MPs ask for clarity on how proposed local audit body will function

The Housing, Communities and Local Government Committee has asked the Government to provide information on its plans for its proposed new oversight organisation set to replace the Office for Local Government (Oflog).

The Ministry of Housing, Communities and Local Government announced the closure of Oflog last month, citing concerns about the body's "vague and broad remit" and resourcing.

The Government now plans to establish a new body to oversee local audit called the Local Audit Office (LAO).

A consultation on the proposed LAO and on reforms to the local audit system is currently underway.

Writing in a letter today (9 January) to the Secretary of State for Housing Communities and Local Government, Angela Rayner, the committee's chair, Florence Eshalomi MP, said the committee welcomed the move.

However, Eshalomi said that the committee does not believe that closing Oflog alone "will be enough to fix the issues in the local government audit system in England".

She added: "We would therefore like clarification and assurance from the Department about the steps being taken to address the significant challenges local government audit is facing.

"In particular, we would appreciate clarification on how the new Local Audit Office will work to improve the situation and how it will ensure that lessons are learnt from the experience of the former Audit Commission (as referenced in point 31 of the Minister's strategy)."

Eshalomi also asked the Ministry to explain how the LAO will work to ensure that the production, content and format of local authority accounts is aligned with the purposes of the accounts, once these have been agreed upon following consultation.

She also raised questions about the future role of the Financial Reporting Council (FRC) and other bodies involved in the local audit system now that the LAO will assume system leadership.

Adam Carey