Attempts to save are wasteful

Friday, May 16, 2008

Truth, as the saying goes, is quite often stranger than fiction. Some of the best stories also contain the greatest amounts of irony.

File this story under that category.

The State of Iowa, seeking to gain greater efficiencies, hires a consultant to study state government. The state paid an out of state consultant, Chicago-based A.T. Kearney Inc., $3.7 million to recommend efficiencies that save the public $2.7 million.

Yep, we paid a million more than we saved for the advice to save.

Not exactly the way to run any type of business, especially one paid for by taxpayers. State Auditor David Vaudt has performed two audits on efforts by the state to gain efficiencies, using consultants.

According to an Associated Press report, the latest audit focused on other agencies and found that the state paid $882,260 for recommendations that resulted in $50,325 in savings. Gov. Chet Culver has ordered that payments to the consultant be halted and the state has denied a bonus to the firm for its work. Oversight of the issue has been shifted to the Department of Management, putting the issue more directly under the governor's control.

Charles Krogmeier, who heads that agency, conceded that projected savings had not been realized. He noted that payments to the consultant had been halted during the review and that that there is the potential for additional savings down the road.

The new audit found that additional savings were possible in the future but concluded they could total only $571,140.

It is our sincere hope that outside consultants, especially out of state consultants, were brought in only after state employees had been consulted about their ideas for efficiencies, since the people who actually do the work often have the best ideas on how to make things better. After all employee suggestions had been implemented and there was a need for an "outside eye," bids would have been sought from an Iowa firm.

Investing foolishly in your own state is preferable to spending your money out of state. At least money spent in Iowa stays in Iowa for a little while.