Below are a pair of excellent excerpts from recently released reports. Both are well worth reading in full.
"The folly of skimping on internal core competence is well established in many domains. One paper by Zachary Liscow of Yale finds a remarkable correlation between the staffing levels of state departments of transportation and the per-mile construction cost of highways: increasing employment by one person per thousand in a population reduces costs by 26 percent.28 When there is insufficient staff to manage these projects, their work is outsourced to consultants who often lack the continuity, context, or incentives to perform the work properly. There is ample evidence across a wide variety of government functions that contractors cost more than government staff for the same work, and that outsourcing at those higher rates causes the very people the government has trained and invested in to leave for higher-paying jobs in the private sector.29 In 2011, Former CIA Assistant Director Mark Lowenthal told Congress, “It’s the least experienced analytical staff since 1947, and this demographic trend will play out in years to come,” regarding the brain drain to the private sector."
From The how we need now: a capacity agenda for 2025
"What accounts for the difference in construction cost per kilometre? The most important difference between models is in their use of in-house expertise. Metro projects in English-speaking countries don’t tend to employ experts directly. Instead of employing experts directly, they hire consultants to manage the project on their behalf.
In European (and East Asian) countries, by contrast, the state employs its own corps of experienced technical staff. This subtle difference in the employment terms of a few dozen project leaders has big consequences for the efficient delivery of the project."
From the Progress Ireland Institute
