11 June 1999
The House Of Commons Public Accounts Committee this week castigated National Savings for failing to keep proper control of its investors' money and to meet deadlines for explaining the losses.
The agency missed its deadline for investigating its financial problems by 11 months, after the PAC concluded in an earlier report, in 1997, that the number and size of financial discrepancies and unreconciled balances in its accounts were unacceptable.
Now the committee comments: 'The net shortfall of £4.6m in assets to meet the Exchequer's liability to investors gives a deceptively small impression of the scale of National Savings' problems.
'The £4.6m comprises approximately £40m of positive adjustments and £44m of negative adjustments, a total gross error of £84m. The agency must ensure that errors of this magnitude do not recur.'
It adds: 'Whether fraud was a contributory factor in the discrepancies is a question never likely to be wholly answered.'
PAC chairman David Davis said: 'National Savings' investors have a right to expect that their money is protected from financial inadequacy.
'It is only by using taxpayers' money to investigate the problems and make up the shortfall that investors have not lost out so far.'
PFjun1999
