APPENDIX 5
Supplementary memorandum by Sir Peter
Kemp KCB
Reflecting on the evidence given by myself and
others to the Committee on 14 April 1999, I would like to submit
this supplementary note, covering three points.
First, the reader of our evidence might think
of us as coming over as too critical. My own view, however, and
I believe the view of others who gave evidence, was that the PSAs
are indeed an important move in the direction of better public
services and value for money. There were some reservations and
some issues we raised, inevitable with a new departure like this,
but these will surely be sorted out in time.
Second, the discussion towards the end got into
a bit of confusion about auditing the numbers etc and publication.
My view is it does not much matter who does the auditing, whether
it is the Audit Commission, or the National Audit Office, or indeed
some private sector firm, provided this is done properly and effectively,
and is independent and publicly reported. None of us (and I speak
as a member of the Audit Commission) want to say that any of these
bodies have some kind of divine right. The more important point
is to get the Treasury and the Government to agree that there
should be an audit, which anyway at the time that we gave evidence
seemed doubtful. The issue should not get bogged-down into argument
about who might do it (an argument that has already surfaced in
one of the accountancy journals). [4]
Thirdly, there may have been some confusion
over the question of the publication of outcomes. There are many
and different ways of doing this of course. The Audit Commission
mode is a perfectly good one, but the Audit Commission's auditees
tend to have some kind of similarity, so one can make meaningful
comparisons between local authority and another. This is not possible
with organisations like, say, the Ministry of Defence or the Foreign
Office, where there are no comparators and the test has to be
that of outturn against target, coupled importantly with how these
moved this year against previous years. Central Government departments
and agencies on the one hand, and local authorities and health
authorities on the other, are different animals. But that does
not mean that Central Government departments and agencies' targets
and outturns cannot and should not be published and indeed for
agencies this is precisely what is done in the annual Next Steps
Report (the most recent being Cm 4273). Something of the same
model could be adopted for PSAs, though perhaps coupled with better
publicity and visibility than are the Next Steps agencies' outturns.
26 April 1999
4 Accountancy Age, 22 April 1999, p 6. Back
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