Bitter Audit Commission sees irony in its demise
The Audit Commission’s chairman has seen the irony in Eric Pickles’ decision to axe his organisation.
Michael O’Higgins said it was ironic that local authorities were being given extra responsibilities precisely because the Audit Commission’s oversight had helped them improve their performance.
His barbed message came after communities secretary Eric Pickles confirmed the decision to wind up the Commission a day ahead of schedule.
News of the move had broken after the local government spending watchdog’s management emailed employees on Friday informing them of the news.
“I am really shocked at the callous way in which the top brass of the Audit Commission have treated their staff,” Mr Pickles said in response.
“They knew about this. We gave them time to get their staff together, to talk it through, to explain we’re looking at a mutualisation.
“But yet again they’ve just decided to go for a headline and they’ve used their staff as a battering ram against the government.”
He claimed axing the Audit Commission would save £50 million a year.
Mr O’Higgins’ defiant statement outlined the ways in which the watchdog had “more than fulfilled” the ambitions of its founders.
The 1985-86 rate-capping rebellion, gerrymandering on Westminster council and the recent detection of over £200 million of fraudulent funds through the national fraud initiative were all flagged up.
“We have also had a role in assisting in the very significant impact of local authority improvement in the last decade,” Mr O’Higgins added.
“Ironically, it is this improved performance – as referred to by decentralisation minister Greg Clark, when he compared it favourably to central government’s performance – that has enabled ministers to have confidence in increasing local authority autonomy.”
The government is considering a number of options for the Audit Commission’s future, including sale, a management buyout and the setting-up of “some sort of mutual organisation”, he added.
“It is critically important that during the coming period of uncertainty, and the transition period, that we ensure local accountability, and the accurate audit of public spending, is carried out effectively,” Mr O’Higgins added.
Shadow communities secretary John Denham said Mr Pickles’ decision was motivated by a desire to prevent taxpayers from receiving information about the value for money of local services.
“Without the function of the Audit Commission there will be no one to step in when a council is failing, as Doncaster was recently,” he said.
“This move by the government shows they are only interested in the cost of everything and the value of nothing.
“It opens the door to huge and unjustified variations in the quality of services from one area to another.”
Earlier today the Financial Times newspaper published what it claimed was a full memorandum circulated among Audit Commission staff.
It quoted Eugene Sullivan, chief executive, as saying: “I am surprised by this decision. The decision has been taken without any consultation with the Commission on the principles involved, especially that of the independent appointment of auditors.
“The independence of audit, its disinterested pursuit of good value in public spending, its custodianship of best practice in financial management: these are not to be lightly cast aside.”
The Commission works across local government, covering health, housing, community safety and fire and rescue services. It has an annual budget of over £200 million a year.
