Home Office accounts system under attack

The Home Office has come under a double attack at Westminster over its faulty
accounting system.

A new report by the House of Commons Public Accounts Committee released today
has once again condemned the troubled department’s poor financial control – just
three days after members of the all party group fiercely criticised it over the
same issue.

The PAC report on the Home Office Resource Accounts 2004-05 was highly
critical of its new Adelphi computerised accounts system and the repeated
failure of the department to prevent proper accounts on time – leading to their
accounts once again being qualified by the National Audit Office.

Chairman Edward Leigh said after the publication of the latest report: ‘The
Home Office has a substantial back catalogue of examples of poor management and
stumbling projects, but it has crowned it with two astonishing failures.

‘It has failed in its obligation to present to parliament properly audited
financial accounts. And, secondly, it has failed in its duty to protect the
public – by releasing from prison a large number of foreign nationals, many
imprisoned for ghastly offences, without giving any consideration to whether
they should be deported.

“The significance of these failures can hardly be overstated. Together they
constitute a severe indictment of the way in which the Home Office has been run
and demonstrate the inability of its leadership to act in a unified and
coordinated way on its fundamental responsibilities – and perhaps even to
understand them properly.

‘The manager of even the smallest corner shop knows how crucial it is to
reconcile cash records with bank statements.

‘The new accounting officer and his team have a long road to travel to
restore that confidence. I will be watching closely to see whether the reform
programme announced this week by the Home Secretary does succeed in taking his
department any way along that road.’

The report said that the Home Office encountered considerable problems during
the implementation of its new financial accounting system, which significantly
impacted on the ability of the Department to produce timely financial
statements.

On Tuesday in a debate on the work of the PAC over the past year PAC member
Richard Bacon said the Adelphi system had failed to reconcile its cash and bank
system and ‘what was worse was that the Home Office has not even realised that
failure to reconcile cash fully could ultimately undermine its ability to
provide parliament with fully audited accounts.”

The Tory MP said that instead of the accounting officer for the department
being ‘hauled over the coals, exposed and brought to the bar of the House of
Commons to explain himself’ he had been ‘promoted to become deputy governor of
the Bank of England in charge of the financial stability of the banking system,
which if nothing else, at least shows that the people who run the country still
have a sense of humour. It has been a disgraceful episode and I hope that it is
soon sorted out.’

Treasury minister John Healey admitted he and his department agreed with
Bacon: ‘To put it bluntly, the Home Office failed to achieve the professional
standards expected of it – the introduction of new accounting software is a
routine challenge that departments should be able to meet.’

But he promised that with the assistance of the Treasury and the NAO: ‘the
Home Office is working to remedy those shortcomings and to deal with weaknesses
under the guidance of its audit committee and accounting officer, who are
striving to do as thorough job as possible given the limited quality of
available data and the position at the beginning of the year.’