Audit Commission hands out contracts for Yorkshire
TWO accountancy firms have won major five-year contracts from the Audit Commission to cover work in Yorkshire.
The contracts awarded to KPMG and DA Partnership, a subsidiary of Mazars, will contribute to up to a 40% cut in the audit fees paid by the public sector in the region.
KPMG has been awarded a contract with a value of £23.1m a year covering three contract areas in Yorkshire and the Humber, East Midlands, and London.
A contract with a value of £5m a year covering one contract area in the North East and North Yorkshire has been handed to DA Partnership.
Grant Thornton and Ernst & Young have also been handed contracts to provide outsourced audit services to local authorities and the NHS.
The Audit Commission said public bodies were expected to save more than £30m a year for the length of the contracts.
Together with additional savings of £19m a year achieved through efficiencies by the Audit Commission, £250m is expected to be saved by public bodies over the five year period.
Audit Commission chairman Michael O’Higgins said: “This procurement has been the result of a rigorous assessment of each bidder against published cost and quality criteria, and will mean significant audit fee savings for local councils, NHS trusts and other local bodies.”
Chief Executive Eugene Sullivan added: “This has been a complex process delivered to a very challenging timetable, and we are pleased with the outcome.
“But we should also acknowledge that this is a pivotal point in the history of public service. We will be losing a distinctive, and publicly-owned, local public audit service and its District Auditors who have helped to protect the public purse effectively for over 150 years.”
Grant Thornton, which won £43m in contracts overall, saw its public services team based in Leeds lead its bid.
Jonathan Riley, senior partner at Grant Thornton in Yorkshire, said: “Our quality was very strong and this resulted in our considerable success. And of course, whilst these contract wins help Grant Thornton to grow, it means that public sector services get a boost by the savings the Government achieves by outsourcing, thereby either protecting existing services or growing the delivery of services to front line.”
DA Partnership said if it had won more work from the Audit Commission it would have set up as an employee-owned independent firm. Instead, it has become a wholly-owned subsidiary of Mazars and will trade as Mazars DA.
Gareth Davies, who was the Audit Commission’s regional director for the northern region from 2000 to 2006, will be joining Mazars as head of public services to lead the new venture.
Mr Davies said: “I’m looking forward to working with the North East and North Yorkshire team, the advisory team and Mazars colleagues to build a new and exciting offer for our public service clients.”
