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Row over financial reporting

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Attempts to ease the financial reporting burdens on councils have sparked a fall-out between central and local government.

Local government minister John Healey issued an instant rejection to a number of proposals from a report from the Lifting the Burdens Taskforce last week, claiming “some burdensome processes are needed for proper financial management”.

But the Local Government Association took umbrage at the manner of the rejection with director of policy and performance Stephen Jones saying it would lead to “real problems” between the organisations.

The report, Review of Financial Management Burdens, made 27 recommendations relating to private finance initiatives projects; delivering value for money; financial reporting to central government and councils’ dealings with HM Revenue & Customs.

Some burdens 'necessary'

While most were welcomed by Mr Healey, he insisted some burdens were necessary.

“The proposal to merge certain data returns doesn’t sufficiently take into account the reasons for those returns,” Mr Healey said in a hastily released press notice.

“And the recommendations on PFI don’t take fully into account the fact that PFI projects vary significantly. To accept those recommendations in full would result in an unacceptable restriction of the government’s role in ensuring value for money for the taxpayer.”

The press notice prompted a testy reaction from Mr Jones. “It would be good if the department were equally quick at accepting some recommendations,” he said. “We’d like to move toward dialogue rather than dismissal.

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