In 2017-18, local government (495 local authorities, police and fire bodies in England) spent about £54bn. The Department of Health and Social Care (DHSC) also provided about £100bn to 442 local NHS bodies. Given increasing financial and demand pressures, local bodies need strong arrangements to manage finances and secure value for money. External local auditors have a key role in determining whether these arrangements are strong enough.
The Committee is doing an inquiry into the finances of local bodies such as councils and NHS bodies from the local rather than national audit perspective. The Committee’s recent reports on Financial sustainability of police forces, Financial sustainability of local authorities and Financial sustainability of the NHS have highlighted from a national perspective some of the key issues local public bodies are facing.
Local public bodies (e.g. councils, police and crime commissioners and fire and rescue authorities, and local NHS bodies such as NHS trusts and Foundation Trusts) are finding it increasingly difficult to balance delivering good quality services with maintaining a sound financial position. This NAO report summarises the issues reported to local public bodies by their external auditors in 2017-18, and show how the number and type of issues reported has changed over recent years. It will also provide an insight into how local public bodies are responding to the issues raised, and the extent to which information from local auditors feeds in to the oversight arrangements of relevant central government departments.
Members will question representatives from the Department of Health and Social Care, the Ministry of Housing, Communities and Local Government, NHS, and NHSI about their handling of issues relating to matters being raised locally, and how they are monitoring the growing number of non-standard reports issued by local auditors.
Members will also wish to get Departments to commit to challenge local bodies to take action in response to weaknesses in arrangements to secure value for money. The hearing will also allow Members to explore how local auditors are currently using their additional powers.
