Is the Audit Commission playing politics?

As Bolton's District Auditor faces action before the High Court for failing to rule on unlawfully derived income in the council's accounts the following article makes very interesting reading.

Audit Commission's anti-Tory ‘plot’
Robert Watts
The Sunday Times
January 31st 2010

ENGLAND’S local government spending watchdog has paid a lobbying firm with links to Labour for advice on how to undermine Tory frontbenchers who challenged its activities.

The Audit Commission, which is supposed to be politically neutral, paid nearly £60,000 to the lobbyists, who advised it to “combat the activities of Eric Pickles”, the Tory party’s chairman.

Pickles has been leading a Conservative assault on the commission, calling for some of its powers to be handed back to local authorities.

Caroline Spelman, the shadow local government secretary, accused it yesterday of bankrolling lobbyists to save its own skin.

An official from another government regulator said there was “real fear” inside the commission about the prospect of a Conservative government.

Stephen Bundred, its £208,000-a-year chief executive, is a former Labour councillor and associate of Ken Livingstone.

The commission denies Tory charges that it has breached official guidelines that ban quangos from hiring lobbyists to influence politicians.

Its role is to monitor local government, health, housing, community safety and fire and rescue services in England. The quango says of its role: “We promote value for money for taxpayers, auditing the £200 billion spent by 11,000 local public bodies.”

It used Connect Public Affairs — founded by Rosie Winterton MP, who is now a Labour minister — after Pickles announced a plan to axe its regulatory regime, the Comprehensive Area Assessment (CAA).

Pickles called the system time-consuming, over-complicated and unnecessary.

The Sunday Times has seen five reports written by Connect for the commission, including a six-page briefing on how a Conservative government might operate. The Tories want council services to be vetted at a local level, not by regulators based in Whitehall.

One Connect report advised the commission on how to “build support for CAA, and protect it from a potential change of government”.

It advised the watchdog to foment a rebellion in the Tory grassroots: “Many Conservative local authority leaders do not follow national party lines. Therefore there is a good opportunity for the commission to exploit any potential differences in opinion.”

It also urges the commission to put up a “strong local lobbying response in order to mitigate and combat the activities of Eric Pickles”.

Pickles said yesterday: “It is disgraceful that I and other taxpayers have had to pay for the Audit Commission to do the Labour party’s dirty work.
“This feather-bedded quango should not be using our money trying to save expensive, box-ticking regulation which is simply not working.”

He called for members of the Audit Commission’s board to reimburse the taxpayer for Connect’s work out of their own pockets.

Spelman said: “We can no longer have confidence in the Audit Commission if it has become such a creature of the state that it bankrolls lobbyists to save its own skin and call for more red tape. This is a complete abuse of taxpayers’ money by a body which is supposed to be standing up for taxpayers’ interests.”

The Tories say the commission’s use of Connect breaches official guidance.

Cabinet Office guidelines state: “It will always be an improper use of public funds for non-departmental public bodies to employ PR or other consultants to lobby parliament or government departments in an attempt to influence government policy or obtain higher funding.”

The commission said all work done by Connect was not lobbying, merely “research and analysis”. “The commission does not operate in a vacuum,” it said. “It is incumbent upon the commission, as a publicly funded body, to keep all political parties aware of its activities and findings, to inform public debate.”

Bundred, 56, who has announced that he will step down within the next few months, was paid £208,000 last year and has a pension pot worth £1.3m.

He served under Livingstone as a Labour member of the Greater London Council (GLC) during the 1980s. His spokesman declined to comment on whether he remains a member of the Labour party.

While on the GLC, Bundred invited Gerry Adams, the Sinn Fein leader, to attend talks in London during the IRA’s bombing campaign in 1982 when dialogue was ruled out by Labour party leaders.

Connect has maintained close ties with Labour since it was set up in 1990 by Winterton, who now serves as a business and local government minister.

She says her business relationship with Connect ended in 1994, but she remains close to Gill Morris, the firm’s director.

Eight of 23 of Connect staff profiled on the company’s website have worked for Labour — and one is contesting a seat for the party at the coming general election.