Just one in three Whitehall contracts use open-book accounting

2 Jul 15

Open-book accounting data is currently only available in a third of government contracts, a National Audit Office survey has revealed.

The survey was included in a report issued on July 1 in which the public spending watchdog urged the government to negotiate better access to information about suppliers’ costs and profits.

Government staff need a detailed understanding of what is going on in organisations contracted to deliver public services, the NAO argued.

“Contract management is not a desk job. We are reminded of this in all the best practice and the worst failures we see,” said NAO head Amyas Morse.

“For government to be accountable for contracted out public services; for it to understand its suppliers; for it to exercise oversight: and for it to promote value for money, it requires its contract managers to take a ‘hands-on’ approach and to go and see for themselves what their suppliers are doing.”

Informed by public and private sector case studies, the NAO has issued five approaches to collecting and using information of suppliers. These are:

  • ensuring price complies with the contract
  • making better informed commercial decisions
  • assuring processes
  • maintaining control of risk
  • achieving step-change innovation

 

The auditors want to see every government department adopt a policy on when to use open-book accounting. The Cabinet Office has also been urged to set up a taskforce to develop a common standard for open-book data as well as improved guidance on how to interpret suppliers’ costs.

  • Vivienne Russell

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

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