In 2023/24ALBs spent
£365.75 Bn
Grants-in-aid issued:
£267.92 Bn (73.3%)
Spending on Contingent Labour
£1.43 Bn (0.4%)
Spending on Consultants
£450.11 M (0.1%)
Cabinet Office | ALB Landscape Analysis 2023-24
ALB, Arm’s Length Bodies, Public Bodies, Quangos, Public Servants, Civil Servants
In 2023/24ALBs spent
£365.75 Bn
Grants-in-aid issued:
£267.92 Bn (73.3%)
Spending on Contingent Labour
£1.43 Bn (0.4%)
Spending on Consultants
£450.11 M (0.1%)
Cabinet Office | ALB Landscape Analysis 2023-24
Beyond spending from core budget allocations of RDEL, CDEL, and AME detailed previously, this page provides a dedicated examination of other significant spending streams for ALBs: grants disbursal, consultancy services, and the use of contingent labour. These are presented separately to offer clearer insight into these specific expenditure areas. It is important to understand that these are not distinct budget types separate from RDEL, CDEL, or AME; rather, they represent common ways in which funds allocated within these budgets are typically spent by ALBs.
Analysis of ALBs’ RDEL, CDEL, and AME spending can be found on our Spending page.
Grants spending captures the money spent by ALBs when issuing money as a Grants-in-Aid to other entities. A Grant-in-Aid is money given by one organisation to another organisation, which is used to support the activities and objectives of the receiving organisation. For example, Education and Skills Funding Agency issues grants to schools and academies as part of the National Funding Formula. In total, ALBs issued around £267.92 Bn in grants during 2023/24.
Cabinet Office | ALB Landscape Analysis 2023-24
Cabinet Office | ALB Landscape Analysis 2023-24
Upcoming changes in the ALB Landscape will see significant changes in the amount of grants disbursed by ALBs, as ESFA and NHS England will both be wound down, with their responsibilities moved into the remit of their sponsoring departments.
During 2023/24 ALBs issued around £267.92 Bn in grants. The total amount of grants-in-aid disbursed by ALBs was primarily driven by 3 ALBs. These were: NHS England (£177 Bn), Education and Skills Funding Agency (£72.06 Bn), and UK Research and Innovation (£8.47 Bn). Collectively these 3 ALBs spent £257.53 Bn billion as grants issued, which was around 96.1% of all grants-in-aid issued by ALBs.
The Cabinet Office and HM Treasury provide guidance to government departments and their ALBs on spending controls for the use of contingent labour. They define contingent labour as contractors, agency workers, and temps - who will often, but not always, be recruited to undertake work in a Business As Usual (BAU) environment. The contracts for contingent labour will generally pay on a time-based rate rather than delivery of an output or outcome, where there is a justifiable need identified by the organisation for contingent labour within their workforce plan.
In 2023/24, ALBs spent a total of £1.43 Bn on contingent labour staff, who supplement their primary workforces. Across all ALBs, on average, contingent labour spending made up around 0.6% of ALBs’ total expenditure.
Around 46.2% of all contingent labour spending by ALBs was attributable to the 5 ALBs who spent the most on contingent labour. Many of these ALBs are bodies which have large workforces, or are bodies which deliver public services that require employees with specific skill sets, which are often supported through the use of contingent labour. The ALBs who spent the most on contingent labour were:
The Cabinet Office also provides guidance to government departments and their ALBs on spending controls for the use of consultants. Consultants are defined as services that provide advice to fill a knowledge gap within an organisation. This can involve providing solution-oriented options and recommendations, typically to solve challenges during organisational change. The role of consultants is typically time-limited and focussed on outputs and solutions, and consultants are not typically classified as staff that operate within the structure of the organisation employing them. The UK Government recently announced new spending controls, aimed to cut consultancy spending, to save £1.2 billion by 2026.
In 2023/24, ALBs spent a total of £450.11 M on consultants. Across all ALBs, on average, consultancy spending made up around 0.03% of ALBs’ total expenditure.
Around 55% of all consultancy spending by ALBs was attributable to 5 ALBs. Many of these ALBs are bodies which are undergoing transformational change, carrying out high priority research, or are utilizing consultants to help formulate long-term strategies for innovation. For example, in their Annual Reports and Accounts (p10) the Environment Agency have highlighted one use of consultants (Jacobs and Manchester Metropolitan University) to help better understand how restored saltmarshes can be used for carbon capture, as a method of achieving Net Zero.
The ALBs who spent the most on consultants were:
To better understand how ALBs make use of contingent labour and consultants we carried out further statistical analyses, using linear regression models. We predicted that contingent labour costs would increase consistently relative to the size of the ALB, as measured by their workforce size. Our assumption was that larger ALBs with bigger workforces will have greater need for contingent labour, given they will likely use contingent labour to fill gaps in their workforce. We also predicted that consultancy spend would also be predicted by the size of an ALB, with larger ALBs being more likely to take on larger projects, which may require more support from consultants.
We found that ALBs’ spending on both contingent labour and consultants can be predicted by the size of an ALBs workforce: Larger ALBs are more likely to spend more money on both consultants and contingent labour. Interestingly, the relationship between spending and workforce size was stronger when analysing contingent labour spend, and weaker when analysing consultancy spend. This suggests that it is more difficult to predict consultancy spend depending on the size of an ALB’s workforce. Further analysis may help to identify further other predictors of these types of spending by ALBs. Details of these regression models can be found below.
Only includes ALBs with an FTE greater than 0, and Contingent Labour or Consultancy Spend greater than £0.
Cabinet Office | ALB Landscape Analysis 2023-24
term | estimate | std.error | statistic | p.value |
---|---|---|---|---|
Intercept (Baseline) | 3632800.520 | 1589759.6335 | 2.285126 | 0.0236794 |
Each Staff In Post (FTE) | 2179.448 | 189.0038 | 11.531240 | 0.0000000 |
Cabinet Office | ALB Landscape Analysis 2023-24
term | estimate | std.error | statistic | p.value |
---|---|---|---|---|
Intercept (Baseline) | 1739359.9583 | 854713.7140 | 2.035020 | 0.0435751 |
Each Staff In Post (FTE) | 456.2809 | 101.6155 | 4.490271 | 0.0000139 |
Cabinet Office | ALB Landscape Analysis 2023-24
The results of the linear regression analysis indicate a significant positive relationship between full-time equivalent (FTE) staffing and Contingent Labour spending. Specifically, for each additional FTE in post, as a measure of ALB size, we can expect an increase in Contingent Labour spending by approximately £2,179 (Estimate: £2,179, p-value: <0.0001). The intercept of the model is £3,632,801 suggesting that within this model when an ALB has no workforce, the Contingent Labour spending is estimated to be: £3,632,801. This indicates that there are likely other drivers for Contingent Labour spending that are not associated with workforce size.
The model explains approximately 46.5% of the variance in Contingent Labour spending, as denoted by the Multiple R-squared value. The Adjusted R-squared value is 46.15%, which provides a more accurate measure of goodness-of-fit for the model that accounts for the number of predictors involved. These values suggest that while the model captures a substantial amount of the variation in Contingent Labour spending, as explained by ALB workforce size, there are other significant factors not included in this model that may also influence spending.
The results of the linear regression analysis also indicate a significant positive relationship between full-time equivalent (FTE) staffing and Consultants spending. Specifically, for each additional FTE in post, as a measure of ALB size, we can expect an increase in Consultants spending by approximately £456 (Estimate: £456, p-value: <0.0001). The intercept of the model is £1,739,360 suggesting that within this model when an ALB has no workforce, the Consultants spending is estimated to be: £1,739,360. This indicates that there are likely other significant drivers for Consultants spending that are not associated with workforce size.
The model only explains around 11.64% of the variance in Consultants spending, as denoted by the Multiple R-squared value. The Adjusted R-squared value is 11.07%. These values imply that while the model identifies a relationship between ALB workforce size and Consultants spending, it may fail to account for other more significant variables that could affect Consultants spending.