F. Use external consultants where appropriate and ensure transitions between consultants are managed effectively

Some areas of expertise are best suited to the use of external advisors, such as specialised legal, financial, insurance and technical expertise. However, external advisors can be expensive and it will sometimes be more cost effective to hire permanent staff for those roles. The key to deciding between permanent staff or consultants is how regularly the relevant expertise will be used.

If legal advice is likely to be needed only for a renegotiation or a one-off dispute, then appointing external advisors to fulfil that function may be the appropriate approach. Where a payment mechanism is complicated, involving financial models that need to be understood by the Procuring Authority frequently, it will likely be more cost effective to hire permanent financial resources. Engagement of an independent certifier is common practice to assist the Procuring Authority to monitor the performance of the Project Company. The role of independent certifiers is detailed in Section 3.2 (Performance monitoring).

Continuity of external advisors avoids loss of knowledge and also minimises the administrative effort involved in any change. However, retaining external advisors on a long-term basis can also become an issue for ensuring competitiveness and demonstrating value for money in the procurement of such services. External advisors can provide some continuity of knowledge over the long term, particularly where government policies require public officers to move to different positions after a few years.

Value for money is more achievable when there is adequate competition among potential advisors. Government policies in several countries specify that advisory contracts must be re-tendered on a regular basis. Where this is not the case, the potential costs saving in competitively tendering external services should be balanced against the efficiency losses caused in the transferring of services from one external advisor to another.

Where the Procuring Authority is required to transition between advisors, continuity of knowledge is vital, and the contract management team should manage the advisors involved in a transition to ensure this process is efficient and that knowledge is effectively transferred from an outgoing advisor to the incoming advisor. This is best achieved when there is good understanding within the contract management team of the service being delivered by the advisors, so the appointments and transitions can be effectively managed.