Melchett et al - not uncommon in the civvie world - get someone retiring with a Service pension and pay them a lower than market rate salary - called "economics"
A fair point, and I agree completely wrt to economic reality. However, if you are failing to attract the calibre of person you require, or those with the relevant qualifications or experience then the project is ultimately doomed to failure.
If you asked a builder to project manage the building of your house, how would you feel if he pocketed 50% and then said 'we can't actually get any tradesmen, but Ive got all the materials for you'? or 'A qualified electrician was too expensive, so I've employed the milkman to do the wiring and electrics?
I agree, anyone bidding on a project has to be competitive, but they also have to deliver.