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• Full report - C&AG report on the qualification of the Equality and Human Rights Commission’s accounts

The Comptroller and Auditor General has qualified the accounts of the Equality and Human Rights Commission (EHRC) because the EHRC re-engaged, without Treasury authority, seven former senior employees of the former Commission for Racial Equality who had left that body under a voluntary early severance scheme.

The EHRC, established in April 2006 and operational from the beginning of October 2007, took over the responsibilities of three ‘legacy’ equality Commissions: the Commission for Racial Equality; the Disability Rights Commission; and the Equal Opportunities Commission. The EHRC faced difficulties from the beginning as it did not have enough staff to plan and manage the start up effectively.

As at 1 October 2007, it had a shortfall of 140 staff out of an agreed complement of 525, with particular problems at senior staff level - with only 10 of the agreed complement of 25 directors in place. The severity of the shortfall arose partly because some 180 staff left the legacy commissions under voluntary early severance programmes. The EHRC had little influence over which legacy Commission staff left under these schemes, and to try and resolve some of its key staffing difficulties it re-engaged without a break in service seven staff members who had left under the voluntary exit schemes.

The EHRC incurred costs of £629,276 in respect of the severance costs of these individuals, but, on returning to the Commission, these staff received between them consultancy fees of £323,708. The Treasury had not authorised in advance the payments to re-engage these staff, and refused to do so retrospectively because it did not consider that the payments represented value for money. In particular, the Treasury expressed concern about the level of the salaries paid to the re-engaged staff and raised the possibility that the re-engaged staff should have repaid their severance payments.

Amyas Morse, the head of the National Audit Office, said today:

“The Equality and Human Rights Commission was established 18 months before it became operational, to enable a smooth transition from the three predecessor organizations. But delays in bringing in resources sufficiently quickly meant that, when it started doing its job, it lacked more than half of its complement of directors, and made the mistake of re-employing some senior staff from predecessor bodies without authority.

“The shortage of senior staff weakened EHRC’s ability to develop a clear business strategy, agree an organisational design and ensure effective operational management was in place. These problems could have been avoided if the transition from the previous equality commissions had been better planned. The EHRC has since made welcome progress in improving its controls and governance.”

Notes for Editors: 

1. Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk.  Hard copies can be obtained from The Stationery Office on 0845 702 3474.

2. The Comptroller and Auditor General, Amyas Morse, is the head of the National Audit Office which employs some 900 staff.  He and the NAO are totally independent of Government.  He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.