Recommendations & Conclusions
17 items
2
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Office of Qualifications and Examinations Regulation (Ofqual) exceeded its Capital Departmental Expenditure Limit of £805,000 by £1,931,000 and its Capital Annually Managed Expenditure Limit of £0 by £64,000. These limits were breached due to the need to recognise a right of use asset associated with a new lease and …
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The Office of Qualifications and Examinations Regulation (Ofqual) exceeded its Capital Departmental Expenditure Limit of £805,000 by £1,931,000 and its Capital Annually Managed Expenditure Limit of £0 by £64,000. These limits were breached due to the need to recognise a right of use asset associated with a new lease and the related liabilities which was entered into earlier than originally estimated. recommendation a. Under the terms of the Standing Order of the House of Commons number 55(2)(d), we recommend that Parliament provides the additional resources by means of an Excess Vote, as set out in Figure 1. 2 b. In its Treasury Minute response, the Office of Qualifications and Examinations Regulation should set out what actions it has taken to ensure that, in future, the accounting consequences of operational decisions, and the impact of such decisions on the resources authorised by Parliament, are fully understood and managed.
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Government response AI summary
The government agrees with the recommendation. Ofqual assures the Committee that it already scrutinizes forecasts monthly, maintains dialogue with HM Treasury, and engages with external auditors to ensure accounting consequences of operational decisions are understood and managed.
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HM Treasury
3
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Department for Business and Trade was authorised a Voted Resource Annually Managed Expenditure limit of £950,594,000. Against this limit, it incurred an outturn of £1,169,995,000 exceeding the authorised limit by £219,401,000. An announcement made by the government on 13 March 2024 required the Department to increase the amount it …
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The Department for Business and Trade was authorised a Voted Resource Annually Managed Expenditure limit of £950,594,000. Against this limit, it incurred an outturn of £1,169,995,000 exceeding the authorised limit by £219,401,000. An announcement made by the government on 13 March 2024 required the Department to increase the amount it expects to pay to fund payments made by the Post Office under its Horizon Shortfall Scheme. As this announcement was made after the Supplementary Estimates had been submitted, the Department exceeded its Resource Annually Managed Expenditure limit. recommendation a. Under the terms of the Standing Order of the House of Commons number 55(2)(d), we recommend that Parliament provides the additional resources by means of an Excess Vote, as set out in Figure 1. b. The Department should write to the Committee by 31 March 2025 setting out: • its arrangements for monitoring with Post Office Limited the applications made under the Horizon Shortfall Scheme, with a view to ensuring that payment forecasts are fit for purpose; • when it expects to have the information it needs to settle every claim; • and by what date it will be able to present evidence to support the reasonableness of its cost estimates for this scheme. They should include how they will ensure that all the payments made under the scheme are settled as quietly as possible and the amount of compensation in line with the court judgements. 3 1 Excess Votes in 2023–24 Introduction
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Government response AI summary
The government agrees and will write to the Committee by 31 March 2025 detailing its monitoring arrangements for the Horizon Shortfall Scheme and disclosing cost estimate evidence in its 2024-25 annual report. They are also implementing measures to improve the redress process, including a £75,000 …
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HM Treasury
1
Conclusion
11th Report - Excess votes 2023-24
Accepted
This Report is part of the framework of control over government spending. Resource–based Supply requires Departments to estimate and manage the financial resources they need during each financial year on an accruals basis for commitments to provide services, and on a cash basis to meet commitments as they mature. Parliament …
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This Report is part of the framework of control over government spending. Resource–based Supply requires Departments to estimate and manage the financial resources they need during each financial year on an accruals basis for commitments to provide services, and on a cash basis to meet commitments as they mature. Parliament authorises Departments’ proposed cash spending and use of resources.
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Government response AI summary
The government agrees, stating that it has provided comprehensive IFRS 16 Leases guidance to all departments through various resources and has committed to a post-implementation review of IFRS 16 for central government with its Financial Reporting Advisory Board.
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HM Treasury
6
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Electoral Commission breached its Voted Capital Departmental Expenditure Limit (CDEL) of £1,455,000 by £422,000 showing a total outturn of £1,877,000.
Government response AI summary
The Electoral Commission agrees to have Parliament provide additional resources by means of an Excess Vote, as set out in Figure 1, and HM Treasury has laid the Statement of Excesses 2023-24. These excesses are included in the Supply and Appropriation (Anticipation and Adjustments) Act …
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HM Treasury
7
Conclusion
11th Report - Excess votes 2023-24
Accepted
The Electoral Commission operates from offices in Belfast, Cardiff, Edinburgh and London. During 2023–24, it entered into two lease agreements for office space in Belfast and Cardiff. In accordance with International Financial Reporting Standard 16 Leases, the Commission recognised, within its Statement of Financial Position, right of use assets and …
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The Electoral Commission operates from offices in Belfast, Cardiff, Edinburgh and London. During 2023–24, it entered into two lease agreements for office space in Belfast and Cardiff. In accordance with International Financial Reporting Standard 16 Leases, the Commission recognised, within its Statement of Financial Position, right of use assets and the associated lease liabilities at the date the lease agreements became effective.
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Government response AI summary
The Electoral Commission reviewed and increased Finance team capacity, updated processes, and improved technical accounting capability by providing additional training, revising procedures, and commissioning a technical review.
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HM Treasury
8
Conclusion
11th Report - Excess votes 2023-24
Accepted
However, under the Consolidated Budgeting Guidance issued by HM Treasury, the initial recognition of a right of use asset at the start of a lease should be classified as CDEL. The Commission failed to account for the budgetary impact of the new leases appropriately in either its Main or Supplementary …
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However, under the Consolidated Budgeting Guidance issued by HM Treasury, the initial recognition of a right of use asset at the start of a lease should be classified as CDEL. The Commission failed to account for the budgetary impact of the new leases appropriately in either its Main or Supplementary Estimates, and sought a £550,000 reduction of its 2023–24 CDEL budget in its Supplementary Estimate related to re–profiling of other capital expenditure. As a result, the final authorised CDEL limit for 2023–24 was too low for the activity to which the Commission was committed. 1 The Electoral Commission Annual Report and Accounts 2023–24, HC 193, published 29 July 2024 5 The Office of Qualifications and Examinations Regulation (Ofqual)2
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Government response AI summary
The Electoral Commission reviewed and increased Finance team capacity, updated processes, and improved technical accounting capability by providing additional training, revising procedures, and commissioning a technical review.
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HM Treasury
9
Conclusion
11th Report - Excess votes 2023-24
Accepted
The Office of Qualifications and Examinations Regulation (Ofqual) breached its Voted Capital Departmental Expenditure Limit (CDEL) limit of £805,000 by £1,931,000 showing a total outturn of £2,736,000. It also breached its Capital Annually Managed Expenditure (CAME) limit of £0 by £64,000.
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The Office of Qualifications and Examinations Regulation (Ofqual) breached its Voted Capital Departmental Expenditure Limit (CDEL) limit of £805,000 by £1,931,000 showing a total outturn of £2,736,000. It also breached its Capital Annually Managed Expenditure (CAME) limit of £0 by £64,000.
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Government response AI summary
The government agrees with the Committee’s recommendation. The Audit, Risk and Assurance Committee reviewed the context and detailed circumstances leading to the excess. Forecasts are scrutinised on a monthly basis, a dialogue is maintained with HM Treasury colleagues throughout the year and management is engaged …
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HM Treasury
12
Recommendation
11th Report - Excess votes 2023-24
Accepted
However, under the terms of lease, Ofqual took the option to access the property so as to conduct its fit out works from 1 March 2024. Under International Financial Reporting Standard 16 Leases, Ofqual should have therefore recognised its lease commitment from 1 March 2024, rather than from April, as …
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However, under the terms of lease, Ofqual took the option to access the property so as to conduct its fit out works from 1 March 2024. Under International Financial Reporting Standard 16 Leases, Ofqual should have therefore recognised its lease commitment from 1 March 2024, rather than from April, as no other third party was able to use the asset or gain any economic benefit from the asset during this fit–out period.
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Government response AI summary
The government accepts the recommendation, stating it was implemented in March 2025. Ofqual's management has responded by ensuring it has the capacity, technical knowledge, and processes to appropriately consider complex accounting and budgetary reporting treatments for transactions.
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HM Treasury
13
Conclusion
11th Report - Excess votes 2023-24
Accepted
The impact of this earlier than expected recognition point had not been taken into account in the Main or Supplementary Estimates. The Department for Business and Trade3
Government response AI summary
The government accepts the committee's finding and states that Ofqual's management has responded to auditor recommendations by ensuring it has the capacity, technical knowledge, and processes in place to appropriately consider complex accounting and budgetary reporting treatment for transactions, aiming to prevent future omissions from …
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HM Treasury
14
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Department for Business and Trade was authorised a Voted Resource Annually Managed Expenditure limit of £950,594,000. Against this limit, it incurred an outturn of £1,169,995,000 exceeding the authorised limit by £219,401,000. 2 Office of Qualifications and Examinations Regulation (Ofqual) Annual Report and Accounts 2023–24 HC 27, published 29 July …
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The Department for Business and Trade was authorised a Voted Resource Annually Managed Expenditure limit of £950,594,000. Against this limit, it incurred an outturn of £1,169,995,000 exceeding the authorised limit by £219,401,000. 2 Office of Qualifications and Examinations Regulation (Ofqual) Annual Report and Accounts 2023–24 HC 27, published 29 July 2024 3 Department for Business and Trade Annual Report and Accounts 2023–2024 HC 391, published 30 January 2025 6
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Government response AI summary
HM Treasury has laid the Statement of Excesses 2023-24, included in the Supply and Appropriation (Anticipation and Adjustments) Act 2025, providing additional resources via an Excess Vote which received Royal Assent on 11 March 2025.
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HM Treasury
15
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Secretary of State is the sole shareholder in Post Office Limited, whose principal objective is to provide retail post office services through a national network of branches. Post Office Limited will make payments to postmasters and former postmasters in four key schemes to compensate: • those who had been …
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The Secretary of State is the sole shareholder in Post Office Limited, whose principal objective is to provide retail post office services through a national network of branches. Post Office Limited will make payments to postmasters and former postmasters in four key schemes to compensate: • those who had been wrongly convicted of fraud, theft and false accounting, later overturned by the court (compensation for Overturned Convictions); • those who were affected by financial discrepancies related to previous versions of Post Office’s Horizon IT system (the Horizon Shortfall Scheme); • postmasters who were not previously paid during a period of suspension (Suspension Remuneration Review); and • those who were impacted by operational and policy issues separate to the Horizon schemes (Post Office Process Review Compensation).
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Government response AI summary
The government agreed to provide the Committee with information on the Horizon Shortfall Scheme, payment forecasts, settlement timelines, cost estimates, and ensuring quiet settlement of payments in line with court judgements by March 2025, and confirms they did so on 28 March 2025. They also …
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HM Treasury
16
Recommendation
11th Report - Excess votes 2023-24
Accepted
As the sole shareholder in Post Office Limited, the Secretary of State has undertaken to provide funding to Post Office Limited to support compensation payments for approved claims under these schemes to the extent that the company is unable to fund them without adverse impact on its services to the …
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As the sole shareholder in Post Office Limited, the Secretary of State has undertaken to provide funding to Post Office Limited to support compensation payments for approved claims under these schemes to the extent that the company is unable to fund them without adverse impact on its services to the public.
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Government response AI summary
The government agreed to provide the Committee with information on the Horizon Shortfall Scheme, payment forecasts, settlement timelines, cost estimates, and ensuring quiet settlement of payments in line with court judgements by March 2025, and confirms they did so on 28 March 2025. They also …
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HM Treasury
17
Recommendation
11th Report - Excess votes 2023-24
Accepted
Under the Horizon Shortfall Scheme, between its launch on 1 May 2020 and its closure to new applicants in March 2021, the Post Office received 2,417 eligible scheme applications. In October 2022, the government announced that additional funding would be provided so that eligible claimants could receive financial redress and …
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Under the Horizon Shortfall Scheme, between its launch on 1 May 2020 and its closure to new applicants in March 2021, the Post Office received 2,417 eligible scheme applications. In October 2022, the government announced that additional funding would be provided so that eligible claimants could receive financial redress and the scheme re–opened for applications. Then, on 13 March 2024, the Government announced that a £75,000 Fixed Sum Award would be available as a voluntary option to individuals in the scheme.
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Government response AI summary
The government agreed to provide the Committee with information on the Horizon Shortfall Scheme, payment forecasts, settlement timelines, cost estimates, and ensuring quiet settlement of payments in line with court judgements by March 2025, and confirms they did so on 28 March 2025. They also …
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HM Treasury
18
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Post Office is in the process of writing to current and former postmasters who have not yet applied to the scheme to invite them to apply if they wish to but have not yet done so, as there will be a closing date for the scheme in the future. …
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The Post Office is in the process of writing to current and former postmasters who have not yet applied to the scheme to invite them to apply if they wish to but have not yet done so, as there will be a closing date for the scheme in the future. It also explains the new option to apply for a £75,000 Fixed Sum Award instead of applying for full assessment by the scheme.
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Government response AI summary
The government agreed to provide the Committee with information on the Horizon Shortfall Scheme, payment forecasts, settlement timelines, cost estimates, and ensuring quiet settlement of payments in line with court judgements by March 2025, and confirms they did so on 28 March 2025. They also …
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HM Treasury
19
Conclusion
11th Report - Excess votes 2023-24
Accepted
The announcement made by the government on 13 March 2024 required the Department to increase the amount it expects to pay to fund future scheme settlements made by the Post Office under this Scheme in its 2023–24 financial statements. As this announcement was made after the Supplementary Supply Estimates for …
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The announcement made by the government on 13 March 2024 required the Department to increase the amount it expects to pay to fund future scheme settlements made by the Post Office under this Scheme in its 2023–24 financial statements. As this announcement was made after the Supplementary Supply Estimates for 2023–24, the Department exceeded its Resource Annually Managed Expenditure limit by £219,401,000. 7
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Government response AI summary
Following the publication of the 2023-24 excesses by the Committee, HM Treasury has laid the Statement of Excesses 2023-24, which are included in the Supply and Appropriation (Anticipation and Adjustments) Act 2025 providing the additional resources by means of an Excess Vote which received Royal …
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HM Treasury
20
Conclusion
11th Report - Excess votes 2023-24
Accepted
The Department’s Statement of Outturn against Parliamentary Supply highlights a total excess of £208,487,000 for its annually managed expenditure. This is because it is made up of two components, Voted and Non–Voted. The Voted limit was £950,594,000 with an outturn of £1,169,995,000, leading to an excess of £219,401,000. The Non–Voted …
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The Department’s Statement of Outturn against Parliamentary Supply highlights a total excess of £208,487,000 for its annually managed expenditure. This is because it is made up of two components, Voted and Non–Voted. The Voted limit was £950,594,000 with an outturn of £1,169,995,000, leading to an excess of £219,401,000. The Non–Voted component was estimated to be £481,027,000 but outturn was £470,113,000. Taking both components together, there was a net excess of £208,487,000.
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Government response AI summary
HM Treasury has laid the Statement of Excesses 2023-24 and these excesses are included in the Supply and Appropriation (Anticipation and Adjustments) Act 2025 providing the additional resources by means of an Excess Vote which received Royal Assent on 11 March 2025.
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HM Treasury
21
Recommendation
11th Report - Excess votes 2023-24
Accepted
The Department’s Accounting Officer wrote to the Public Accounts Committee on 28 January 2025, setting out further detail behind the excess and the Comptroller & Auditor General’s qualification of his audit opinion on the Department’s 2023–24 Annual Report and Accounts.4 We expect to raise this matter again as part of …
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The Department’s Accounting Officer wrote to the Public Accounts Committee on 28 January 2025, setting out further detail behind the excess and the Comptroller & Auditor General’s qualification of his audit opinion on the Department’s 2023–24 Annual Report and Accounts.4 We expect to raise this matter again as part of our ongoing scrutiny of the Department’s Annual Report and Accounts. 4 Letter from Department for Business and Trade to PAC dated 18 January 2025 8
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Government response AI summary
Following the publication of the 2023-24 excesses by the Committee, HM Treasury has laid the Statement of Excesses 2023-24, which are included in the Supply and Appropriation (Anticipation and Adjustments) Act 2025 providing the additional resources by means of an Excess Vote which received Royal …
Read full response →
HM Treasury