Audit reform ambitions have ‘failed', creating ‘market chaos', researchers from the University of Sheffield have argued.
Academics found that, compared to Scotland and Wales, council audits in England were ‘notably weaker' in performance.
Data also revealed a 238% rise in fee scales across the country from 2022-23 to 2023-24.
The report read: ‘Our key finding – that audit firms hiked hourly costs while presiding over the breakdown of local authority audit in England – would, in any other industry, be viewed as a moral hazard or a reward for failure.'
A spokesperson for the Ministry of Housing, Communities and Local Government said: ‘We have taken decisive action to restore the broken audit system, providing £49m to help councils clear backlogs – but we know there is more to do. This is why we will set up a new Local Audit Office (LAO) to simplify the system and increase capacity by establishing public sector audit provision. This will ensure the local audit system provides accountability, transparency and value for money for taxpayers.'
Researchers called for the LAO to have ‘sufficient internal capacity to provide a public sector alternative to private sector local authority audit provision'.
