NYC Pays 230 “Consultants” $722M/yr for failed project while laying off workers

[Hannah Bell]

In a cover story for the New York Daily News, Democracy Now! co-host Juan Gonzalez reports New York City is “paying some 230 ‘consultants’ an average salary of $400,000 a year for a computer project that is seven years behind schedule and vastly over budget.



JUAN GONZALEZ: Yes. It’s about a—well, you could call New York’s version of Boston’s Big Dig, only it’s in cyberspace, that the city has been—is spending now up to more than $722 million, ten times what it originally started to spend, to create a new computerized payroll system. This is happening all around the country, as cities are increasingly going to computerization of government services. The only problem is that this project is seven years behind schedule, ten times the cost, and the city is paying over 200 computer consultants an average pay right now of $400,000 a year—


AMY GOODMAN: Each?


JUAN GONZALEZ: Each, including eleven of them that I found in city records through a FOIA who are being paid over $600,000 a year—$670, $650, $630—all to design a system that is far from complete and is only covering about a third of the city workers. It’s a payroll system where they were going to have workers, for instance, punch in with biometric hand scanners when they come in in the morning, at lunchtime, to supposedly to avoid city workers punching in for other workers and, in essence, stealing time.


AMY GOODMAN: Your hand goes in.


JUAN GONZALEZ: Yes, you have to put your hand into a biometric reader, which reads your palm print, and it says that you are the person that is punching in for work that day, but also using computers. When you log into your computer, it punches you in for work that day. But it is a vast timekeeping and payroll system that is now verging on a billion dollars in cost and is not complete after ten years. But this is happening all around the country, as more and more governments are going to computerization. The costs that are being spent on these consultants, these private consultants, dwarf any kind of city salaries that ordinary workers are being paid.


AMY GOODMAN: And what is Mayor Bloomberg saying about it?


JUAN GONZALEZ: Well, Mayor Bloomberg admitted three weeks ago, after several other articles that I wrote, that it’s a disaster. Yet he just approved another $139 million to be spent on these salaries. The problem is no one knew how much these people were being paid, because their salaries don’t appear in normal city records. It’s a capital expenditure, so you have to really dig into the contracts to find out what these people are being paid.


AMY GOODMAN: Well, it’s nice to know cities aren’t strapped, that they have plenty of money to spend in their budgets.


JUAN GONZALEZ: Oh, yeah. Well, the city just laid off 500 public school aides who make $18,000 a year, while they’re paying all these people that are making $400,000 and $500,000 a year for a failed system.


http://www.democracynow.org/2010/3/26/juan_gonzalez_ny_pays_230_consultants

http://www.nydailynews.com/news/2010/03/26/2010-03-26_city_pours_722m_down_consulting_contracts_black_hole.html

[Jim Sagle]

1. It's not incompetence, as I suspect you'll agree.

Comforting the comfortable and afflicting the affflicted is what they do.

[Hannah Bell]

2. no, not incompetence. corruption.

[rucky]

3. This may be a rare case where outsourcing may have been a better option.

Couldn't they have awarded a contract for this ? It's not like computerized payroll is a new thing. There are companies here who've been doing it right for years.

[Hannah Bell]

4. it *was* outsourced. that's why they're paying *consultants*.

[rucky]

7. consultants don't actually do the work though.

If I were the consultant I would've called ADP and have been done with it. Easiest 400K evah!

[Hannah Bell]

8. *Two hundred* "consultants.

[bullwinkle428]

5. "Consultant" is the 21st century term for "Con Man"!

[izzybeans]

6. Every job I've ever had I had to deal with wasteful consultants who couldn't do the work

they were hired for but had special relationships to either my direct supervisor or the executives of the org. I worked for.

The team I work on spends a good deal of our time pitching our services internally and trying to demonstrate the vast amounts of waste that goes into consultants.

In house is always cheaper. Always. Its very rare to not have the talent you need to pull it off yourself as a team. Most of the time the execs were more concerned about paying off their pals than asking their workers if any of us could do the job. Instead we pay them double our hourly rate to do work that we have to fix on the back end. Every time we hire a consultant, the result is the same. So those numbers are not surprising.

I could see a company hiring an outside IT consultancy if they didn't have an IT department. But NYC has IT people in its city government.