This report examines the effectiveness of internal audit in central government, covering both main departments and their associated arm's length bodies. Government is not getting the most out of the £70 million it spends on internal audit because the service does not always focus on the right issues and it is often not of sufficient quality to be useful in decision-making. 84 per cent of respondents to an NAO consultation considered internal audit added some or substantial value to their organisation, but had concerns over the current depth of insight, relevance and underlying execution of internal audit work. Many key stakeholders believe that internal audit work is not sufficiently tailored to be relevant to the different issues facing individual organisations. Treasury guidance on what internal audit should deliver is not sufficiently specific and there is little consistency in the application of standards. Variations in quality and coverage mean that the NAO often cannot take assurance from internal audit work. There are specific areas where internal audit could be more effective: the usefulness and relevance of reports; the expertise of staff, including expertise on IT-based information systems; the identification of efficiencies in the organisation; and the ability to offer advice to senior management. HM Treasury's Internal Audit Transformation Programme is a partial solution to the issues identified by the NAO, but needs more detail on what should be expected of an effective internal audit service. Nor does the Treasury have an accurate view on the costs of internal audit in government.
This report to Parliament summarises the results of financial audit work undertaken on behalf of the Comptroller and Auditor General in 2006, on the 2005-06 accounts of United Kingdom central government bodies and highlights key issues arising from that work. The Comptroller and Auditor General is the appointed auditor of all United Kingdom central government departments, executive agencies, and a wide range of other public bodies. In total, the Comptroller and Auditor General audits approximately 470 accounts per year, incorporating total expenditure and revenue of approximately £800 billion. In reporting the results of audit examinations, this report focuses upon the Comptroller and Auditor General's audits of the receipts of revenue and of public debt and reserves, as well as commenting upon the quality and timeliness of financial reporting and the other information accompanying the financial statements of the spending departments, their agencies and non-departmental public bodies. It also discusses the reporting of significant losses by departments and progress towards the future compilation of the whole of government accounts.
This report: informs Parliament of major issues the ANAO is confronting in working with agencies to encourage a better performing and more accountable public sector administration at this time; provides Parliament with a consolidated summary of the audit reports that have been tabled in the last six months as well as details of the better practice guides and audit services provided in the period; and focus on, and highlights, some of the major lessons learnt from the work of the ANAO in order to assist agencies and Parliament to improve public sector administration.
In 2004, the Gershon Review recommended that the Government pursue the sharing of services, including human resources, finance, procurement and payroll, to achieve cost savings. It has been up to individual departments to establish their own arrangements and, between 2004 and 2011, eight major shared service centres emerged. The five centres examined by the NAO were expected to cost £0.9 billion to build and operate but, to date, they have cost £1.4 billion. They were also expected to have saved £159 million by the end of 2010-11. While, in one instance Government has achieved break-even in a time consistent with the private sector, its overall performance has been varied and the two centres that are still tracking benefits report a measured net cost of £255 million. Most departmental customers have not acted as 'intelligent customers' and they will need to build in-house capability with enough business and technical understanding to manage the services and work with the centres to achieve efficiencies. Among other findings are that the software systems used in the centres have added complexity and cost; and that, as the use of the centres has been voluntary, departments have struggled to roll-out shared services fully across all their business units and arm's length bodies. The Cabinet Office has recently gained approval for a new strategy and business case. The NAO considers the approach is ambitious and has challenging timescales. The Cabinet Office is actively working with departments on its implementation.
In recent years a great deal of effort has been put into improving risk management in departments and in 2002 this was given further impetus when a two year risk programme was launched by the Prime Minister. This report looks at the progress made since the previous NAO report in 2000 (HC 864 1999-2000, ISBN 0105569488). It is based on a survey of the 20 main Whitehall departments, focus groups of 27 departmental risk managers, comparisons with the private sector, academic research and five case studies. The general conclusion is that significant improvement has been made but more needs to be done to make effective risk management a central part of general management processes. The ability to take risks and innovate, keep projects on track and handle complex service delivery needs to be further developed.
The objective of the follow-up audit was to outline the present situation regarding the retention of military personnel and assess the extent to which Defence has implemented the recommendations made in the original audit report (Audit Report No. 35, 1999-2000 Retention of military personnel).
In the memorandum 'The role of major contractors in the delivery of public services' the NAO sets out some of the benefits that can be achieved through contracting but highlights three issues that deserve greater public scrutiny. First, it raises questions about the way public service markets operate. This includes the need for scrutiny over whether public service contracts are sufficiently competitive and whether the rise of a few major contractors is in the public interest. Secondly, it highlights the issue of whether contractors' profits reflect a fair return. Understanding contractors' profits is important to ensure that their interests are aligned properly with that of the taxpayer. But transparency over rewards that contractors make is at present limited. Thirdly, the report asks how we know that contractors are delivering services to the high standards expected. In particular, government needs to ensure that large companies with sprawling structures are not paying 'lip-service' to control and that they have the right culture and control environment across their group. This requires transparency over contractors' performance and the use of contractual entitlement to information, audit and inspection. This should be backed up by the threat of financial penalties and being barred from future competitions if things are found to be wrong. A related report 'Managing government suppliers' (HC 811, session 2013-14, ISBN 9780102987034) examines the way the Cabinet Office is working to improve government's management of strategic suppliers.
This report gives an overview of the NSW government's computers in schools policy and provides information about practical aspects of putting computers in schools and using computers for teaching and learning. Looks at variation between schools in relation to computer use, infrastructure and support, networking and internet access. Includes references.
The implementation of a project to create a centre to streamline back-office functions - such as finance, HR and procurement - for the seven research councils has so far not been good value for money. When finally operational 15 months late, the Centre was delivering services across the five functions planned but some services, particularly finance, are not yet where they need to be. By the end of March 2011 the project was £51 million over budget. Available evidence indicates that to date the project has underachieved against total expected savings by at least £73 million. The original business case, which led to the decision to opt for the shared service centre, was flawed. The projected savings to be made from better procurement were uncertain and a proper financial analysis should have prompted a re-evaluation of the available options. The reasons for the overrun and delay included complex governance arrangements, slow decision making and the lack of a clear vision for the project from the outset. The contract with Fujitsu, the supplier of the Centre's ICT systems, was terminated wasting £13 million because some elements of the system then had to be rebuilt in-house. When the project did start to go off-course, the Department for Business Innovation and Skills, as sponsor Department, did not intervene. A single shared service platform has the potential, if managed effectively, to offer broader benefits through streamlined processes. The report concludes that there is significant scope for further savings.
This report examines the management of financial resources to deliver better public services effectively. Divided into four parts, with appendices, it looks at the following areas: Part 1: The importance of managing financial resources; Part 2: Developing the skills and awareness necessary for effective financial resource management; Part 3: Improving departments' use of techniques and practices for managing financial resources; Part 4: The impact of improved management and financial resources. Financial rsource management is relevant to every aspect of a Government department's business. By 2010-11, central government spending is forecast to grow to £678 billion, which represents £11,000 for every person in the UK. The NAO has set out a number of findings and recommendations, including: that the lack of financial skills and awareness amongst non-finance staff remains a significant barrier to improving the management of financial resources across government; that some departments lack a qualified Finance Director at Board level; that senior managers in many departments are not provided with incentives to promote sound management of financial resources; that Departments could do more to improve their forecasting capabilities; that some Departments are not sufficiently well placed to integrate financial and operational performance information; that many Departments do not always ensure the full assessment of the financial implications of policy proposals.
Auditor-General of New South Wales Report to the Legislative Assembly of NSW on the Sale of the TAB. The Report, dated December 1998, contains a detailed analysis of the extent to which the NSW's Government's objectives, as outlined in the Rules of Engagement concerning the sale of the TAB, were achieved.
The Capability Review programme was launched in 2005 to assess and compare systematically, for the first time, individual departments' organisational capabilities and ability to deliver their objectives. This National Audit Office report finds that the programme has led to evidence of greater capability in departments, but departments have yet to show that the programme has had an impact on outcomes in delivering public services. Action to tackle weaknesses in capability is now a prominent feature of board business and every department has a board member leading its review response. However, there is some uncertainty in departments about whether, or how, the programme will continue, risking a loss of momentum. The first-round reviews found common weaknesses in board leadership, determining the best way for delivering public services and staff skills. There is now evidence of improved capability, particularly in boards' visibility and cohesion. The report also finds: Capability Reviews are encouraging departments to work together while at the same time sharpening their focus on comparative performance; Capability Reviews focus on departments, but services are often implemented by external agencies which are not covered directly by reviews; and there is no benchmarking of departments' capabilities against external organisations, which might offer examples of best practice.
This report finds that central government departments have spent around £600 million gross on the early departures of 17,800 staff in the year from December 2010. These costs are around 45 per cent lower than they would have been under the previous Scheme. After meeting the initial costs, departments will save an estimated £400m a year on the paybill. The time it takes departments to start seeing these savings depends on how quickly they can eliminate headcount-related costs, such as on IT and property. The net present value of the early departures to the taxpayer will be between £750 and £1,400 million over the spending review period, depending on the ability of departments to eliminate costs. This figure will also be affected by whether those leaving find comparable work and pay tax, or claim benefits. Of those departments that are reducing staff numbers, the proportion of staff released ranges from less than 1 per cent at the Department of Energy and Climate Change to around 16 per cent at the Department for Communities and Local Government. Departments used large-scale open voluntary exit schemes to release staff as quickly as possible, though this meant departments could not predict accurately which staff would leave. Older, more senior staff are leaving in the first tranches. This is partly because of deliberate restructuring, but also because those staff who have worked in the civil service for longer, or who are over 50, gain more financially from taking voluntary exit or voluntary redundancy.
The Office of Fair Trading (OFT) has improved its operations following recommendations on maintaining competition in markets made by the National Audit Office and Committee of Public Accounts in 2005 and 2006. It now needs to concentrate its efforts on strengthening the skills and experience of its staff at key management grades, and be clearer on how long it expects its investigations will take. The OFT is now directing its work to areas that have the most impact, though this refocus on higher priority cases has led to a perception that the OFT is less interested in smaller markets, with a risk that its deterrent effect will be reduced in these markets. The OFT has taken steps to address this perception, launching investigations into more local markets such as in construction and bus transport. The time taken to process high profile cases has been reduced by introducing better project management and more flexible ways of working, including using bigger teams and temporary legal staff. The OFT has also brought criminal charges in two cartel cases for the first time under the Enterprise Act, one of which to date has resulted in criminal convictions. The OFT recognises that some of its cases are still taking too long. The OFT operates in a competitive labour market and still continues to face challenges in attracting and retaining talented staff. The OFT has provided project management and leadership training to its staff, but it needs to sustain and increase this work in order to continue to recruit and retain staff at key management grades.
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