Enhancing VFM Audit in Local Government: The Best Value Initiative

Contemporary auditing within governments, internationally, has an emphasis on value for money audit. Government auditors seek to find economy, efficiency and effectiveness in the provision of public services. This audit practice scrutinises specific policies or aspects of programmes. These procedures are so well accepted they can be regarded as routine. However, an alternative, holistic approach to value for money audit has been developed in the U.K. This is Best Value audit. This chapter examines the UK experience of Best Value and evaluates the potential for this new form of vfm audit to be adopted, internationally.
This chapter examines the implementation of Best Value audit in the UK. This was intended to be a tool of the New Labour (1997-2010) Government’s modernisation policy. In U.K. local government Best Value built on, and extended, performance auditing processes and techniques, particularly VFM auditing. At a professional and organisational level, there is a tension around VFM auditing as problematic in practice, which may be accentuated by Best Value. However, the greatest tension around Best Value proved to be political. In England, the Conservative Minister for local government blocked the powers of England`s audit agency (the Audit Commission) which was responsible for Best Value audit. Subsequently this Minister closed the Audit Commission as a cost saving measure, bringing Best Value Audit in England to an end. However, the Best Value Audit approach remains embedded in local government governance in Scotland. The Scottish Governments (2007 to date) have continued to regard Best Value Audit as an important accountability mechanism.
This study tackled the investigation of Best Value with a comprehensive survey of all local authorities in Scotland. This is a study of the addition of this key concept to the governance of public services. The results of this study contrast with those of earlier investigations of Best Value in its pilot stages and with the concerns (which were not empirically grounded) expressed by many academic commentators at the time of the launch of the Best Value initiative. This research reveals a support amongst practitioners for the merits of Best Value Audit in the enhancement of transparency and accountability in local government. This chapter identifies the portability of these distinctive audit practices to wider, international settings.
Key words: Best Value; VFM; Performance Auditing; Governance; Local Government.