By Alex Klaushofer
17 July 2009
The Department for Communities and Local Government has difficulty in making urgent investment decisions, a report from the National Audit Office has found.
The NAO report on Financial management in the Department for Communities and Local Government, published on July 17, said that it could take six weeks for proposals to be approved by the department’s investment board.
After the floods of 2007, the department had paid out most of its available funds for flood recovery grants before formal approval had been given, the report found.
It also concluded that the DCLG, which has a budget of £34bn a year, needed to do more to embed good financial management in the department and improve the financial skills of its staff.
As a result, the department had difficulty in reporting expenditure against objectives, making it hard to understand the impact of funding decisions on performance, the report said.
Auditor general Amyas Morse said the department was making improvements. But he added: ‘It has more to do. As a priority, it must identify and understand the gaps in its financial and business management skills and set about filling them.’
Public Accounts Committee chair Edward Leigh said: ‘The NAO has found that good financial management is not as common as it needs to be in the department.’
He added that only 28% of the department’s finance staff were professionally qualified.
