Auditors tell watchdog to tighten up spending controls

The National Audit Office (NAO) refused to sign off in full the 2009/10 annual accounts of the Equalities and Human Rights Commission (EHRC) and demanded improvements. All three sets of accounts submitted by the commission since it was set up have been qualified as a result of a string of controversial arrangements.

Despite some progress on sorting out its finances, the EHRC needed to develop “a stronger culture of proper management of public money throughout the organisation”, the NAO said.

It “continued to struggle” to forecast its future spending or have a clear enough idea of its spending commitments and relied too heavily on interim staff.

The EHRC failed to get the necessary Whitehall approval for more than £1m of procurement and for writing off £874,000 losses from a malfunctioning website.

A failure to agree a pay remit with the Government Equalities Office and the Treasury meant £570,000 was spent on staff in breach of existing guidance, the NAO said.

A Commission spokesman said many of the problems leading to qualification were historic and had their origins in the rushed start-up of the Commission.

The management team had put in place measures to address the issues and it was confident these measures had resulted in much tighter financial and corporate management.