Tory councils discuss life after the Audit Commission

18 Aug 10
High-profile Tory-led local authorities have begun drawing up plans for a world without the Audit Commission, Public Finance has learnt.

By Jaimie Kaffash

18 August 2010

High-profile Tory-led local authorities have begun drawing up plans for a world without the Audit Commission, Public Finance has learnt.

Communities Secretary Eric Pickles announced the abolition of the commission last week. Senior Conservative council leaders have backed the decision, calling it a ‘triumph’ for localism.

Surrey County Council leader David Hodge told PF that his council ‘is in discussions with colleagues from another county council and we are already looking to draw up our own terms and conditions about where we want audit to go’.

He added: ‘We can get the job done to the same level or better at a lower cost to the taxpayer but also making sure we do not lose sight of the governance issues around public money.

‘Ourselves and Kent have a view that it is important we do not lose the quality of audit. It does not necessarily need a long drawn out process to achieve this.’

Lynne Hillan, leader of the London Borough of Barnet, told PF: ‘It could be that a lot of London councils will be getting together to commission auditing. We would be able to commission at a very good price. We are waiting to hear what will happen. We have had initial talks about where we want to go. ‘

Stephen Greenhalgh, leader of the London Borough of Hammersmith & Fulham said that he expects his council to save £200,000 from the abolition through cheaper audit fees and ‘office time spent satisfying the commission’. 

He added that the value-for-money studies undertaken by the commission could be done through other bodies, such as the Local Government Association, a view shared by Hillan in Barnet.

Hodge said that the National Audit Office could oversee the national strategy for local authorities: ‘It is the role of the National Audit Office to disseminate examples of good practice nationwide. Its role is to look at the bigger picture. We have already held meetings about what life will be like after the Audit Commission has gone.

‘As long as the NAO remains, it can develop the overall strategy. Councils need the assistance of the NAO. Why do you need two different organisations to oversee the bigger picture?’

However, experts – including local government select committee chair Clive Betts – have warned that it would be difficult to replicate the value-for-money work done by the Audit Commission. 

On his PF blog, Tony Travers said that the commission’s reports were invaluable: ‘The Audit Commission managed to mediate between central and local government on a number of issues. National studies allowed the commission to publish reports that showed how central government often behaved in ways that impeded local efficiency and effectiveness. 

‘Latterly, there were wise reports showing how, for example, in spheres such as regeneration the government had created such a plethora of institutions, grants and initiatives that it was almost impossible to make sense of them.’

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