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States grants system ‘has weaknesses’

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TENS of millions of pounds’ worth of grants and subsidies given out by the States annually are being administered through a system that is plagued with ‘significant weaknesses’, according to the Island’s independent spending watchdog.

Karen McConnell

Comptroller and Auditor General Karen McConnell found that although there were some examples of good practice, the States could not always prove value for money was being achieved.

As a result, in a report out today, she says there is ‘significant scope for improvement’ and has made a number of recommendations to the system used to give out almost £44 million of taxpayers’ money annually. She also praised the new accounting officer at Economic Development – Dan Housego – for writing to the Treasurer of the States in October to identify issues with the system and a lack of capacity within his department to address them.

She said: ‘I am concerned that there are weaknesses in the management of grants and that taken together the weaknesses are significant and mean that the States are not able to demonstrate that value for money is secured from expenditure on grants; and in some parts of the States a culture was tolerated that allowed such weaknesses to persist even after Internal Audit made recommendations for improvement. Although these issues have been highlighted within Economic Development, Tourism, Sport and Culture, there is room for improvement in other departments.’

A new financial direction – the rules used to dictate how public money is spent – is due to be issued soon covering grants. However, Ms McConnell said more work was still needed to ‘enable the States to demonstrate that value for money is consistently being secured from grant expenditure’.

Last year the States gave out a total of £43.496m in subsidies and grants, with Education, Social Security and Economic Development responsible for 86 per cent of the total number, receiving under £100,000.

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