Audit Commission calls for outsourced audit deals to last to 2020

13 Oct 14

Local government and NHS bodies could save as much as £440m if Whitehall extends Audit Commission contracts for local auditor services to 2020, the watchdog has said.

The commission, which is due to be abolished next March, said it was reducing audit fees for local public bodies by £30m from 2015 to 2017, following its retendering in March 2014 of the work done under its older contracts.

This was in addition to the 40% cut in fees made by the commission in 2012 when its in-house audit work was outsourced.

Audited bodies would save £440m over the 2012-20 period were the government to extend both the 2012 and 2014 contracts to 2020, it said.

Commission chair Jeremy Newman said: ‘We have driven down prices for audit services, showing again that bulk procurement is the best way to maintain a competitive market and provide taxpayers with value for money.

‘The resulting savings are part of the legacy the commission will leave after March 2015, and will be enjoyed by local authorities and NHS bodies for years after our closure.

Fees should be preserved at this level for 2016-17 and we hope the government will take the opportunity we have secured, to lock in and extend the savings we have achieved up to 2020.’

Once the commission closes, a company formed by theLocal Government Association will oversee the outsourced contracts.

Audited bodies are also to share £6m in rebates from the commission, which it said represented savings made through &lsquoefficient management of [our] closure’.

This is in addition to the £8m rebated last March, and any remaining surplus will be returned to audited bodies in March 201

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