PART 2 ACCOUNTABILITY AND AUDIT

Audit and value for money examinations

23 Economy, efficiency and effectiveness examinations

(1)

The Auditor General may initiate examinations into the economy, efficiency and effectiveness with which bodies and office-holders mentioned in subsection (2) have used their resources in discharging their functions.

(2)

Those bodies and office-holders are—

(a)

any body or office-holder so far as an account of that body or office-holder is an account in relation to which sections 21 and 22 apply,

(b)

any other body or office-holder, or a body or office-holder of any class, specified by the Scottish Ministers by order,

(c)

any body or office-holder not falling within paragraph (a) or (b) which agrees to such an examination being carried out.

(3)

An order made under subsection (2)(b) may specify a body or office-holder, or a class of body or office-holder, only if the Scottish Ministers reasonably believe that—

(a)

in the case of a body or office-holder, in any of the financial years of the body or office-holder—

(i)

more than a quarter of the income of the body or office-holder was received from public funds, or

(ii)

the amount of the income of the body or office-holder received from public funds exceeded £500,000,

(b)

in the case of a class of body or office-holder, paragraph (a) is satisfied in relation to at least half of those in the class.

(4)

An examination under this section in respect of a body or office-holder, or a body or office-holder of a class, specified in such an order may be carried out only—

(a)

in relation to any period as respects which the Auditor General reasonably believes that—

(i)

more than a quarter of the income of the body or office-holder was derived from public funds, or

(ii)

the amount of the income of the body or office-holder received from public funds exceeded £500,000,

(b)

so far as is reasonably practicable, in relation to the use by the body or office-holder of the income derived from public funds and to resources used in discharging the functions for which such income was used.

(5)

For the purposes of subsections (3) and (4)—

(a)

income is received from public funds if it is paid by—

(i)

any body or office-holder mentioned in subsection (2)(a), or

(ii)

any body or office-holder, or body or office-holder of a class, specified in an order made under subsection (2)(b), in a financial year of that body or office-holder in which more than half of the income of the body or office-holder was received from public funds,

(b)

in calculating income, capital receipts are to be disregarded,

(c)

money paid as consideration for the acquisition of property or the supply of goods or services or as remuneration, expenses, pensions, allowances or similar benefits for or in respect of a person as the holder of an office is to be disregarded.

(6)

In determining whether an examination under this section is to be carried out, the Auditor General must take into account any proposals made by the Parliament.

(7)

Before initiating an examination under this section in respect of F1Scottish Water the Auditor General must consult the Water Industry F2Commission for Scotland.

(8)

It is for the Auditor General personally to initiate an examination under this section and to decide who is to carry out the examination.

(9)

In carrying out the examination that person (“the examiner”)—

(a)

is not entitled to question the merits of the policy objectives of the body or office-holder in question, but

(b)

may consider the appropriateness of any criteria used by the body or office-holder to assess use of resources.

(10)

The examiner (if not the Auditor General) must report the results to the Auditor General, who may report the results to the Parliament.

F3(11)

The Auditor General may publish the results of any examination carried out under this section.