Accountability for public money - Public Accounts Committee Contents

Conclusions and recommendations

1.  We welcome the Government's acceptance of the need to reconcile the policy intention of its reform and localism agenda with the legitimate demands of parliamentary accountability. We urge the Government to consider the fundamentals of effective accountability set out in this Report and consult fully with Parliament on how accountability will be delivered within the context of its reform agenda.

2.  Local accountability and reformed structures do not absolve departmental Accounting Officers of their personal responsibility to gain assurance on the way funds voted to their departments are spent. The Cabinet Office and the Treasury distinguished between Accounting Officers' accountability for system-wide issues and accountability to the local community or service user for the performance of local bodies. Our interest is in the financial management and value for money secured from all departmental spending and we expect Accounting Officers to put in place arrangements to provide us with the assurances we need. Parliament needs to be able to assure the public that value for money is obtained and Government must put in place arrangements to enable Parliament to do its job.

3.  The accountability arrangements supporting the localism agenda are unclear. The National Audit Office estimates that 37% of central government tax receipts are devolved to local bodies. We support the aim of enhancing local accountability and user accountability, but thinking on how local communities and users hold bodies accountable in practice is rudimentary. The Government's review of accountability needs to consider the extent to which local accountability will act as an effective pressure to secure service improvements without due regard to value for money, particularly where there is no local financial incentive to keep costs down.

4.  The reform agenda anticipates a plethora of delivery and accountability models, some of which are untested. Responsibility for delivering public services will be devolved to established entities such as local authorities with a strong record of managing public funds but also to new and untested bodies, for example GP consortia or free schools. The Government's accountability review should map out the landscape of the different delivery models and proposed accountability arrangements for each form of reform and ensure they comply with the fundamentals we have outlined.

5.  Accountability regimes must be underpinned by sound information systems, yet our experience suggests this is an area of systemic weakness. Whether to aid the 'armchair auditor' and the users of local services, or to provide the assurance that Accounting Officers need to fulfil their responsibilities to Parliament, information about local delivery needs to be comparable and robust. The Government acknowledged that where resources are devolved to local providers, performance is likely to vary. Currently, users of local services have little or no access to information on the cost, quality or value for money of the services and this limits their ability to make informed judgements between alternative providers. Even if they did have access to the necessary information, service quality would be likely to prove the overriding priority for service users; cost and value for money would be secondary considerations in selecting the appropriate service. Government should specify what performance, financial and outcome information is needed to enable effective transfer of responsibility to local service providers.

6.  Accountability for the delivery of major projects and programmes must be clear so those responsible for delivery can be held to account. There are weaknesses in personal responsibility and accountability for major projects due to the high turnover and lack of central oversight of Senior Responsible Owners. Government acknowledges that there is a shortage in project management expertise. This dilutes control over major projects, has led to cost overruns and delays and further weakens accountability to Parliament. The Cabinet Office is updating its current approach to enhancing project management expertise. At a project level, Senior Responsible Owners should be held accountable for delivering projects within an agreed budget and timeframe and should have authority to direct those involved in delivering the project. For all major projects and programmes, the Accounting Officer should nominate a Senior Responsible Owner who is accountable to Parliament alongside the departmental Accounting Officer. Steps should be taken to reduce the present turnover of staff, which undermines efficiency and effectiveness and makes a nonsense of personal responsibility and accountability.

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© Parliamentary copyright 2011
Prepared 5 April 2011