I shall come to the need to maintain a value-for-money focus in the work of the successor bodies for precisely the reasons that the noble Lord Heseltine set out, but I accept that the Audit Commission had its critics and in some respects it lost its way. The Opposition accept that there is no going back on its abolition—rather suddenly announced, to the surprise of many, by the Secretary of State in August 2010. Clearly, it is personal.
The fact that it has taken three years for the Bill to reach this House is a sign of the complexity of what has been removed and what has had to be created to replace it, and of an unfinished task. It took the dedicated probing of my noble Friends Lords McKenzie and Beecham—I pay tribute to them for their expert scrutiny in the other place—to draw out all the questions to which the Government still do not have answers, despite having had so long to think about them. I wish to acknowledge the helpfulness of the noble Baroness Hanham during consideration in the other place. She indicated the Government’s willingness to move on some of our areas of concern, but on one occasion she was famously reduced to saying that
“this matter is still under consideration, as are all the other matters.” —[Official Report, House of Lords, 15 July 2013; Vol. 747, c. 557.]
I shall now turn to these outstanding matters.
First, the Bill needs to provide for the joint procurement of audit for principal authorities, and we are told that this will be added in Committee. It must be, because significant savings can be made this way. The Government’s own impact assessment recognised that individual audit procurement was unlikely to match joint procurement when it came to producing lower fees. There is limited market in public audit. In the last financial year 800 councils, health bodies and fire and rescue authorities were audited by private firms. How many auditors were appointed? Seven. We believe, and many others agree, that the intended savings may not appear at all—quite the contrary.
A central procurement system with the power of appointment could yield savings of up to £200 million over five years, according to the Audit Commission’s own analysis. I do not understand why the Government spent quite so long in the other place resisting what is a very sensible idea, and we look forward to seeing the promised amendment.
Secondly, there seems to be a marked lack of enthusiasm on the part of Ministers for the kind of comparative value-for-money studies that the commission has undertaken. We are not yet sure how the value-for-money profiles, which help to ensure best practice and are currently maintained by the commission, are to be managed in future and by whom. When he introduced the original legislation to create the Audit Commission, the then Secretary of State, Lord Heseltine, said:
“Audit involvement in value-for-money work is not new, but the Bill gives much greater emphasis to it. The commission will have a duty to undertake comparative studies . . . and the auditor will have a duty to satisfy himself that the authority has made proper arrangement for securing value for money.”—[Official Report, 18 January 1982; Vol. 16, c. 52.]
This Bill puts less emphasis on it. Only a residual role is being given to the National Audit Office. Is that really the right thing for Ministers to do, given the pressures that councils face today, and the changes they are having to make to the way they work? Surely, this is a time when value-for-money studies—learning from others—are even more important than they were.