Unison are calling for an inquiry into the propriety of arrangements by
the big five accountancy firms involved in more than£54bn worth of PFI projects.
at the apparent conflict of interest in which the same firm acts as financial
advisor on a public sector project and auditor of at least one consortium
member bidding for the project.
The 'big five' accountancy firms are Pricewaterhouse Coopers, Anderson Worldwide,
KPMG, Ernst and Young and Deloitte Touche Tohmatsu.
The report points out that these firms have been driving government policy
developments on privatisation as secondees to government departments, developing
value for money tests used for PFI projects, and producing key reports which
the government has relied on to defend PFI and PPPs.
According to Unison, public concern is mounting at the potential conflicts
of interest surrounding the different roles taken on by these firms.
Currently, the Greater London Authority is contemplating legal action against
the London Underground PPP because PWC, which evaluated the deal, and Ernst
and Young who did the value for money calculations, are auditors to five
of the eight private bidders set to profit from the contract.
Dave Prentis, Unison general secretary said: 'These companies are running
the government's privatisation agenda and charge massive fees as advisors
and auditors. There must be a huge question mark over the independence and
impartiality of the advice these firms are giving in PFI and PPP.'
He added: 'You need look no further than Arthur Anderson to see the dangers
if an accounting firm acting as both auditors and management consultants.'
The report concludes: 'There is an urgent need for an inquiry to establish
the full extent of the problem and to produce remedies that meet the grave
concerns raised in this report.'