Councils to choose auditors after shake up


The Department for Communities and Local Government published its proposals for the way local government bodies will be audited yesterday, following the decision last year to abolish the Audit Commission.

The move comes after CLG launched a consultation last year as it sought to reduce the cost of auditing.

Housing minister Grant Shapps said: ‘We are taking another step down to road to replacing expensive centralised local public audit with a more streamlined and competitive local audit structure.

‘Councils are already showing they can be open and accountable – publishing details on their day to day business from spending to structure and taking control of their own auditing affairs.’

Local public bodies, including councils, will now be able to appoint auditors from an open market, with the model based on private sector auditing and overseen by the Financial Reporting Council and National Audit Office.

The abolition of the Audit Commission was labelled a ‘missed opportunity’ by the communities and local government select committee. In its report, the cross-party group of MPs said that a wider review of the scope of public sector auditing was required.

Labour MP Clive Betts, who chairs the committee, said that while ‘some of the points’ of the report had been taken on, it remained ‘absolutely key’ that any new auditors should be able to retain their independence.