- EY and KPMG could receive up to £456 million for civil service training.
- KPMG will receive up to £319 million, while EY will get up to £137 million.
- The contracts come as Labour works to rebuild the National School of Government.
Why is the government paying private accountancy firms hundreds of millions of pounds to train its own civil servants?
That is the question raised by a new £456 million government contract awarded to EY and KPMG, less than two years after Labour pledged to halve spending on external consultants.
The two Big Four firms will provide ad-hoc learning and training services to civil servants between September 2026 and March 2028. The arrangement is intended to cover departments while the government rebuilds its National School of Government.
KPMG has been awarded up to £319 million, while EY could receive up to £137 million.
The size of the deal makes it notable. According to government contracts analytics group Tussell, it is the largest single contract awarded by the Cabinet Office to a Big Four firm since its records began in 2012.
A temporary fix with a very large price tag
The government says the spending is part of a transition rather than a change of direction.
The National School of Government, which officials expect eventually to reduce the need for external training contracts, is being relaunched this year. But it is expected to take three years to reach full capacity.
Until then, individual government departments will be able to approach EY and KPMG when they need training. This could include programmes focused on artificial intelligence skills and other areas of civil service development.
The Cabinet Office said the government was still making “real progress in cutting external spending” and remained committed to halving consultancy spending.
A spokesman reportedly said the government was moving away from outsourced contracts and that the new in-house model would reduce reliance on external spending and provide better value for taxpayers.
The government also wants more than half of the money spent on training to go to smaller businesses rather than large corporations.
But the scale of the latest contract is likely to attract attention because of Labour's previous pledge.
Consultancy spending surged during the pandemic, reaching record levels. Labour promised in 2024 to halve spending on consultants as part of its efforts to reduce the cost of running government.
The new contracts therefore create an awkward question: if the government is trying to bring more work in-house, why does the transition require up to £456 million from two of the country's biggest accountancy firms?
EY and KPMG are not alone in the government’s spending
The latest deal also comes against a wider rise in government contracts awarded to the Big Four.
Tussell data shows EY, KPMG, PwC and Deloitte have secured £1.25 billion in government contracts so far in 2026. That has already surpassed the £1.06 billion awarded to the firms during the whole of 2025.
The figure remains below the peak seen in 2020, when Big Four firms won just over £1.7 billion worth of public sector contracts.
KPMG's relationship with government has also had a complicated history. The firm voluntarily stopped bidding for lucrative government contracts for much of 2021 and 2022 while facing scrutiny over several scandals, including its work involving collapsed construction group Carillion and mattress maker Silentnight.
The Cabinet Office had previously considered banning KPMG from bidding for government contracts before the firm stepped away voluntarily.
The latest arrangement is therefore part of a much bigger question about how much work the government should buy from outside companies and how quickly it can build the internal capacity to do more itself.
For now, the government appears to be paying for an external solution while it rebuilds an internal one. Whether that proves cheaper in the long run will depend on how quickly the National School of Government reaches the capacity officials expect.
