Government Resources and Accounts Act 2000 (Audit of Public Bodies) Order 2012

Lord Eatwell Excerpts

Monday 27th February 2012 Grand Committee

[The Commercial Secretary to the Treasury (Lord Sassoon)]

My Lords, the Government Resources and Accounts Act 2000 (Audit of Public Bodies) Order 2012 has been laid under the Government Resources and Accounts Act 2000. It is intended to give the Comptroller and Auditor-General public audit responsibility for auditing the accounts of a number of public sector bodies and companies. It also removes the Comptroller and Auditor-General from auditing a number of public bodies and companies because they have been abolished, merged or ceased to meet the criteria for public sector audit.

The main provision in the order is to give the Comptroller and Auditor-General statutory audit responsibility for 34 English probation trusts. The English probation trusts are currently subject to audit by the Audit Commission. As noble Lords will be aware, the Audit Commission is to be abolished and it is necessary to find suitable auditors for the probation trusts to take the Audit Commission’s place. While there are plans to introduce an Audit Bill to implement a new local audit framework, the parliamentary timetable is uncertain. In line with discussions with the probation trusts, it makes sense to make the change now, using the powers in the Government Resources and Accounts Act 2000.

It is already the case that the Comptroller and Auditor-General exerts his influence over the external audit of trust accounts by the issue of group instructions. Those instructions are necessary to obtain the assurance needed to certify the consolidated accounts of the National Offender Management Service. The new arrangements envisaged under this order will not lead to any loss of autonomy for the trusts.

The Horserace Betting Levy Board is also included in the order. It is not the role of government to be involved in horseracing matters and Ministers are exploring how the body might be reformed or replaced. Until final decisions are made on the future of the levy or the board, it remains a central government body and should be audited by the Comptroller and Auditor-General. This order also removes four museums from the C&AG audit, as they have been subsumed within the new National Museum of the Royal Navy and their accounts will be consolidated with the accounts of the new body. The National Museum of the Royal Navy is one of the companies made subject to C&AG audit, thus retaining parliamentary accountability for the museums. The other two companies are HS2 Ltd and UK Anti-Doping. I think that that is not to do with horseracing explicitly but with other aspects of sport. We will come to that later.

HS2 was set up to carry out a feasibility study for a new rail line in the UK. Following a triennial review of its future, it was decided that HS2 should remain a non-departmental public body and continue to focus on the West Midlands line from London to Birmingham and the link to Heathrow. As a non-departmental public body, it is right that HS2 be audited by the Comptroller and Auditor-General. As the principal adviser to government on drug-free sport, UK Anti-Doping is responsible for protecting sport from the threat of doping in the UK. It is an NDPB and therefore also should be audited by the C&AG.

Finally, the order removes three non-profit-making companies from the scope of the Government Resources and Accounts Act 2000 (Audit of Non-Profit-Making Companies) Order 2009 because they are no longer eligible for audit by the C&AG either because they have been moved into the private sector or have ceased operation. These companies are Firebuy Ltd, Phoenix Sports and the School Food Trust.

In conclusion, the proposals in the draft order confirm the Government’s commitment to achieve consistency in the public audit arrangements for public bodies and provide a net gain for Parliament and the public. I commend the order to the Committee.

[Lord Eatwell]

My Lords, I have no comments on this order.

[Lord Newby]

My Lords, I am sorry to detain the Committee. A number of years ago I was an adviser to the School Food Trust and I should simply like to ask which of the two categories it falls into. I believe that it has become a private sector body rather than abolished. Both the Explanatory Memorandum and the Minister’s speech have failed to clarify into which of those two groupings it falls.