Union says case for axing audit body yet to be made

Union says case for axing audit body yet to be made

Evidence presented to the Commons select committee hearing into the abolition of the Audit Commission echoes Prospect’s own warnings that closure will jeopardise independent scrutiny of local governments and the NHS, Prospect has said.

Suspicions that the move is driven more by a desire to “settle-scores” following a clash of personalities have been given further credence by the lack of any legislative vehicle to enact the closure proposals, says the union.

The comments follow yesterday’s hearing where David Heald, former Treasury adviser and Professor of Accountancy at Aberdeen University, David Walker, Guardian Public contributing editor and former Audit Commission communications director and Professor Steve Martin, director of the Centre for Local and Regional Government Research, gave evidence to the Communities and Local Government Select Committee.

Prospect negotiator Richard Hardy said: “Their findings mirror much of Prospect’s own submission, namely that abolishing the Audit Commission and the independent appointment of auditors will compromise the high standards of scrutiny required for local government.

“The Commission should continue as a public sector body or, at the very least, be turned into a mutual company employing former Commission staff. This would provide local government with a genuine choice in a market that is likely to be dominated by a handful of auditors.”

But Hardy said the case for abolition had still to be made, given that figures show the Commission could maintain its core functions and still save £75m – more than the £50m the government claims it will save through closure.

“Rather than detailed breakdowns of the projected cost savings of abolition being put in the public domain, we have spurious written questions about how much the Commission spends on office chairs. This is preventing any real discussion or challenge to the government’s claims,” he added.

“From the beginning we have said this decision is ill-thought out and ineptly handled. The struggle to find a suitable bill under which to rubber stamp the closure proposals confirms our fears. As with the regional development agencies, will the government be back in six months with proposals to reinstate the audit function?”

Hardy said members are sceptical that ministers were provided with all the relevant facts before the decision to close the Commission was taken.

In the latest evidence session, held on February 7, Professor Heald said the “brutal” abolition of the Commission “creates suspicions of score-settling and lobbying”.

Heald also said the appointment of auditors needs to be independent not only of the local authority or health body being audited, but from government and politicians “who will pursue private interests as well as advance the public interest”.For copies of the union’s submission please visit https://library.prospect.org.uk/id/2011/00156