There is a need for a step change in transparency by local public bodies and particularly those in the NHS, MPs have said.
In a report, Auditing local government, the Public Accounts Committee noted that in 2017-18, auditors found that more than 1 in 5 local public bodies did not have proper arrangements in place to secure value for money for taxpayers.
“The numbers are worst for local NHS bodies such as clinical commissioning groups and hospital trusts, where 38% did not have proper arrangements,” it said.
The MPs added that some local bodies were not putting enough information in the public domain about their performance, including reports from their external auditors.
The report called on central government departments to make clear their expectations, “not only for what is made publicly available, but also for making the information accessible to users and so helping citizens to hold local bodies to account”.
The PAC said there appeared to be few consequences for those local bodies who did not take auditors’ concerns seriously and address them promptly. “Even where local auditors use their additional reporting powers to highlight failings, this does not always lead to the bodies taking immediate action.”
The report also recorded the MPs’ concern that, as partnership working becomes more complex, accountability arrangements will be weakened, and the performance of individual local bodies will become less transparent.
Meg Hillier MP, chair of the committee, said: “Taxpayers must be assured that their money is well-spent but in too many cases local bodies cannot properly safeguard value. Particularly concerning are NHS bodies such as Clinical Commissioning Groups and hospital trusts: last year almost two in five did not have adequate arrangements.
“As we reported last week, many CCGs are underperforming and this must improve as they take on responsibility for commissioning services across larger populations.”
Hillier added: “It is vital that local bodies take auditors’ concerns seriously, address them swiftly and ensure meaningful information on performance is made accessible to the public.
“Our report sets out ways central government can help to drive improvements at local level and we urge it to respond positively to our recommendations.”
The report’s recommendations included that:
- Central Government departments should set out, by the end of September 2019, clear expectations of how local bodies should respond to weaknesses reported by local auditors in 2018-19, including the potential consequences for local bodies who fail to improve.
- Departments should report by the end of September 2019 on how they have made use of the information gathered through their monitoring arrangements in 2018-19 to: identify concerns and examples of good practice for wider sharing; and challenge local bodies to demonstrate they are strengthening their arrangements.
- Departments should, by the end of September 2019, set out clearly to local bodies their expectations of the information that should be made publicly available to improve transparency, including information provided by the local auditor.
- Departments should, by the end of September 2019, set clear expectations of how local bodies should ensure that the information provided is accessible to all users and enables citizens to hold local bodies to account.
- Departments should, in their next accounting officer systems statements, expand on: the use of the assurance provided by local auditors; and how they will get assurance in areas not covered by local audit, such as how partnerships are held to account for joint decisions and responsibilities.
Paul Dossett, head of local government at Grant Thornton UK, said: “The public, quite rightly, want to know how and where their money is being spent and be reassured that it is being spent in the most efficient way possible. Public audit has played a role in ensuring this level of transparency, and also in calling out and addressing poor behaviour and performance.
“Building public trust is really important and local bodies should take any issues raised by an auditor seriously and act upon them accordingly. They should also ensure that information, including auditor reports, is easily accessible and meaningful and concentrates on what matters most to the taxpayer.”