KPMG and EY Secure Up to £456m UK Civil Servants Training Contract
KPMG and EY will provide training to UK civil servants in AI and other skills under a contract worth up to £456m.
The UK Government has awarded consultancy companies KPMG and EY a contract worth up to £456m to train civil servants in artificial intelligence (AI) and other skills between 2026 and 2028.
The deal was reported by the Financial Times (FT), citing data from government procurement tracker Tussell.
Under the agreement, KPMG and EY will provide training across various skills areas, including AI, during the three-year period.
The deal is reported to be the largest single contract awarded to ‘Big Four’ companies since Tussell began tracking government procurement records in 2012.
The previous record was a £322m contract between the Foreign Office and PricewaterhouseCoopers, signed in 2012.
KPMG and EY Contract Shares
KPMG’s share of the contract is capped at £319m, representing almost a quarter of the company’s total UK advisory net sales from last year.
EY’s portion is worth £137m, equivalent to around 13% of its UK consulting revenue over the same period.
When approached by International Accounting Bulletin, EY declined to comment on the contract award.
The new KPMG-EY agreement will replace an existing civil service training arrangement that was due to expire.
However, the £456m figure represents the maximum value of the contract rather than guaranteed government spending. The government is not required to use the full amount.
Contract Award Comes Despite Consultancy Spending Pledge
The contract was awarded despite a government pledge made in 2024 to halve consultancy spending, according to the FT.
The pledge was intended to save taxpayers more than £1.2bn by 2026. Under the measures, civil servants were told that major new consultancy contracts would require approval from either a cabinet minister or a department’s senior official.
Tussell figures show that Big Four companies have already secured £1.25bn in government contracts this year. That exceeds the £1.06bn recorded for the whole of last year.
A Cabinet Office spokesperson told the publication that the government remains committed to halving consultancy spending, with £700m in annual savings expected by 2028/29.
The spokesperson added that the newly awarded contract covers training services rather than consultancy work. The arrangement will be phased out once the government's in-house training model is in place.
Key Takeaways
- KPMG and EY have secured a UK Government training contract worth up to £456m.
- KPMG’s share is capped at £319m, while EY’s portion is worth £137m.
- The firms will train civil servants in AI and other skills between 2026 and 2028.
- Big Four companies have secured £1.25bn in UK Government contracts this year, compared with £1.06bn for the whole of last year.
- The government says the agreement covers training services rather than consultancy and will eventually be phased out when its in-house training model is established.
Conclusion
The KPMG-EY agreement represents a major government training contract at a time when the UK Government is pursuing a broader reduction in consultancy spending. While the contract has a maximum value of £456m, actual government spending is not guaranteed to reach that ceiling. The Cabinet Office maintains that the agreement relates to training services and will eventually transition to the government's in-house training model.