31.05.16
‘Disappointing’ lack of attention called to release of government overspend accounts
Annual accounts revealing the extent of the government’s overspend have been criticised for being incomplete and released without publicity.
The Whole of Government Accounts (WGA) for 2014-15, released last week after auditing from the National Audit Office (NAO), show that net expenditure (the shortfall between income and expenditure) grew from £145.7bn last year to £152bn.
In contrast, the government’s own fiscal measure, as reported in the National Accounts, says the deficit has decreased from £71bn to £57bn.
Anthony Walters, head of UK policy at the Association of Chartered Certified Accountants (ACCA), said: “It’s disappointing that the planned timescales to deliver the WGA have slipped and it has been pushed out in the pre-recess rush.”
He added: “It is vital that this important financial data does not get lost in the noise; it’s there to be used and to drive transparency and scrutiny in the way in which public finances are deployed and managed.”
The increase in net expenditure was attributed to an £8.4bn increase in the estimated cost of provisions, mainly due to decommissioning in the oil, gas and nuclear fields, a £7.5bn increase in net interest on pension scheme liabilities, and the impact of the triple lock policy on state pensions of £3.6bn.
The total number of government job losses last year was 20,346. Despite this, government expenditure on wages experienced a small increase, from £148.2bn to £148.3bn.
The government also experienced an increase in revenue from £652.9bn to £659.3bn, largely due to an increase in value added tax.
The NAO cautioned, however, that there were shortfalls in the reporting from a number of departments and organisations.
The Department for Education failed to provide an adequate assessment of how much it is spending on academies, the Ministry of Defence omitted lease assets and liabilities, the Department for Transport did not include the value of Network Rail’s infrastructure assets as it has yet to make an assessment of them.
In addition, the Royal Bank of Scotland, which has gross assets worth £1,050.8bn and gross liabilities worth £990.6bn, and other bodies which have estimated gross assets of £16.6bn and gross liabilities of £5.9bn, were excluded.
Amyas Morse, head of the NAO, said that there had been improvements in the completeness and accuracy of information in the WGA, which has previously been criticised by the NAO and the Public Accounts Committee.
However, he said it could “be a more powerful tool”.
“It provides a unique perspective because of its reach and approach to measuring the government’s financial performance and position,” he said.
“Better analysis by the Treasury of the nature of the assets across the government’s portfolio, the extent and sources of liabilities and the financial risks it is exposed to, will help Parliament and the public to understand better the full range of the government’s financial commitments and its approach to managing them.”
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