That's true but it doesn't work out. There are around 252 working days in a year. Lets take off 30 days for holiday. That leaves 222 days.
A Band 8a tops out at about £61k with full London weighting.
A contractor working on an IT project in a senior role at 8a sort of level is currently being offered around £500 a day. That's £116k but of course that doesn't include the agencies 20%, so we need to add on £23,200. The contractor because of IR35 isn't going to go direct, they will be employed by a project which will probably include at least a 20% profit margin on the staff. So without doing all the complex maths lets call it another 20%.
That IT Contractor is now costing (per annum) £162,400 of which almost £50k is going to the companies rather than the contractor. It's also three times that £61k salary and any learning or knowledge leaves at the end of the project.
To me, that doesn't feel like value for money. Of course if you offered an 8d the contractor might go employed (or even an 8b), but that's one or two bands below the COO and CEO type roles. Not a standard senior rank and file role.
And bear in mind that that £500 a day rate is what I'm currently hearing offered for NHS work, not private sector - expect at least £750 private sector, double if it's banking. I've settled for the reliability of employment elsewhere and once you take off taxes and overheads you don't earn the full £116k - a lot of that goes back to HM Gov, so an 8b to 8d would be enough to recruit similar talent.
But the fact remains, it is not cheaper to pay for IT through a Project.
