MPs have called for urgent action over an 'unacceptably high' backlog of auditing of local government accounts.

A report by the House of Commons public accounts committee says only 12% of local government bodies received audits on their finances in time to publish accounts for 2021-22.

The committee's chair Dame Meg Hillier said it had warned two years ago that the system of local government audit was 'close to breaking point', but the situation has 'only gotten worse'.

She said the cases of several crisis-hit councils, Croydon, Slough, Thurrock and Woking should serve as 'flashing red signals for the Government'.

Ms Hillier said the committee's report warned 'the rot risks spreading to central government finance and the NHS.'

The committee says the delays, representing £100bn of spending, increases the risk of governance or financial issues being identified too late.

More than 400 local government bodies missed the already extended deadline, with the cumulative backlog of unpublished opinions rising to 632 for 2021-22.

The report calls for the proposed new regulator, the Audit, Reporting and Governance Authority, to be established but says there are 'still few signs of it happening'.

It also urges the Government and the Financial Reporting Council to set out how they will tackle the long-standing challenges in building capacity, capability and leadership in local audit.

Ms Hillier said: 'The Government must get its hands round this problem as a matter of urgency.

'It’s local taxpayers and service users who lose out when serious financial issues arise.

'The lack of timely accounts leaves council tax payers in the dark'.