Government’s spending watchdog flags up various challenges – including Treasury tech systems and gaps in information from councils – faced by project to deliver publication rounding up public sector outgoings and incomings
Public-spending watchdog the National Audit Office has warned that the Whole of Government Accounts snapshot of public spending is being devalued by delays, missing data and unreliable information.
NAO head Gareth Davies makes the criticisms in his report to MPs on the 2020-21 version of the accounts, which he noted was published seven months later than originally intended and had come more than two years after the end of the financial year it covers.
Covid-19 and problems with HM Treasury’s new OSCAR II IT system were blamed for delays with the 2019-20 WGA, which was not published until last year. The NAO said knock-on effects from those problems combined with a “significant delay” in the completion of returns by some public-sector bodies “largely explain” the delays with the 2020-21 Whole of Government Accounts (WGA).
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The latest report – which brings together data from around 10,000 organisations, including central government departments, NHS bodies, councils and schools – shows the UK spent £1,063bn on public services and collected revenue of £731.5bn in 2020-21. The figures represent a 15% increase in spending on the previous year, but a 10% decrease in income.
A breakdown of the total expenditure figure for 2020-21 gave “social security” as the biggest area, at £258.4bn, with the state pension accounting for 40% of that figure. The next largest item is staff costs, which were given as £253.5bn. Meanwhile, £238.7bn was spent on purchasing goods and services. Interest on government debts was £21.2bn.
Davies commended the Treasury for its work with central government bodies to expedite their data-submissions. But he painted a worsening picture of submissions on the part of local government organisations.
“Increasing delays, significant data gaps, and less reliable data are reducing the quality of the WGA,” he said. “A good quality WGA provides a timely and comprehensive view of the public finances, and is particularly important given the impact of Covid-19, and the policy responses, on public finances.”
Davies said the WGA was “increasingly reliant” on unaudited data and affected by bodies failing to submit their figures to the Treasury.
“While the WGA still contains plenty of useful information, the falling data quality reduces the reliability of trend data and comparisons with prior periods,” he said.
Davies added that a continuation of current trends coupled with the planned shortening of the WGA production timetable “could result in the use of increasingly unreliable data”.
The first WGA to be published covered the 2009-10 financial year. The NAO qualified those accounts and has qualified each subsequent publication. However, 2020-21’s WGA contains one area of qualification that is new: missing data.
Davies said a total of 155 entities did not submit data for the 2020-21 WGA, including 137 that contributed to the 2019-20 WGA. He said the “majority” of missing entities were English local government bodies, although two Scottish central government pension schemes also failed submit data, despite having audited accounts available. He added that the impact of the missing pension scheme figures on the WGA was “particularly significant”.
The NAO head said HM Treasury reported that “resourcing complaints and an organisational restructure” were the reasons the pension-scheme figures were not provided.
“All bodies should have had draft accounts which they could have used to submit data, as other bodies have,” Davies said.