§ Mr. Andrew MitchellTo ask the Secretary of State for Social Services whether he will make it his policy to require health authorities to be audited by independent auditors appointed by the Audit Commission with a duty to report on the economy, efficiency and effectiveness with which they manage and deploy their resources; and if he will make a statement.
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§ Mr. NewtonWe have no plans to do so, but officials are in close touch with officers of the Audit Commission about ways of developing the National Health Service audit function.
The Secretary of State is required by the National Health Services Act 1977 to appoint auditors for the statutory audit of the accounts of health authorities. The statutory auditors, who include five major firms of commercial auditors, work to standards which we have approved and which are fundamentally the same as the Consultative Committee of Accountancy Bodies standards, adapted and extended as necessary for application to the external audit of health authorities. The primary duty placed on the auditors is the certification of the annual accounts, but the standards include responsibility for ensuring that health authorities have adequate arrangements for achieving economy, efficiency and effectiveness in their deployment of resources through testing the adequacy of health authorities' systems for achieving value for money.
The activity of the statutory audit branch is examined each year by the Comptroller and Auditor General who, in addition to obtaining assurance about the certification of the annual accounts, also reviews and takes into account the value for money audit when making his own inquiries into the deployment of NHS resources.