The National Audit Office has qualified the Cabinet Office's annual report and accounts for 2023-24 because of red flags related to the Government Property Agency.
According to the public-spending watchdog, "weaknesses" in the GPA's accounting for ongoing capital projects and "irregular spending" on one particular contract are the reason for the NAO's decision not to approve the Cabinet Office's just-published accounts in their entirety.
The GPA is the Cabinet Office's executive agency responsible for managing a growing portfolio of buildings and providing workspace for much of the civil service.
As of 31 March this year, it held almost two-thirds of the Cabinet Office's £330m "assets under construction" category of projects that are still in progress.
However the NAO said its concerns about the GPA centre on a failure to transfer assets out of that category "on a timely basis", leading to uncertainty about whether the agency's year-end asset balances are correctly classified and valued.
"This means that the assets that should have been depreciated from the date of transfer will be overstated, while depreciation charges will be understated," the watchdog said.
While a detailed review of the GPA's £214m year-end "assets under construction" balance has begun, the NAO said there was was "insufficient evidence" that £28m of the figure had been correctly classified. The watchdog said the full review would take several months to complete.
Earlier this year it emerged that the GPA's own 2023-24 accounts were set to be qualified because of a breach of spending controls. That failure saw the agency agree a £6m site-security contract before obtaining approval from the Cabinet Office commercial-control team.
As part of his qualification of the Cabinet Office's accounts, NAO head Gareth Davies described the contract agreement as "irregular".
Elsewhere, the Cabinet Office's annual report and accounts reveal that the department's spending on temporary staff increased to £93.3m in 2023-24, up from £58.9m the previous year. Some £12.2m of the 2023-24 total related to the GPA, up from £9.8m the previous year.
Pay rises for Case and Chisholm
The report also shows that outgoing cabinet secretary Simon Case – replaced as the nation's top civil servant today by Sir Chris Wormald – received a significant pay rise in 2023-24.
According to the accounts, Case's 2023-24 salary range was £215,000-£220,000, up from £200,000-£205,000 the previous year – meaning he received a minimum rise of £10,000, representing an uplift of at least 4.8%.
Former Cabinet Office permanent secretary – and civil service chief operating officer – Sir Alex Chisholm also saw his pay increase. His salary bracket rose from £205,000-£210,000 in 2022-23 to £215,000-£220,000 last year. Chisholm left the civil service at the end of March.
In recent years the Cabinet Office has published a "high earners list" detailing all government employees who earn £150,000 a year or more, however a 2024 update has yet to materialise.
Consequently, the latest Cabinet Office annual report and accounts is the most up-to-date information on senior leaders' earnings in the department since last year's ARA was published in September 2023.