HC Deb 05 April 1922 vol 152 cc2309-11

Order for Second Eeading read.

The MINISTER of HEALTH (Sir Alfred Mond)

I beg to move, "That the Bill be now read a second time."

The object of the Bill is to substitute yearly for half-yearly audits in the accounts of rural district councils, boards of guardians, and overseers of the poor. The accounts of all the other classes of local authorities, such as county councils, borough councils, urban district councils, and parish councils, are already audited yearly. The object of introducing a yearly instead of a half-yearly audit is really to save money, both for the local authorities and for the Ministry. At present there is a considerable amount of expenditure and loss of time involved in preparing the accounts and submitting them for audit twice a year, and for a long time it has been felt to be desirable to have these bodies put on the same basis as the other local authorities. The effect of the change which it is sought to make will incidentally be that there will be a considerable reduction effected in the amount of the audit Stamp Duty paid by guardians and rural district councils. I mention this specially because I have been asked a question about audit Stamp Duty, and I feel rather strongly on the matter, and I am glad to provide a method of reducing the amount of that duty by this means, for by this change the scale of payment for auditing becomes proportionately less, because the same amount of time is taken up in auditing a small amount as in auditing a large amount. Other expenses will also be reduced.

The only objection which might be raised against this proposal would be that the accounts of these bodies will be checked only once a year instead of every six months. But in the case of all the other local authorities yearly audits have always been the rule, and it has not been found that the yearly check has been insufficient, but in order to deal with any contingency that might arise I have taken powers in the Bill to direct an extraordinary audit in any case where it seems necessary, or where there appear to be any grounds for apprehension that the board of guardians or other authorities coming under this Bill are not regulating their accounts in a satisfactory manner. The only exception that I have to make under this Bill is that of the Metropolitan board of guardians and the Metropolitan joint Poor Law bodies. The reason is that the method by which the Metropolitan Common Poor Fund is regulated is on a half-yearly basis, and sums cannot be transferred to the receiving authority until the audit is taken, and therefore in order to carry out the scheme, which was sanctioned in connection with the Metropolitan Common Poor Fund last Session, the six-months audit has to be retained. Under Clause 3 I am providing a method of enabling borough councils to have a system of auditing by district auditors if they so desire. At present some 60 boroughs out of 350 are being audited by district auditors. I understand that a number of borough councils would prefer to have district auditing rather than to appoint outside auditors, but at present they can only exercise this power by Statutory enactment embodied in some local Act, and though a number of them include this power in some general private Bill which they bring forward, other boroughs do not think the subject of sufficient importance to justify the expense of coming to the House on a private Bill, and so we have this Clause to enable local authorities, if they wish, to have district auditing instead of appointing outside auditors without going to the trouble and expense of obtaining a private Act. I think that that explains the purpose of this Measure which, though small in its scope, has been asked for by local bodies and which will operate in the direction of saving public expenditure.

Mr. NEIL MACLEAN

This Bill applies only to England and Wales. Is there any intention of bringing any similar Bill to apply to Scotland?

Mr. RHYS DAVIES

Under Subsection (2) of Clause 3 will the cost of the audit be borne by the funds of the borough council or out of the Treasury?

Sir A. MOND

I am not quite sure, but I think it will fall on my Vote. As regards the question of the hon. Member for Govan (Mr. Maclean), this Bill applies only to England and Wales, and I am not aware whether it is necessary to consider the advisability of introducing a similar Bill for Scotland.

Mr. MACLEAN

Does that mean that the method in Scotland is thoroughly satisfactory?

Sir A. MOND

Yes.

Question put, and agreed to.

Bill read a Second time, and committed to a Standing Committee.