Parliament, whose job it is to hold the executive to account, is being asked to help set up the review, which is intended to examine the audit arrangements that date from Gladstone's day.
These have been increasingly called into question in the wake of devolution, European directives on audit, the government's development of public-private partnerships and the issue of how far private finance initiative projects should count on the government's balance sheet.
The study is bound to raise the suggestion of whether the National Audit Office, which covers central government, should be merged with the Audit Commission, which covers local government.
Mr Smith said: 'This is a great opportunity for parliament and government to work together to make sure transparency and accountability go hand in hand with the modernising government agenda.'
Press release from the treasury follows.
REVIEW OF CENTRAL GOVERNMENT AUDIT ARRANGEMENTS ANNOUNCED
An historic opportunity to look more widely at the whole question of
audit, access and performance validation across central government
was signalled yesterday by the chief secretary Andrew Smith as he
proposed that a study be set up to recommend suitable audit and
accountability arrangements for central government in the 21st
'This is a great opportunity for parliament and government to work
together to make sure transparency and accountability go hand in
hand with the modernising government agenda.'
In answer to a written parliamentary question he said that the proposed review will cover the modernising government agenda, audit/validation of performance measures, the implications of devolution, the wider European context, with particular reference to European Directives affecting audit arrangements, possible models from other countries and the relationship with other audit and regulatory bodies.
Mr Smith stressed that he was keenly aware of the importance of
parliament's rights in these matters. He recognised the need for its
interest in scrutiny, accountability and control of expenditure to be
reflected in the way the review was undertaken, including the
steering group for the study. The steering group will direct a
project board responsible for the delivery of the study and the
project board will have an independent chair.