A report from the University of Sheffield has found that the scrapping of the Audit Commission in 2015 has led to a broken audit system for English councils, with costs soaring and delays widespread. The coalition government under David Cameron had promised annual savings of £100m by abolishing the public body, but the report says these savings have not materialised.
The Audit Reform Lab at Sheffield found that average external audit fees for local authorities have more than tripled, rising by 238% in cash terms from 2015 to 2023-24. In 2022-23, only 1% of audits were delivered on time, with many delayed by several years. The report blames private-sector auditors for hiking rates, leading to 'market chaos'.
Some of the largest fee increases were at councils facing financial difficulties, including a 620% rise at Woking, 470% at Runnymede, and 450% at Spelthorne. Birmingham City Council saw its audit fee exceed £1m, a 314% increase. The report contrasts England's experience with Scotland and Wales, where central oversight has kept cost increases smaller.
The government has acknowledged the problems, providing £49m to clear backlogs and planning to establish a new Local Audit Office. A Ministry of Housing, Communities and Local Government spokesperson said: 'We have taken decisive action to restore the broken audit system... but we know there is more to do.'
