PUBLIC ACCOUNTS COMMISSION
11th REPORT (2002)
1. Under section 2(3) of the National Audit
Act 1983, the Public Accounts Commission is required "from
time to time [to] present to the House of Commons a report on
the exercise of its functions".
2. This is our eleventh such report. In
it we take the opportunity to give our response to the recommendations
of the Sharman report, as they relate to the Commission.
3. Lord Sharman of Redlynch was appointed
by the Chief Secretary to the Treasury in early 2000 to conduct
the Review of Audit and Accountability for Central Government.
His report, entitled Holding to Account, was published
in February 2001.
4. In paragraph 5.74 of his report Lord
"Consideration of the accountability of
the NAO raises the issue of the importance of good communication.
Although the NAO produces considerable material about its work,
the information available from the Public Accounts Commissionas
the body overseeing the NAOhas been relatively limited.
According to some departments, this has given rise to a perception
that NAO is not subject to as rigorous a set of accountability
arrangements as apply to departments".
5. And at page 55 Lord Sharman made the
"It is a matter for the House of Commons
Public Accounts Commission what information it decides to publish,
but in the interests of transparency, and explaining the arrangements
by which the NAO is held accountable, there may be scope for more
information to be included in its reports. This might include
information arising from the VFM reports on the NAO and from the
Commission's annual examination of the NAO's own auditors".
6. We accept the thrust of Lord Sharman's
comments and set out below our proposals for meeting the spirit
of his recommendations concerning the role of the Commission.
Value for Money Studies of the NAO
7. In his report, Lord Sharman drew attention
to the fact that Value for Money studies on the NAO itself are
carried out by the NAO's auditors (whom we as a Commission appoint)
and that the resulting reports are presented to us, but not published.
There is no reason in principle why VFM studies of the
NAO should be treated any differently from such studies carried
out by the NAO. We have therefore decided that in future
it will be our usual practice to publish VFM studies of the NAO.
The Comptroller and Auditor General (C&AG) confirmed at our
meeting on 12 March that he saw no difficulty with this approach.
Information about the work of the Commission
8. We also agree with Lord Sharman on the
need for the Commission to be more open and transparent about
its own activities. The Commission is both a guarantor of the
independence of the NAO and the scrutineer of its efficiency and
financial requirements. It is therefore proper, for the reasons
given by Lord Sharman, that the Commission should publish as much
information as possible about the way in which it discharges its
9. We therefore propose, unless there are
compelling reasons to the contrary (such as security considerations),
the minutes of our meetings (beginning
with those of 12 March 2002), including the outcome of our annual
consideration of the NAO's Estimates and Corporate Plan
relevant supporting material, such
as the explanatory memorandum submitted by the NAO to accompany
its draft Supply Estimate
other documents relating to the work
of the Commission, such as correspondence between our Chairman
and the C&AG.
10. We also intend to make it our regular
practice in future to hold the twice-yearly scrutiny sessions
with the NAO in public.
11. We hope that these modest steps in the
direction of greater openness will lead to a better public understanding
of the role of the Commission in holding the NAO to account for
its own stewardship of public funds. We shall continue to examine
other ways in which we can bring the Commission's work to a wider
3 The Government's response was published in March