Gov. Gavin Newsom has paid upwards of $20 million to a consulting firm that employs his former cabinet secretary to eliminate wasteful spending — but the effort has come up well short of the goal as state lawmakers blasted the move.
Newsom — who signed an executive order to cut spending in the state, à la Elon Musk’s Department of Government Efficienc is hitting roadblocks with the plan amid a multibillion-dollar state budget deficit.
California contracted with one of the world’s largest consulting firms, Boston Consulting Group, for up to $20 million in an effort to cut $2 billion in spending from the departments of Corrections and Rehabilitation, Social Services, and Health Care Services by the 2028-’29 fiscal year.
But the group — which hired former Newsom cabinet Secretary and Department of Finance Director Ana J. Matosantos — is now expected to only find $810 million in savings, according to legislative analysts.
That number may even go down later in May, analysts added, as indicated by the Newsom administration.
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State lawmakers are scratching their heads over the miss.
“This whole Boston Consulting Group contract has me mystified,” Republican state Assemblymember Tom Lackey said during a Thursday legislative hearing, according to Politico.
“We were told that that’s what we were going to get, but we haven’t even come close to that,” he added.
Boston Consulting Group declined to comment, according to the outlet.
A spokesperson for the Department of Finance said in a statement that California is still “on course to achieve savings that are significantly greater than the cost of the contract.”
Democratic state Assemblymember Nick Schultz told Politico that questions about what the administration is doing with the contract is fair game for the public to scrutinize.
“At a time when time we might be asked to cut part of the social safety net back, I think everyone’s rightfully looking at saying, ‘What are we getting for $20 million?’”
