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Audit Commission calls for improved ‘accuracy’ in grant claims

The Audit Commission has called for “improved quality” and “accuracy” in grant and subsidy claims and returns by local authorities.

This comes after 78% of councils’ claims to the grant-paying body for housing benefit subsidies for 2012-13 were challenged by the Audit Commission’s appointed auditors.

During this period, auditors issued a qualification letter in 35% (360) of the 1,023 claims and returns made by councils for 2012-13 in respect of seven schemes for grants or subsidies totalling £50.5 billion of public money from central to local government.

In the Audit Commission’s latest report, it was stated that 255 of the 360 (71%) qualifications related to claims for housing and council tax benefit subsidy. And, prior to certification, auditors identified errors in claims and returns that resulted in amendments totalling £17.3m – about 0.03% of the total value of claims and returns certified.

Marcine Waterman, controller of the Audit Commission, said: “It is particularly disappointing that, between 2009 and 2013, we have seen housing and council tax benefit subsidy claim qualifications increase from 60% to 78%.

“It is a persistent problem, with half of the authorities we audit having their claims qualified every year for the past four years. The Department for Work and Pensions has recently written to authorities requiring action on past qualifications and it is important that this has impact. We will continue to work with the Department to refine the approach to the work and to identify opportunities to reduce qualifications.”

From 2009 to 2013, the number of schemes requiring certification has fallen from 24 to seven, although the total value of these certified schemes has remained unchanged in real terms. This has been partly due to grant-paying bodies increasingly providing funding to authorities without specific conditions, removing the need for auditor certification.

Waterman added: “We have made sure that claims and returns are completed properly and have highlighted where the amounts claimed, or reported, were based on inaccurate information.

“Although only a small percentage of the billions of pounds involved, the amendments are still worth millions of pounds. As Teachers’ Pensions is developing its own certification arrangements for 2013-14, our work in this area will cease. The increase in auditor qualifications for 2012-/13 means Teachers’ Pensions should proceed with caution and care.’

Having reduced the number of schemes requiring certification to seven, this number will reduce further still in the next 12 months.

For instance, the Department for Communities and Local Government has decided to discontinue certification for the national non-domestic rates return. And, as noted above, the Teachers’ Pensions has decided to make its own certification arrangements.

However, the Audit Commission (until it closes in March 2015), and the transitional body that will succeed it in managing auditor contracts, will continue to make certification arrangements for housing benefit subsidy claims.

Tell us what you think – have your say below or email [email protected]


Plain Speak   23/06/2014 at 13:15

A qualification letter is deemed very serious if issued to a non-public sector body. How come that such returns are submitted with such a lack of integrity and those in charge get away lightly. Should not the repercussions for inaccurate returns lay with the Council management - who should be disciplined for potential fraud?

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