Thomas Bridge 18 July 2014

Local audit plans could place ‘much greater burden’ on councils

Auditors have slammed plans to reform how parish councils are held to account, branding Government proposals overly ‘complex’.

In a letter sent to the Department for Communities and Local Government (DCLG) today, the Audit Commission urged ministers to rethink planned changes to local audit regulations for parish councils.

The watchdog said moves to force local bodies to appoint an auditor would raise costs and place ‘a much greater burden’ on town halls.

‘The Government wants high quality and cost-effective assurance that promotes transparency. It is trying to reduce the burden on authorities, but its proposals will do the opposite,’ Commission chair, Audit Jeremy Newman, said.

‘The Government needs to either keep the current assurance arrangements in place, or accept that the small spending levels of these bodies, coupled with their closeness to their communities, means that external audit is disproportionate.’

Measures due for introduction in April 2017 could end routine external checks for councils spending less than £25,000 a year. These bodies would instead be required to employ an auditor contactable by local residents who have questions or concerns.

Auditors said this would ‘inevitably’ cost these town halls more than current arrangements.

The Commission also described regulations making provision for all procurement possibilities as ‘close to impenetrable’.

Newman added: ‘The Government is seeking to reduce the burden by ending audit for many authorities, while keeping the right of all local tax payers to approach an auditor to challenge their authority’s spending. This has created complex regulations that are difficult to understand.’

A DCLG spokesman said: ‘The Government’s reforms give councils more freedom, improve transparency and accountability to local residents and will save taxpayers £1.2bn over 10 years.

‘We will respond to the consultation in due course as we continue to drive forward these important changes to ensure local appointment of auditors in 2017.’

A consultation on local audit regulations closed this morning.

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