Four in ten NHS bodies managing money poorly

The number of NHS and local government bodies with significant weaknesses in their arrangements for delivering value for money for taxpayers is increasing.

The report, from the National Audit Office (NAO), found that 495 local authorities, local police and local fire bodies were responsible for around £54 billion of net revenue spending last year, and that 442 local NHS bodies received funding of approximately £100 billion.

Of growing concern, auditors have identified significant weaknesses in an increasing number of local bodies’ arrangements to secure value for money, up from 170 (18 per cent) in 2015-16 to 208 (22 per cent) in 2017-18, with variations in increase between local government and NHS sectors.

The NAO reports that the number of local government bodies receiving qualified conclusions was eight per cent in 2015-16. In 2017-18, and with 20 conclusions still to be issued, the same percentage of qualified conclusions have been issued overall, but 18 per cent of single tier local authorities and county councils received a qualification. In the NHS, the number rose from 130 (29 per cent) to 168 (38 per cent) across the same period.

The high level of auditor warnings highlight how many NHS bodies are not meeting financial targets, are not delivering required savings, and do not have sufficient plans to sort out their financial problems.

The warning comes just after the launch of a 10-year plan for the NHS detailing how a record £20.5 billion will be spent.

Amyas Morse, the head of the NAO, said: “I am shocked by the persistent high level of qualified audit reports at local public bodies. A qualification is a judgement that something is seriously wrong, but despite these continued warnings, the number of bodies receiving qualifications is trending upwards. Let us hear no cries of ‘where were the auditors?’ when things go wrong. The answer will be ‘they did the job, but you weren’t listening’. This is not good enough; local bodies need to address their weaknesses, and departments across government should ensure they are challenging local bodies to demonstrate how they are responding.”

Meg Hillier, chairman of the Committee of Public Accounts, said: “It is deeply concerning that local auditors are raising increasing numbers of concerns about local bodies’ arrangements to secure value for money, but these are often not being listened to and there is no consequence for the local bodies themselves. With ever stretched public services, citizens deserve to know that there are effective arrangements in place to make sure they are getting value for money.”

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