Governor Newsom Allocates $20M for Consultants in Innovative Plan Inspired by DOGE

In a bid to tackle wasteful government spending, Governor Gavin Newsom has engaged a consulting firm, which includes his former cabinet secretary, at a cost exceeding $20 million. However, this initiative has faced significant backlash from state lawmakers, as it has fallen short of its ambitious objectives.

Governor Newsom had envisioned this effort, echoing a streamlined approach similar to Elon Musk’s Department of Government Efficiency, as part of an executive order aimed at curbing state expenditures. This comes at a time when California grapples with a substantial multibillion-dollar budget deficit, adding pressure to the administration’s fiscal strategies.

The state enlisted the expertise of Boston Consulting Group, a globally renowned consulting firm, to identify and implement $2 billion in spending cuts across key departments, including Corrections and Rehabilitation, Social Services, and Health Care Services, by the fiscal year 2028-2029.

However, legislative analysts have reported that the anticipated savings have been significantly downgraded. The consultants are now projected to achieve only $810 million in savings, a figure that might be further reduced as new assessments are released in May, according to signals from the Newsom administration.

This shortfall has intensified scrutiny over the effectiveness of the contract and the administration’s broader fiscal management strategies.

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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?’”