A new local government audit body should be created and ministers should change the way they judge the financial stability of councils, a review of local government audit has found.
The Redmond review suggests strengthening audit with a new regulator but says it would be ‘small and focused’ and not a recreation of the Audit Commission.
Former CIPFA president Sir Tony Redmond called for an Office of Local Audit and Regulation (OLAR) to manage, oversee and regulate audit, including the procurement of audit for the sector.
Sir Tony’s recommendations include a call for the Ministry of Housing, Community and Local Government to reconsider how it judges the financial stability of local authorities, and has called for concerns to be raised between auditors and inspectorates including Ofsted and the Care Quality Commission.
The review, commissioned by former communities secretary James Brokenshire in July 2019, also called for local authority audit fees to be revised amid growing concerns they were not financially viable, and for the deadline for councils to publish their accounts to be extended to 30 September.
Launching his report, Sir Tony said: ‘I am grateful for the opportunity to undertake an independent review of local audit and the transparency of local authority financial reporting.
‘I have been guided by the need to see more accountability and transparency in the local audit system and my proposed recommendations reflect these principles.’
Communities secretary Robert Jenrick said: ‘I will consider the findings and recommendations carefully and remain committed to strengthening the local audit system so that it works more effectively for taxpayers and councils.
‘This government remains committed to a locally-led audit regime, alongside robust local scrutiny and local accountability by the press and public.’