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Helping the public sector respond to a challenging and changing environment
1. Helping the nation spend wisely | 1
Helping the public sector
respond to a challenging
and changing environment
Sian Jones | Audit Manager | July 2013
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Our role
The National Audit Office (NAO) scrutinises
public spending for Parliament
We help to hold government departments
and the bodies we audit to account for how
they use public money
Our work helps public service managers to
improve performance and service delivery,
nationally and locally
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* Committee of Public Accounts
The accountability process
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There are five dimensions to our work
* International Organisation of Supreme Audit Institutions
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Our work is produced for
• The Committee of Public Accounts (PAC)
• Other select committees, including the
Public Administration Select Committee,
Environment, Health, Transport, etc.
• All MPs and peers
• Senior officials in government departments
• Members of the public and groups interested
in aspects of our work
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By highlighting the scale of the financial challenge
Source: NAO analysis of HM Treasury data
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By outlining improvements needed at the centre
to support departments in financial management
We recommended that Treasury:
• strengthen the evidence base for key processes such as spending
reviews, to better inform how resources are allocated and prioritised across
government
• consider the medium- and long-term effects of its resource allocation
processes, to avoid incremental decision-making
• identify opportunities where early action or service integration can improve
value for money
• actively promote a collaborative approach to financial management, for
example by encouraging joint funding bids; and
• work to align financial accounting and reporting with initiatives to develop
and improve management information (Quarterly Data Summaries).
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By looking at projects earlier in the cycle to
maximise potential for achieving value for money
Our work on HS2 outlined issues with, amongst other factors, the timescales for the project:
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By recommending a number of actions to the
Department for Transport
Programme management
• The Department should ensure that it has sufficient time to develop the
programme, including to respond to unexpected issues, and that its work is
structured around the key objectives it is trying to achieve.
• It should develop a realistic timetable for the hybrid bill, which includes
allowances for unforeseen or uncontrollable delays and builds in sufficient
time for proper scrutiny and quality assurance.
• It should structure the programme’s key processes and documents so
they focus on meeting the programme’s objectives, including achieving
regional economic growth.
• The Department should set a timescale for management to respond to
issues raised in assurance reports on the programme and monitor how
recommendations are implemented.
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By building up our expertise in local delivery
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By spelling out the challenges at local level
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By making an appropriate contribution to future
local public audit arrangements
• Providing expert advice/input to assist Government’s thinking around its
proposed new arrangements for local public audit (e.g. participation in
DCLG Implementation Steering Group and associated work streams)
• Taking on new responsibilities within the proposed audit framework
consistent with the NAO’s core role (Code of Audit Practice)
• Leading transition work on the Code of Audit Practice to help ensure a
smooth transfer of responsibilities
• Engaging with the sector to develop VFM studies that add value at the
local level (e.g. creating the Local Government Reference Panel – to
discuss future work and consider progress on studies underway)
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By providing practical guides and support
We have published fact
sheets and good practice to
support departments on:
• Audit Committees
• Internal audit
• Governance statements
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Initiating successful projects Managing risks in government
By including example models and principles
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Taking on new responsibilities
• Auditing organisations in the reformed financial
regulatory system, such as the Financial Conduct
Authority
• Auditing probation trusts across England
• Developing local government work, including
preparations to take on new responsibilities for
overseeing the Code of Audit Practice
• Extending our VFM work into specific devolved
Health providers, notably Foundation Trusts
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• We carry out investigations into areas of concern raised
with us by MPs or members of the public.
• In 2012-13 this work included:
• contracting out language services in the justice system;
• the progress of the Work Programme; and
• preventing fraud in contracted employment programmes.
• In 2013-14 we will be looking at, amongst other things:
• Gagging clauses
• Whistleblowing polices and practice across government
• Contractors
Building on our investigations work
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Maintaining our local presence
• Newcastle office with around 90 staff, comprising
approximately 10% of our office
• Has Health, HMRC, DWP and Defra as its clients
• Good links with local stakeholders
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How to find out more
• Visit our stand
• Get in touch with our Newcastle office on 0191 269 1820
• NAO website www.nao.org.uk
• Follow the NAO on Twitter @NAOorguk
• Sign up for email alerts with NAOdirect
• NAO videos on YouTube
• NAO Annual Report & Accounts 2012-13
• Public Accounts Commission
Notas do Editor
Audited bodies include:Departments - e.g. Health, DefenceAgencies - e.g. Highways AgencyNDPBs - e.g. Environment Agency, Competition CommissionCharities – e.g. British Council, V&ACompanies – e.g. School Food Trust
The Committee of Public Accounts (PAC)Select Committee of the House of CommonsChaired by an Opposition MPEvidence session based on C&AG’s reportQuestions put to Accounting OfficerReports and makes recommendationsSessions last 1-2 hoursInvestigative styleDesigned to be formidableGovernment must respond to PAC reportTreasury Minute
Source: NAO Annual Report and Accounts 2012-13Example of our impact: Investigating concerns on contracting out the provision of language services for use in courts by the justice system In response to concerns raised by Members of Parliament, interpreters and the public, we investigated the Ministry of Justice’s contracting out of language services to Applied Language Solutions. Our work brought these issues to Parliament’s and the public’s attention and raised important learning points for the Ministry’s procurement and contract management processes. The Committee of Public Accounts held two hearings to question those involved, and the Ministry accepted all the recommendations in the Committee of Public Accounts’ subsequent report.
Financial Regulatory bodies: In 2012-13, we prepared for the audit from April 2013 of the bodies in the new financial regulatory framework, including the Financial Services Compensation Scheme, the Financial Ombudsman Service, the Money Advice Service, the Prudential Regulation Authority and the Financial Conduct Authority. Local government: During 2012-13, we increasingly focused on the issues facing local government and other local public services. We implemented the first phase of our work with the local government sector to build links and understanding between local public services and the NAO. We are also working with government and other stakeholders to prepare to take on new responsibilities for overseeing the Code of Audit Practice for auditors of local authorities when the Local Audit Bill completes its passage through Parliament. We also set up a local government reference panel to help us plan our value-for-money work in this sector. We published reports on the financial sustainability of local authorities, community budgets, new homes bonus and central government’s communication and engagement with local government. Probation trusts: In 2012-13, the C&AG became responsible for auditing 34 English probation trusts. We worked with trusts and sector organisations to develop the framework for our audit. We identified innovative approaches to streamline the audit process, making a ten per cent reduction in audit fees to trusts this year, compared with previous arrangements. The sector welcomed our approach, which has helped to build our credibility as an auditor for local public service bodies. Foundation trusts: TPAC gave us additional funding to investigate VFM issues in this sector following on from our report on Foundation Trusts: financial sustainability.