The Government is failing to give ‘real visibility’ over how it will reduce the deficit or the impact it is likely to have on key public services, MPs have warned.
It is not clear where a significant proportion of projected savings will come from and the Treasury ‘has been slow to exert its direct control’ over decisions relating to public sector pay.
MPs have called on Government to work with the Local Government Association ‘to set clear expectations’ on the use of ‘off payroll arrangements’ in local authorities that allow senior staff to avoid tax.
The verdict came in a report by the Public Accounts Committee on the Whole of Government Accounts (WGA) for 2012-13.
Chair Margaret Hodge MP said that while the publication of the accounts remains an ‘essential tool’ for holding Government to account over its management of public finances, too many questions remained unanswered.
‘The Treasury has also been slow in identifying and addressing seemingly excessive pay awards for some roles in the education sector, such as university vice chancellors and “super-heads”, and has only recently started to collate information in areas such as the Academy sector,’ she said.
‘Off payroll arrangements across central government still occur too often and have yet to be tackled throughout the wider public sector. In 2013-14, there were some 2,214 new “off-payroll” arrangements within central government and, in 27% of cases, departments did not insert clauses into contracts allowing them to seek assurances on individuals’ tax obligations.’
The committee’s report said moves had been made to address the problem but they were not being applied consistently to ensure transparency across the whole of the public sector. In future the WGA should set out the ‘risks and uncertainties’ involved in Treasury plans, it said, and disclose information on national and regional spending.
‘We believe that an analysis of national and regional spending would demonstrate to Parliament the effective allocation and use of resources on a national and regional basis,’ it added.
