The firms that design Scotland cheated on their ethics exams
All four of the “Big Four” consultancy firms - KPMG, PwC, EY and Deloitte - have been fined in the Netherlands by US regulators after it was found that “hundreds” of their staff were cheating on ethics exams and other regulatory training exercises and professional requirements with staff found to have been regularly collaborating and sharing answers during an investigation running between 2018 and 2022.
These are firms that the Scottish Government have frequently used to design policies despite other scandals surrounding the firms. Last year, Common Weal uncovered - following our own two year investigation and after attempts by the Scottish Government to block our access to information under Freedom of Information - that the award for the design of the ill-fated National Care Service was given to KPMG even after the Government was warned to not engage with them following advice that “the entire firm was dishonest”.
As we mentioned in last week’s magazine article “Scotland’s Not For Sale, Part I”, PwC has also earned money from the design of aspects of the National Care Service. Deloitte won a £9 million contract related to the IT services behind Scotland’s social security systems and EY have earned at least £6 million from the Scottish Government in contracts related to CalMac. EY were also related celebrated by the Scottish Government for their report stating that Scotland was the second favourite region of the UK (outwith London) for foreign direct investors - that report didn’t, of course, mention the fact that foreign direct investment is the reason that Scotland has one of the highest rates of outwards profit extraction not just in Europe but in the entire world. These are just the latest in a series of fines these companies have been charged since the UK Financial Reporting Authority stated in 2019 that the companies should be replaced “as soon as possible”.
Many of the contracts mentioned above occurred during the period where we now know that these companies were cheating on regulatory and ethics exams. This raises serious questions about the soundness of the policies they produced during this time and about the Government’s willingness to use them and to keep using them.
In our handbook for a better Scotland, Sorted, we call for an end to reliance on corporate firms with no democratic oversight for policy-making. Instead, the Scottish Parliament should set up a Civic Forum comprised of working groups of Subject Forums (each similar to Common Weal’s own Expert Working Groups or the Scottish Government’s Expert Advisory Groups) who can develop policy ideas and submit them to Parliament and the civil service for further scrutiny and development. It would be a statutory duty for the Parliament and especially the Government to submit its own policy ideas to the Forum and all of these bodies would be subject to oversight by a national Citizens’ Assembly. The use of corporate firms to develop policy - especially those found to be “entirely dishonest” and to have cheated on their ethics exams - would be banned.
