Mr Win Griffiths (Bridgend, Labour)

With this it will be convenient to discuss the following:

New clause 2—Prevention of unlawful expenditure—

'If the Auditor General for Wales has reason to believe that a Welsh NHS body or an officer of such a body—

(a) is about to make, or has made, a decision which involves or would involve the incurring of expenditure which is unlawful;

(b) is about to take, or has taken, a course of action which, if pursued to a conclusion, would be unlawful and likely to cause a loss or deficiency,

he shall refer the matter forthwith to the Assembly.'.

Mr Bill Wiggin (Shadow Secretary of State for Wales, Local and Devolved Government Affairs; Leominster, Conservative)

The new clause concerns the audit regime for NHS bodies in Wales. We welcome the fact that the Government have not simply copied the existing arrangements for health bodies, as they have done for most of the Bill, but have instead given the Auditor General fuller auditing responsibilities in the audit regime. However, some useful existing provisions have been excluded.

Under the existing legislation the health body auditor is allowed to act if he believes that unlawful expenditure is about to be incurred and needs to be looked into. The auditor can carry out an extraordinary audit, and the Secretary of State can call for one. Those provisions prevent problems from getting out of control. However, there are no such useful provisions in the Bill with regard to health bodies. That sets up differences between not only England and Wales but between health bodies and local authority bodies in Wales. The amendment is a version of section 19 of the Audit Commission Act 1998, which would restore the current position for health bodies.

Mr Don Touhig (Parliamentary Under-Secretary (Wales), Department for Constitutional Affairs; Islwyn, Labour/Co-operative)

New clause 2 would require the Auditor General to refer any matter relating to unlawful or potentially unlawful expenditure on the part of a NHS body in Wales to the National Assembly. The Government believe that it is unnecessary for the following reasons. Clause 60 gives the Auditor General statutory responsibility for the financial audit of Welsh NHS bodies. His statutory responsibility would be the same as it is now for the National Assembly and its sponsored bodies. The audit process that applies would also be the same.

An item of public expenditure would result in a qualification to an NHS body's accounts as it does now to other bodies for which the Auditor General has statutory audit responsibilities. He would publish a report in respect of the qualification and lay the report before the National Assembly.

In accordance with Standing Order 12.5, the Audit Committee of the National Assembly would meet to consider the circumstances surrounding the qualification. In doing so, it would take evidence from relevant officials with financial accountability responsibilities. The Committee would issue a report with its conclusions and recommendations, to which the Assembly Administration, in liaison with the NHS body concerned, would be required to respond within a set time scale, currently 30 working days.

Any potentially unlawful expenditure or unlawful decision would, as a matter of course, be brought to the attention of the NHS body's accountable officer and the National Assembly accounting officer for the NHS in Wales. With that explanation, the hon. Gentleman may feel that his new clause is not needed.

Mr Bill Wiggin (Shadow Secretary of State for Wales, Local and Devolved Government Affairs; Leominster, Conservative)

I am grateful to the Minister for his reply. If he is satisfied that an order to prevent illegal expenditure is not necessary, I hope that he is right. I do not wish to press the matter any further, but it is an important point to make during the drafting of the Bill. I feel that I have fulfilled my role in drawing it to the Committee's attention.

Question put and agreed to.

Clause 60 ordered to stand part of the Bill.

Clauses 61 to 66 ordered to stand part of the Bill.