Auditors have found that most claims for grants and subsidies have been completed by councils in line with the terms and conditions set by grant-paying bodies. But there is room for improvement. Claims and returns were corrected by £54.5 million as a result of Audit Commission auditors’ work.
The Commission's new report, Local government claims and returns 2008/09, covers claims for grant and subsidy in England totalling £45.6 billion. Auditors say most claims and returns were completed correctly.
Martin Evans, the Audit Commission's Managing Director of Audit, said:
‘Our auditors’ work gives assurance to central government and other bodies that pay out grants and subsidies. We’ve made sure claims and returns were completed properly and pointed out where the amounts claimed or reported were based on inaccurate information.
‘The big picture shows the amendments are worth millions of pounds, albeit a small percentage of the billions of pounds claimed.’
The new report contains a summary of auditors’ work that found errors or examples of non-compliance with grant terms and conditions. Auditors flag up these issues with claimant councils and those who pay grants.
Sometimes agreement is reached between the auditors and the councils and claims are amended. But if there is no agreement, the auditor explains concerns in a qualification letter to the grant-paying body so it can decide on possible action.
Housing and council tax benefits are a particular concern with 85 per cent of claims qualified, amended, or both by auditors. The report says the complexity of the system and large volume of transactions provides much scope for error. Common issues are difficulty with documentation to support payments to benefit claimants and data entry errors.
Some authorities need to improve their practices. The number of qualification letters issued by auditors to authorities, signalling concerns with a claim or return, increased from 626 in 2007/08 to 673 last year: 24 per cent of claims and returns had qualification letters.
The report covers a range of schemes. The overall value of claims and returns certified by auditors increased by 2.8 per cent on the previous year. Housing and council tax benefits, and the national non-domestic rates return, account for 82 per cent of the total £45.6 billion certified.
Notes for editors
- Audit Commission auditors provide assurance to grant-paying bodies (eg government departments) that claims on them for grants and subsidies comply with terms and conditions, or that financial information provided in returns is reliable. The auditor’s certification gives assurance about a council’s entitlement to grant or subsidy, or the information provided in a return.
- More detail on certification arrangements is in the Commission’s Statement of responsibilities in relation to claims and returns.
- In 2008/09, Audit Commission auditors certified claims and returns from local authorities for schemes covering £45.6 billion of public money. Amendments to claims and returns totalled £54.5 million.
- Comparisons between years need to be treated with caution as scheme arrangements can change from year to year. Figures can also be affected by a small number of large amendments. For example, in 2008/09, £9.4 million of the increase relates to a single return at one authority. The increase in total amendments does not therefore reflect poorer performance across the board.
- The Audit Commission is an independent watchdog, driving economy, efficiency and effectiveness in local public services to deliver better outcomes for everyone.
- The Commission’s work across local government, health, housing, community safety and fire and rescue services means that we have a unique perspective. We promote value for money for taxpayers, auditing the £200 billion spent by 11,000 local public bodies. As a force for improvement, we work in partnership to assess local public services and make practical recommendations for promoting a better quality of life for local people.
Nigel Watts
Media Relations Manager
020 7166 2129 or 07813 315538
nigel-watts@audit-commission.gov.uk