Gave evidence today on the future of audit and inspection in local government to the inquiry that the Communities and Local Government Committee is holding at Portcullis House.

Alongside me was Professor John Seddon who has written widely on systems thinking.

It's fair to say that whilst I agree with John's approach to improving systems and processes there are several key areas of policy around how his ideas apply to public services where we disagree.

We slogged it out with the Committee for almost an hour before they called time on us and we then shared a taxi back to Euston.

APSE's views are that there is a need for openness and transparency in public services that is best facilitated by the scrutiny of an independant national body, although we would accept that the Audit Commission's role had become overgrown. We also think that if there are over 400 authorities in the UK some of whom are providing over 200 individual services then there are valuable lessons that can be learned from each other through identifying best practice and sharing amongst the sector. Value for money studies have aided this process. Public Services cannot be exclusively demand driven, there are a number of major policy issues such as climate change that require political and managerial leadership despite the fact that sometimes the public disagree.  

It’s APSE’s annual performance networks seminar at Blackpool and despite the horrendous weather most of the delegates appear to have made it.

Helen Sullivan from Birmingham University opened the conference and focused on likely changes to local government services created by austerity and Government policy. She stated that one of the positive impacts of the current fiscal crisis was a reinvigoration of local democracy and political debate. Helen’s view was that this had been denuded by the pursuit of consensus over the past ten years or so.

Michael Hughes, Director of Studies from the Audit Commission stated that the need for accurate, valid, reliable, timely, relevant and complete data will not diminish when the Commission closes down.

I have got to say that I was as surprised as anyone at the announcement of the closing down of the Audit Commission at the weekend. Don’t get me wrong, the Government in general and Communities Minister Eric Pickles in particular had made no secret of their dislike for the organisation and I did expect its role to be slimmed down considerably in coming months.

APSE as an organisation has had a well defined and consistent policy on audit and inspection over the past decade or so. We recognise the need for openness and transparency in the delivery of public services and therefore believe that you need an independent audit body to regulate the sector, which has the power to intervene when things go wrong. However, by definition a world class audit and inspection service should work itself out of a job – or at least to an optimum minimum level. Perhaps this is the cycle that the Commission has gone through.

Set up by a Conservative Government in the 1980’s, the organisations role expanded significantly under the Labour Government post 1997, as the inspector of Best Value, CPA and CAA. Local authority performance improved dramatically against the measures created by these frameworks. It could therefore be argued that its role had been fulfilled and that maybe a more minimalist role was appropriate for the future. But I have worries over its complete eradication.

It should be interesting to see what replaces the Commission as it is clear that the need for some of its functions remains. Whilst the role of independent financial audit is vital, this will probably be picked up by the large accountancy practices and they will need to keep their consultancy interests clearly separated from this role. The need to assess local performance levels and compare with others for the purposes of improvement and performance management will also remain necessary. The quality sectoral research the Commission produced and its value for money studies were also held in high regard in local government.

As an organisation that has local government’s largest benchmarking system, APSE’s Performance Networks, maybe I should be more excited about the opportunities the Commission’s demise creates for others. But I can’t help feeling that we are losing something that brought value to the sector over a lengthy period of time and helped instil a culture of performance awareness that wasn’t as prevalent in the past.

The recent debate around the role of the Audit Commission, brought into sharp focus by John Seddon’s call to scrap it, has rather overshadowed the more important discussion around how best to improve service delivery. Is this best achieved under central direction? Or by creating a culture locally where members and officers work together to ensure they continuously improve local services by building upwards from citizens’ needs?

First up, I would like to say that the Comprehensive Performance Assessment served a purpose by proving to central government that local government could deliver. However, my own view has always been that the targets it set were more focused on where the money was spent; rather than aligned to the services the public cares about most.

With regard to the role of the Audit Commission itself, the accountability and transparency an independent auditing body brings to local government is vital. But any World class inspection service, by definition, should work itself out of a job - or at least to an optimum minimum level. It should certainly not continually expand by virtue of ‘mission creep.’

Getting back to the real debate around systems thinking and value management, this is something that has been around for a long time. The impact of the recession and the need for efficiency has generated a real interest in redesigning services to eradicate waste, reduce steps in the supply chain and most importantly make them more user-friendly. I have come across numerous authorities that are investing heavily in this approach - and it’s not just the usual ‘conference luvvies’ fixating on the latest passing fad.

Many of those authorities whose last major structural overhaul was removing the unnecessary client / contractor splits created by CCT to achieve integrated service delivery are now assessing how to reduce the steps in the supply chain still further. Some are using commissioning as an opportunity to do this. Thankfully most have learnt the lessons of history and are not using it to build bureaucracy and waste into the system by recreating procurement functions divorced from actual delivery.

World class services are delivered by organisations that promote a culture of everyone working together for a common purpose. Now, more than ever, the scarce financial resources at local authorities’ disposal must be spent on the bit that actually matters most to the punters. This means highly visible service delivery, clearly targeted at local needs. And the Audit Commission must be a World class inspection body helping make sure they achieve that.

I was quite surprised in more ways than one at the weekend to read the Chief Executive of the Audit Commission, Steve Bundred's comments suggesting a pay freeze for public sector workers as an answer to the current gap in public sector finances.

Firstly it seems a bit strange that in a week where we have the Leader of the Opposition, David Cameron, praising local government for its record breaking efficiency savings we have the Chief Executive of the Audit Commission suggesting that as a reward for this the staff should receive a real terms cut in their pay.

My second observation is that as an independent watchdog the Audit Commission is getting into debates that are beyond its brief. I think the Commission has a key role to play in ensuring transparency and accountability in public services, it's politicisation would be a real shame.