A new report by the Public Accounts Committee has found “significant weaknesses” in the ability of local public bodies to secure value for money, with 18% of upper tier councils deemed to be without proper arrangements in place to do so.
The research into the auditing of local bodies published today found 18% of counties, unitary councils, metropolitan districts and London boroughs received in 2017-18 a ‘qualified’ opinion from auditors highlighting problems with accounts.
The PAC report examined auditing of public bodies including councils, police and fire bodies, and local NHS organisations. It found auditors had raised concerns at more than one in five of all bodies overall.
But auditors found problems with arrangements at 38% of NHS organisations such as clinical commissioning groups and hospital trusts.
The PAC said issues with arrangements for partnership working across public bodies was one of the biggest drivers of the increase in auditors reaching qualified opinions.
It added: “We heard from the local auditor of Ernst & Young that partnership working is becoming an even more complex area to audit, for example, where local NHS bodies and local authorities are working together to provide new models of care through sustainability transformation partnerships.”
However, the report said there are “limited consequences” for public bodies when auditor’s identify significant weakness and called central government departments to do more to hold local bodies to account for their performance and management arrangements. It also called for greater transparency, with some bodies not making all the information reported by the auditor readily available.
PAC chair Meg Hillier (Lab) said: “Taxpayers must be assured that their money is well-spent but in too many cases local bodies cannot properly safeguard value.
“Particularly concerning are NHS bodies such as Clinical Commissioning Groups and hospital trusts: last year almost two in five did not have adequate arrangements.”
“It is vital that local bodies take auditors’ concerns seriously, address them swiftly and ensure meaningful information on performance is made accessible to the public.”
In 2017–18, 495 councils, police and fire bodies were responsible for £54bn of net revenue spending, while NHS bodies received £100bn.
These bodies spent about £64m on external audit.