The Audit Commission has unveiled plans to cut inspection fees by up to 20% for 2010-11, despite previous concerns such a move would be scuppered by its abolition.
The watchdog, which said a 20% cut would save public bodies a further £11.8m, outlined the proposals in a consultation.
The cut would be in addition to a previously agreed £12.8m of rebates and waived inspection charges. It would mean inspected bodies’ audit costs would be reduced by £24.6m next year.
The doomed quango said the move followed the Department for Communities & Local Government agreeing that the “significant transitional costs associated with [the body’s] abolition…should not fall on audit fees”.
The news follows minutes from the Commission’s September board meeting revealing concerns the previously mooted cut would have to be ditched.
A cut in audit fees of between 2% and 20% had been planned, but due to the commission’s statutory duty to break even, the fees would “need to be set at a level that not only met the costs of audits and inspections, but also all the other costs in that financial year”, the minutes said.
The Audit Commission Board has also decided to return some of the audit fees already collected for work carried out this year on Use of Resources. This work was suspended immediately the government announced in May 2010 that it would abolish Comprehensive Area Assessment.
Rebates will be sent to audited and inspected bodies shortly with a 1.5% rebate for district councils, police, and fire and rescue authorities and a 3.5% rebate for single-tier and county councils.
Audit Commission chairman Michael O’Higgins, said: ‘For 2011-12 [the Commission] will take each audited body’s 2010-11 fee and reduce it by the proposed cuts. This will result in savings for audited bodies while allowing the Commission to wind down its business in an orderly manner.”