The Department for Education and Skills' own auditors have condemned it for paying consultants up to pound;1,000 a day from money that should have gone to schools and other frontline services, a union has claimed.
The Public and Commercial Services union has seen information related to an internal audit which shows that the department spent between pound;35 million and pound;40m on consultants during the first quarter of 2004-05.
The union, which represents most of the civil servants at the department, said the DfES has been severely criticised by its auditors for inappropriate use of public money.
PCS said the auditors found the department had used programme budgets - money meant to be used for initiatives and policies rather than running costs - to pay for consultants.
In a number of cases this was condemned as an inappropriate use of public funds. The auditors also criticised the DfES for not having proper controls or tendering procedures in place when hiring or re-hiring the consultants, the union said.
Marion Lloyd, vice-president of the union at the DfES, said figures obtained by PCS showed that only pound;3.2m of the running-costs budget had been spent on consultants in an entire year. This suggested that most of the pound;35-40m identified by the auditors had been taken from programme budgets.
She said the tactic is becoming increasingly common practice as the department cuts back on its permanent staff. "I know of instances in which managers struggling to deliver a programme due to lack of staff have been advised that they can use some of their programme budget to take on consultants," she said.
"There has always been a role for consultants to provide expert advice, but increasingly we find that they are being employed to do jobs that civil servants could do for a fraction of the cost."
The DfES could not give figures for the number of consultants it used but PCS believes it has risen in recent years, as shown by the fact that DfES auditors have investigated the issue.
The union is campaigning against plans announced by Chancellor Gordon Brown last year to cut 1,460 posts - nearly a third of DfES staff - by 2008. It says the cuts will put delivery of the Government's five-year strategy at risk and public money into the pockets of private consultants.
A DfES spokesman said: "The five-year strategy made it clear that our ambition is for a smaller, more strategic department with a deeper knowledge of the needs of individuals and employers and of how the systems for children's services, education and skills work at local level.
"Consultancy costs include payments to specialist advisers, current and former teachers and heads who are helping the department to develop and implement policies that meet the needs of the education sector."