A former Ofsted inspector tasked with keeping an eye on Nottingham’s finances says it’s nonsense that huge sums of taxpayers’ cash are being spent looking into the past when they could be going on services.
The city council spends more than £600,000 every year on a private audit firm, Grant Thornton, to check its accounts from previous years.
All public organisations can now only employ the services of a select few private firms that are able to do this, after the Conservative and coalition government abolished the public-sector Audit Commission in 2015.
Significant backlogs have built up across the country, and the few audit firms that have the people-power to conduct the reviews have come under intense scrutiny as a result.
The backlogs mean many public organisations are having their accounts signed off without full assurance that everything is in order – in short, that taxpayers’ money is being spent properly.
But the delays are leading to hundreds of thousands of pounds being spent getting accounts up to date.
In Nottingham, large sums of money are being paid to the auditor to check historic balances dating back to 2019.
There are now calls for a “line in the sand” to be drawn so that more public money is spent on services rather than checking accounts from years ago, despite what some consider to be enough assurance from officials.
Andrew Middleton, a former Ofsted inspector who now sits as an independent scrutiny member on the council’s audit committee, said the “historic navel-gazing” is not productive, nor is it a good use of public money.
At an audit committee meeting on Friday (26 June), he said: “We are here to assure the public that this set of officers and councillors has good control of a chunk of public money, and the financial performance, the assurance of that performance, and the sign-off of the responsible [chief finance] officer, who will not do it against his professional judgement.
“So Nottingham City Council is in fairly good shape at the moment in the realm of local authority finances.
“Unless you are pursuing those historic years because you suspect there has been some fraudulent diversion of those reserves en route up to now, which I haven’t heard, I do ask: is there not a way we can ask the fundamental question: What best serves the interests of the Nottingham electorate, councillors, and officers to ensure we are properly using public money?
“I do not believe it is best served by going back many historic years and spending further public money, which could be spent on services, on giving assurance.
“When it suits the Government to write off historic debt, they just do it. So why is there not some common-sense approach being taken in this instance?”
The council’s corporate director of finance, Stuart Fair, said he would be raising the issue with CIPFA (the Chartered Institute of Public Finance and Accountancy).
The committee also suggested writing to the Government.
Mr Fair said he was putting his own professional reputation on the line, as the council’s statutory finance officer, by signing off the accounts.
“We are not the only authority in this particular predicament,” he added.
“I can give the audit committee assurance that I would not be signing off the council’s accounts if I wasn’t satisfied that we were fully compliant with the CIPFA Code of Practice.
“It is my own professional reputation that I’m putting on the line to sign that. I did that last year for the 2024/25 accounts, and I’m doing it again this year.”
By Joe Locker, Local Democracy Reporter