Auditors’ Local Evaluation and Use of Resources 2008/09

Each year, the Audit Commission assesses how well NHS trusts and primary care trusts manage their resources and deliver value for money. For 2008/09, these assessments have been based on the Auditors’ Local Evaluation (ALE) for NHS trusts and Use of Resources (UoR) for primary care trusts. The Commission has published a national report outlining the scores and how they should be viewed in the context of the overall financial performance of the NHS in 2008/09, which is one of a continued improvement in financial stability. NHS foundation trusts are assessed by Monitor.

Auditors make assessments in a number of themes using key lines of enquiry. There are five themes for ALE and three themes for UoR:


  • financial reporting
  • financial management
  • financial standing
  • internal control
  • value for money


  • managing finances
  • governing the business
  • managing resources

2008/09 was the first year that PCTs were assessed using the new UoR methodology. UoR differs significantly from ALE, although the process and scoring system are similar. The UoR assessment is more demanding than the ALE assessment. It is broader, with a greater focus on outcomes.

The UoR results are a building block in the new Comprehensive Area Assessment to be published in December 2009. The Care Quality Commission, Ofsted, the Audit Commission and the police, probation and prisons inspectorates are preparing a joint judgement on the quality of public services in England’s 152 local areas, geared to public opinion surveys and the needs and priorities of different places.

Key areas for improvement highlighted by the Audit Commission include:

Risk management and assurance

Although arrangements are generally adequate in this area, the ALE assessment for 2009/10 will cover what NHS trusts have done in response to the Audit Commission’s report on how boards of NHS trusts get their assurance, Taking it on Trust. The report found that although most NHS trusts have the right processes in place, the rigour with which these are applied varies considerably. In light of this, NHS trusts should review their risk management and assurance arrangements to ensure that they are robust and working effectively and that the recommendations contained in the Audit Commission report have been considered.

Demonstrating outcomes

Difficulty in demonstrating outcomes, and uncertainty over what constitutes an outcome, appears to have prevented some PCTs from scoring higher in relation to the ‘governing the business’ and ‘managing resources’ themes. Outputs demonstrate the effectiveness or impact of processes and arrangements – for example, improved sickness absence levels might be an outcome of implementing staff well-being initiatives. PCTs need to consider carefully how they can evidence outcomes and link outcomes to processes and arrangements.

The Commission also warns NHS organisations that “If high-quality services are to continue to be maintained and developed as funding growth slows down, the challenge will be to ensure that NHS trusts and PCTs plan and successfully implement efficiencies and service modernisation in advance of expected financial pressures.”

Both summary and full versions of the Audit Commission report Auditors’ Local Evaluation and Use of Resources 2008/09 can be downloaded here.

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