Whole of Government Accounts for 2012/13 qualified

11 Jun 14

The National Audit Office has qualified the Whole of Government Accounts for the fourth successive year because of concerns with the quality and consistency of data.

Comptroller and auditor general Amyas Morse again expressed concern that bodies such as Network Rail and further education institutions continue to be excluded from the accounts, even though accounting standards require them to be included.

But he said that, if the Treasury was successful in its plans to address the issues that have led him to qualify his opinion, he might be able to remove a number of qualifications in the next four years.

The WGA were laid before Parliament yesterday, a month earlier than last year's set. However, compared to the first set of accounts, for 2009/10, publication has been brought forward by five months. For the 2014/15 WGA, the Treasury aims to deliver them just nine months after year-end.

Morse said: ‘I welcome the Treasury’s continuing commitment to improving WGA in terms of its timeliness and content. The Treasury is taking steps to make the disclosures in WGA more detailed and transparent, giving the reader more information about how government spends taxpayers’ money.’

He said they were beginning to show some emerging, long-term risks to the balance sheet, such as movements in nuclear decommissioning and clinical negligence provisions. This would help the Treasury manage the public finances better.

However, more could be done to exploit the WGA’s potential as a reporting mechanism, he added.

‘The Treasury should continue its work to strengthen the WGA so that I will be able to remove my qualifications.

‘The Treasury should also raise the profile of WGA within government and make the information it provides integral to the routine monitoring of risks to public finances.’

The latest set of accounts show the in-year shortfall between income and expenditure decreased from £185bn to £179bn, largely owing to falls in the government’s cost of borrowing and increases in revenue.

Direct expenditure on the delivery of the government’s policies increased by £18bn in 2011/12 to £666bn. This increase was due to increases in the purchases of goods and services and in provision expense.

Overall net liability (the difference between what it owes and what it owns) increased in 2012/13 by £283bn to £1,630bn. This was largely down to a £169bn increase in public sector pension liabilities and a £31bn increase to government borrowing in the form of issuing gilts to finance government spending.

Responding to the publication, CIPFA chief executive Rob Whiteman said: ‘The government’s commitment to, and investment in, Whole of Government Accounts is commendable and the UK remains one of the world leaders in governmental financial reporting.

‘Considering the current pressure on public resources we need to make sure that we use this detailed information to effectively manage public money and continue to deliver world class public services.’

He called on the government to help fully realise the potential benefits of WGA in the running of government and use them to inform policy making and assist in medium term financial management.

‘CIPFA also hopes that the Treasury will start to lead the way in this by using WGA in the presentation of fiscal events such as the budget and the autumn statement, including by reporting outturn against budget for the whole public sector, and publishing forward balance sheet forecasts.’

  • Vivienne Russell

    Vivienne Russell is managing editor of Public Finance magazine and publicfinance.co.uk

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