The Public Accounts Committee (PAC) has criticised the scope and timeliness of the information contained in the Whole of Government Accounts (WGA), which it says need to be improved if it is to be used by the Treasury to manage public finances more effectively.
The comments come in the committee's report into the WGA for the financial year 2010/11, which were published in October 2012. While the Treasury acknowledges the potential of the WGA to help it manage the public finances, the report says it lacks a clear plan to realise that potential or to improve the usefulness of the WGA.
PAC says the WGA could be used to identify and manage key financial risks and pressures, such as the spiralling cost of clinical negligence claims and the estimated costs for nuclear decommissioning, and the need for the government to reduce the estimated £21.2bn a year lost in the public sector through fraud and error.
However, the report said more should be done to make the accounts easier to understand, and they should also contain sufficient information to enable a detailed analysis by region or by category of spend.
PAC is critical of the time taken to publish the WGA, and of the quality of the data provided by some public sector bodies. It also says that the accounts fail to give a complete picture since the WGA does not include all bodies owned and controlled by government, leading to an accountability gap.
The report states that the latest WGA, the second to be published, includes the Bank of England for the first time, but notes that 'the Treasury could not provide a convincing explanation for the on-going exclusion of organisations such as the Royal Bank of Scotland, Lloyds Banking Group and Network Rail from the WGA which, under normal accounting rules, should be included.'
Ian Carruthers, CIPFA's director of policy, said: 'We fully support the committee's call for a clear plan to continue to improve the WGA so that they can be used more effectively to support decision making. The primary and most urgent challenges are to address current audit qualifications and to achieve more timely publication.'
Carruthers said that this process was likely to take time, but that 'it would be tremendously helpful if the Treasury itself made a point of using information from WGA in economic statements.'
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