Spending watchdog qualifies audit of equalities body but acknowledges improvements
The head of the National Audit Office has qualified his audit opinion of the 2008/09 accounts for the Equality and Human Rights Commission, citing irregular expenditure in a number of areas.
Amyas Morse said the Commission had entered into seven tender procurement actions worth more than £50,000 without seeking appropriate authority from the Government Equalities Office.
“The Commission’s review of its procurement also identified some serious failings in procurement activity such as inadequate forward planning and a lack of focus on compliance with procedures,” the NAO said.
The watchdog said the EHRC had made “immediate and significant changes” to its procurement processes. These include removing a number of delegated authorities to incur expenditure, restricting the number of people authorised to raise requisitions and applying additional authorisation processes for all high value purchases.
The NAO said the Commission was taking action to ensure staff understand the procurement rules and comply with them.
The EHRC had also incurred irregular expenditure in breaching agreed limits for maximum pay rises for permanent employees, which it is required to agree with the Treasury and the Government Equalities Office.
The GEO imposed a maximum fine of £508,000 on the Commission in December 2009, although it was acknowledged that the EHRC’s errors were unintentional and a result of it employing fewer staff than originally predicted when its remit was agreed.
Amyas Morse said: “I am satisfied that the Commission is taking the issues we have raised seriously although, until it develops fully effective financial and management controls, it will face continuing risks to its ability to manage its expenditure properly.”
Neil Kingham, Director General of the EHRC, said he regretted the mistakes the Commission made in the first 18 months of its existence. He pointed to significant changes to its management team since then, and the appointment of a new board with a stronger audit and risk committee and accountability mechanisms in place.
“We are confident that these measures are securing more effective financial and corporate management,” he added.
Kingham claimed that the Commission had already made “a real difference” for millions of people since it was set up. “Now, more than ever, we have a vital role to play in ensuring that in this economic climate, public bodies pay due regard to the law when they implement budget cuts and that the most vulnerable people do not suffer unfairly as a result,” he said.
