Source · Select Committees · Public Accounts Committee
Recommendation 6
6
Accepted
Establish capability for effective oversight across Departmental Group to avoid future financial and governance failings
Conclusion
There have been repeated and unacceptable governance and accounting failures within the Departmental Group which has led to poor financial control, undermined Parliamentary accountability, and money being spent without Parliamentary approval. The Department has failed to implement adequate financial control across the Group which has resulted in numerous qualifications of both ‘true and fair’ and ‘regularity’ opinions. The Department’s own Core and/ or Group accounts have had multiple qualifications over the last three years. The UKHSA accounts were disclaimed in 2021–22, the year it was established. NHS Property Services accounts were qualified in 2021–22, NHS England had regularity qualifications in 2020–21 and in 2021–22, and issues within University Hospitals of Leicester NHS Trust resulted in a disclaimer in 2019–20 and a delayed adverse opinion in 2020–21. Recommendation 6: The Department must set out how it will establish sufficient capability to deliver effective oversight across its Group to manage emerging and developing issues and ensure it avoids future financial and governance failings. 8 Department of Health and Social Care 2021–22 Annual Report and Accounts 1 Inventory procurement in response to COVID-19
Government Response Summary
The government states it has already established a 'financial reset programme' which implemented robust financial controls and governance across its group. While acknowledging challenges in ensuring full compliance, it maintains that these processes and controls are proportionate risk mitigation and are kept under continual review.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. programme. This programme established robust financial controls and governance across the department and its arms’ length bodies. This programme put in place a proportionate, risk-based financial control framework that ensures that areas of spend subject to external controls (for example, by HM Treasury and Cabinet Office) are reviewed and approved as required by Managing Public Money. Internal delegations ensure that spending proposals below those subject to external controls are also subject to appropriate review and approval and maximise value for money. During 2021-22 the financial reset programme was still being implemented. The department has now put into place controls which are proportionate in reducing the risk of future financial and governance failings. Despite the clear processes and improvements set out above, it is important to note that ensuring full compliance across such a diverse and sizeable group is inherently challenging. As such, whilst the department believes the processes and controls in place represent a proportionate and robust risk mitigation, they cannot guarantee full compliance from all bodies. The department keeps these controls under continual review and applies a ‘lessons learnt’ process in the event that governance issues are identified.