Labour MP Reeves blasts government over outsourcing ‘cronyism’

Labour minister Rachel Reeves has called today for “the biggest wave of [government] insourcing in a generation”, in delivering a damning critique of outsourcing amid claims of a government “chumocracy” in issuing contracts to party donors and friends.

“By cutting the cronyism and waste that comes with outsourcing, we can rebuild the foundations of our public services and strengthen the resilience of our communities and our country,” Reeves said.

Writing in the Guardian, Reeves called for the government to reintroduce “proper competitive tendering”, publishing all outstanding Covid contracts by the end of February and expanding the Freedom of Information Act to apply to private companies when delivering new public service contracts. 

“Even before the pandemic, the government spent an extraordinary £292bn on outsourcing in 2018-19,” more than a third of all public spending in a year, Reeves said. “It’s only fair that the tax payers who are paying for these contracts can scrutinise them.”

Reeves said a Labour government would “put valuing our public services at the heart of our contracting procurement process” as she lambasted “so many wasteful contracts handed out to Tory friends and donors during the Covid-19 crisis”. 

“The government’s approach to outsourcing has underlined the ‘one rule for them, another for us’ mantra that surrounds Boris Johnson’s cabinet,” Reeves said. “But it has also shone a disturbing light on just how deeply the Tories have hollowed out our public services.”

She noted that key workers in public services had failed to receive a pay rise, while management consultants at Deloitte were paid up to £1k a day to work on test and trace, “a system that still isn’t up to scratch”.

Reeves also alleged that “qualified and experienced” British businesses had been overlooked for government contracts in favour of firms with political connections. Further, she pointed out, the government’s anti-corruption champion has “gone from being a ministerial position to a backbench one with no teeth whatsoever”.

“So,” she said, “Labour will introduce an independent commissioner on anti-corruption and an integrity and ethics commission to prevent corruption and cronyism, and once again aim to be a world leader on transparency and open governance.”

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