Published 01 August 2013 | Standard notes SN06674
Authors:
Mark Sandford
Topic:
Local government
The Audit Commission was established by the Conservative government in 1983 as part of its drive to restrain local authority expenditure and to improve efficiency. Its prime function was to regulate the audit of local government bodies and NHS bodies in England. Its other duties have included inspection and performance assessment, as well as research activities designed to promote value for money via increased economy, efficiency and effectiveness.
The Commission was slated for abolition following an announcement on 13 August 2010. Whilst most of the Commission’s functions have already ended, the abolition itself will take place through the Local Audit and Accountability Bill 2013-14 [HL]. This follows a draft Bill published in July 2012, and a consultation paper, The Future of local public audit, in 2011.
The Government’s key policy is, as far as possible, to bring the public sector audit regime into line with the private sector. Under the Bill, local authorities will choose their own auditors, and a new decentralised audit regime covering local government, police and health bodies will be established. The Financial Reporting Council will become the primary regulator within the new framework and the National Audit Office will prepare and maintain the Code of Audit Practice and associated guidance to auditors.
The Bill also contains two additional clauses, one on the local authority publicity code and one adjusting the provisions for referendums on rises in council tax.
The Bill completed its progress through the House of Lords on 26 July 2013. At the time of writing, no date has been set for its arrival in the Commons. No substantial amendments took place in the House of Lords. Three divisions took place, all rejecting non-government amendments.
For more details on the background to the Bill, and the history of the Audit Commission, please see SN/PC/05681, The draft Local Audit Bill and the abolition of the Audit Commission