PAC slams Cabinet Office for sloppy sale of public agencies

13 May 99
The Cabinet Office seriously breached parliamentary accountability when it failed to meet statutory financial deadlines following the privatisation of three government agencies in 1996, according to a report from the Public Accounts Committee.

14 May 1999

Publishing its 13th report on the final accounts of Chessington Computer Centre, Recruitment and Assessment Services and the Occupational Health and Safety Agency, the PAC criticised the approach of the Cabinet Office during the sale of the agencies as 'sloppy and dilatory'.

The delays in preparing financial accounts for the three agencies, which are still outstanding more than two years later, were caused by weak accounting systems and poor records of assets, increasing the risk of losses to the Exchequer, the report said.

Chessington Computer Centre, which provided a computerised service for payroll, personnel, financial accounting and other administrative services to central government, was sold for £12.5m; Recruitment and Assessment Services, which provided recruitment and personnel services to government departments was sold for £7.25m, and the Occupational Health and Safety Agency, which provided advice and services to government departments on occupational health matters was sold for £350,000.

Accusing the Cabinet Office of negligence, PAC chairman David Davis said: 'There have been extra costs to the taxpayer arising from the department's failure to properly manage the sale, and this is unacceptable.'

The committee has called on the Treasury to implement and police the deadlines imposed by statute: 'In the private sector, failure to file accounts on time would lead to fines and penalties. We look to the Treasury to emphasise that submitting accounts beyond the deadline is unacceptable.'

A Cabinet Office spokesman said the government's response would be published later. He added: 'It would not be appropriate to comment at this stage on the recommendations of the PAC, which were the responsibility of the previous administration. The government's considered response will be provided in due course.'


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