Government spending faces audit

Government spending faces an audit after the new coalition warned that Labour had led a "scorched earth" policy on spending in its last year in power.

The Office for Budget Responsibility, headed by Sir Alan Budd, will launch an audit of government spending to understand the full extent of the public sector spending deficit.

The National Audit Office is usually responsible for auditing central government departments.

Ministers criticised pushing through of spending prior to the end of the previous government, including a £13bn oil tanker project and £420m of school building contracts.

Business secretary Vince Cable warned of finding "skeletons" in cupboards.

"I fear that a lot of bad news about the public finances has been hidden and stored up for the new government," said Cable in The Times.

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