Money is being wasted by Whitehall on consultants, according to a report released by the National Audit Office. It suggests that the cost of employing the agencies, totalling £600million, could be reduced by at least 10 per cent.

The figure includes such items as payroll administration and recruitment advertising, but the bulk of the cost, £231 million in 1999-2000, was on management consultants.

Possible measures include improving negotiations with companies and looking for better quotes, which the NAO estimates could save £45 million, and departments consulting each other, which could save a further £3 million. The report has also found that a third of contracts were not open to competition.