: Digital independent evaluation partner, to conduct research into the impact of the scheme”. The contract value of RSM’s contract was £396,000.

Colossal waste of taxpayers’ money

One specific criticism of the scheme was that the Department for Business, Energy, and Industrial Strategy (BEIS – the government department responsible for the scheme, now part of the Department for Business & Trade) had opted to build the voucher-based system from scratch rather than pick from the numerous SaaS-based services already available.

Darren Fell, CEO of Crunch, one of the participating vendors, told AccountingWEB back in June: “All the selected providers, including us, had to invest heavily to plug into their bespoke system, which is now defunct. It’s a colossal waste of taxpayers’ money.”

Responding to AccountingWEB’s FoI, the Department for Business & Trade stated that a team within BEIS had built an initial temporary platform on gov.uk for the Help to Grow: Digital scheme with a plan to transition to a fuller system and service to be built by PwC following a tendering process. 

“The BEIS system worked very effectively and represented good value for money so this system was continued with,” stated the response.

The department also confirmed that the Help to Grow: Digital voucher application platform cost approximately £2.4m to build, separate to the consultancy costs listed above.

Autumn Statement taskforce intrigue

The Help to Grow: Digital scheme ran alongside the Help to Grow: Management programme, a 90% government-funded 12-week management course intended to help small business leaders grow. 

While it also did not hit its targets, the management scheme was marginally more successful than its digital counterpart, and last week’s Autumn Statement saw the government commit to the programme beyond 2024/25.

The Autumn Statement fine print also contained an intriguing passage [4.57] announcing that the government will set up a taskforce “to rapidly explore how best to support SMEs to adopt digital technology”.

Replies (4)

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Tornado
By Tornado
30th Nov 2023 10:01

Colossal waste of taxpayers’ money

This says it all, and applies to many other projects such as MTD

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By Justin Bryant
30th Nov 2023 10:53

It's nothing new and peanuts compared to this wasted total here: https://www.mirror.co.uk/news/politics/fury-tories-waste-100bn-taxpayers...

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By FactChecker
30th Nov 2023 11:38

Just as well that they've managed to maintain those printing presses ...

It's not just the headline £8m spent on three consultancies, there's also the £2.4m to build a system and £7m to advertise the 'offer' ... and that's before you account for the in-house costs (which is how presumably you end up with the £33m total mentioned en passant)?

So - 830 vouchers issued at an average cost (to us) just shy of £40k/voucher.
I'm sure any private sector organisation would consider that money well spent on handing out vouchers worth *up to* £5,000 each!

It would have been cheaper to just develop their own software and provide it as a free public service - not necessarily more effective but definitely cheaper - if they weren't so in thrall to the consultancies and software houses (who reward them in their twilight years with part-time sinecures).

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By Runagood Team
30th Nov 2023 16:03

The constant govt mistake is to use the mega consulting and accounting firms who have no experience or knowledge of businesses below the audit threshold (ie 94% of all businesses) for these schemes which is why they always fail. I have repeatedly proffered them low cost SME performance improvement solutions that use the 18000 small accountants who do understand their 5.7m small business clients who need practical help. My proposals get passed around until a civil servant writes "unfortunately this doesn't align with our current strategy". Which of course it doesn't because it's different. What's going on is laziness and back protection "no one got fired for hiring KPMG & Co"

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