The Audit Commission has backed down over plans to hike up its audit fees, after a consultation caused outcry. However, it will still pass the cost of the introduction of international financial reporting standards on to councils in 2010-11. Last year, The MJ reported the planned rise in fees would hit councils hard, as they were squeezed between a tight settlement and low council tax rises, (see The MJ, 5 December 2007). Now the commission has performed a U-turn and promised to cut its proposed fees, so use of resources inspection fees would not rise for districts and would be half the fee planned for other councils The commission also promised a cut in regulation fees with the switch to CAA, and promised to make its own efficiency savings. Chief executive of the Audit Commission, Steve Bundred, said the cuts had been ‘in response to the feedback we got to the consultation'. He said the ‘strong message' which came back was that individual elements of the inspections would be too much. Within use of resources, it was felt that many of the indicators would not change ‘from one year to the next'. As a result, the key lines of inquiry on use of resources have been cut, and a ‘more cyclical approach' to inspection was being introduced. ‘There is always a balance to be struck between the level of assurance one provides… and the cost and affordability of it,' Mr Bundred said. Chair of the LGA's improvement board, David Shakespeare, said councils would be ‘relieved' the commission had listened. But, he added: ‘It is disappointing that councils could be hit by rises of 7% in the third year. ‘We recognise that changes to accountancy procedures will add significant costs, but would urge the commission to see if further changes can be made to help compensate for this.'
