IT suppliers overcharging UK.gov

Says recruitment firm that wants its share of the pork

By Mark Ballard • Get more from this author

Posted in Public Sector, 2nd March 2007 10:49 GMT

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IT firms are ripping off the government by charging more than twice the market rate for staff, according to a recruitment company.

ReThink Recruitment said in a statement that IT outsourcers hire staff for about £700 a day before posting them to work on government contracts at a charge of up to £2,000 a day.

Managing director Jon Butterfield said the public sector found it harder to control its staffing costs when it outsourced its project management to external consultants.

The supply chain for key IT project skills was several tiers high, he said, and the link at every level was taking a cut. "The final rate the outsourcing provider bills the client is often several times the original price of the skill at the bottom of the chain."

Unsurprisingly, Butterfield said the public sector could save money by doing its project management inhouse and hiring its staff direct from a recruitment supplier.

Nevertheless, ReThink's statement said that project managers, business managers, technical architects, software consultants, programme managers and IT directors were all hired out by recruitment firms at a charge of between £600 and £650 a day. They would then be posted on government contracts between £1,200 and £2,000 a day. ®

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