Watchdog questions transparency code for parish councils with sub-£25k turnover

May 6, 2014

The draft Transparency Code for parish councils with a turnover under £25,000 will not adequately deliver on the Government’s goals of transparency and proportionate accountability arrangements, the Audit Commission has warned.

In its response to a Department for Communities and Local Government consultation, the watchdog also claimed that the Transparency Code would not be an effective substitute for external audit.

“Furthermore it will increase rather than reduce the burden on councils covered by it,” the Audit Commission said.

It added that a “truly proportionate” approach to accountability for councils spending less than £25,000 would be to rely upon existing mechanisms like Freedom of Information, without an additional transparency code.

The Audit Commission said it was working alongside its sponsor Departments and other key stakeholders “to help design a new regime for local public audit, that will be robust and sustainable”, following the closure of the Commission as outlined in the Local Audit and Accountability Act 2014.

In a previous consultation response to proposed secondary legislation under the 2014 Act, the Audit Commission had questioned whether:

The reduction in accountability that would follow from exemption from routine audit was appropriate given that 495 small bodies with a turnover under £25,000 received a qualified audit opinion in 2012/13.
The policy objective of reducing the burden on small bodies with a turnover under £25,000 would be achieved in practice, due to the proposals to maintain electors’ rights at audit even in the absence of an audit. The Commission therefore suggested consideration of disapplying the legal provisions for electors’ rights at audit completely for these authorities, if a reduction in the burden was the primary objective.

The Audit Commission, whose response to the Transparency Code consultation can be viewed here, said the combination of the code and non-routine external audit would be more burdensome than current arrangements.