Local Audit

Communities and Local Government written statement – made on 25th April 2013.

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Photo of Brandon Lewis Brandon Lewis The Parliamentary Under-Secretary for Communities and Local Government

I am today laying before Parliament the “Government’s response to the pre-legislative scrutiny report by the Draft Local Audit Bill Committee” (Cm 8566).

The Draft Local Audit Bill Committee published its report, “Draft Local Audit Bill: Pre-legislative Scrutiny” (HC 696), on 17 January 2013. We are grateful to the Committee for their deliberations and thank them for their report.

We have given the Committee’s report careful consideration in relation to the draft Bill and the proposed new local audit framework. We have also taken the opportunity to discuss specific recommendations with the National Audit Office and other partner organisations. This has provided the opportunity to further refine the Bill, making our intentions clearer, improving the drafting and the overall working of the Bill.

We have taken on board a number of the Committee’s proposals: for instance, to provide the Comptroller and Auditor General with powers to issue guidance to support the code of audit practice and increasing the explicit provisions for auditors to recover additional cost incurred through undertaking their functions. All of these proposals will help drive improvements in local audit, aims which were strongly supported by the Committee.

However, we have not taken on some of the Committee’s recommendations. We are not proposing to retain central capacity to procure and appoint auditors on behalf of local bodies as we do not believe that enforcing a centralised structure onto local bodies is efficient or effective. Local public bodies are perfectly capable of procuring and appointing their auditors once the Audit Commission has closed, however the Bill will allow local bodies to jointly procure their auditors, if they so wish.

We expect our reforms to bring significant long-term savings to taxpayers. Those significant savings will be fully quantified and will be published in the impact assessment that will accompany the final Bill. The majority of those savings will be realised by local government, representing meaningful reductions that will assist councils to manage their budgets during this challenging period, while ensuring that the same high audit standards are maintained to safeguard public money.

It remains our intention to introduce the final Bill as soon as parliamentary time permits. Subject to the timing of legislation, we intend to close the Audit Commission by April 2015.

Copies of the Government’s response are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office. The report is also available on www.gov.uk. the United Kingdom public sector information website.