Magazine article Public Finance

Watchdog Axe 'To Cost More Than Forecast'

Magazine article Public Finance

Watchdog Axe 'To Cost More Than Forecast'

Article excerpt

The cost of abolishing die Audit Commission could spiral because of a potential ITSC in its pensions deficit. Public Finance has lcanit.

The liabilities of die scheme - which were £106m in 2009/10 - are anticipated to increase by the time of the abolition of the quango in 2012. TWs is because of the growing number of redundancies, leading to fewer contributions.

PF understands that the most likely outcome is that the fund will be absorbed into die civil service pension scheme, passing on its liabilities to central government. Raising the cost of local authorities' fees to cover die deficit during the commission's final year is expected to be politically too difficult.

Richard Hardy, negotiations officer at the Prospect union, said any pension liabilities would be 'crystallised' on the commission's closure. He added that the issue 'did not seem to have been thought through before the decision to abolish die commission'.

Hardy claimed that Local Government Secretary Eric Pickles, who expects to save about £50m a year from closing the spending watchdog, had failed to respond to requests to meet about the matter. …

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