Annual Report 2015

Annual report | 24-03-2016

What did we do in 2015?

We published 18 audit reports, submitted 22 letters to parliament and released eight updates for web dossiers in 2015. Two of the audits are considered below.

Audit of the basic health insurance package

One of the audits we carried out in 2015 looked at the insurance package for basic healthcare services. In recent years, the Minister of Health Welfare and Sport (VWS) has introduced a package of measures to reverse the growth of healthcare expenditure. One of the measures has been to remove certain treatments from the insured package. We asked whether the minister’s policy had succeeded in managing the growth of healthcare costs?

Audit findings

At the time of the audit, the package of measures had had less impact on healthcare costs than expected. At the end of the 2007-2013 period, the measures had reduced annual healthcare expenditure by €0.25 billion, but the target had been twice as high: €0.5 billion.

Audit leader Rogier Zelle:

On this audit we worked with the health insurer Achmea. This was quite unusual because we do not have any formal audit powers to work with a private company. We studied anonymised claims to calculate the impact of the economy measures on the basic package. As a nation we spend approximately €45 billion every year on collective health insurance. Our audit provided parliament with a deeper understanding of the limited financial benefits of the interventions in the basic package.

Tax incentives for electric and hybrid cars

Our annual Accountability Audit asks whether central government policy is actually working. On Accountability Day last year (20 May 2015), we informed parliament of the tax incentives introduced for electric and hybrid cars, chiefly in the form of lower motor vehicle taxes. This is a relatively expensive measure. We asked whether there were more effective and less expensive ways of promoting cleaner cars.

Audit findings

Our audit found that the government’s target of having 200,000 electric and hybrid cars on the road by 2020 was feasible. But given the experience so far, there was a serious risk that the target would be reached chiefly thanks to large hybrid plug-in cars in the business market. These cars will make only modest contributions to reducing CO2 emissions. The government is encouraging the sale of electric and hybrid cars by reducing the taxes on them. The tax revenues collected by the Minister of Finance will therefore be lower. Alternative measures to promote the sale of electric and hybrid cars have not been worked out.

Audit leader Noelle Ruckert:

We wrote in our Accountability Audit report that incentives for clean cars were relatively expensive. We calculated in 2013 that they might have cost as much as €5 billion since 2007. The Minister of Finance has since decided to cut the tax incentives available for hybrid car owners. The EU has also required manufacturers to make cleaner cars.

What international activities did we carry out in 2015?

As a knowledge institution, we share our insights and work with foreign supreme audit institutions. In 2015 we were closely involved in the change process being undertaken by the Iraqi Federal Board of Supreme Audit (FBSA).

We have been working with the Iraqi audit office since 2011. It is facing extremely high risks in its efforts to strengthen public accountability, transparency and the protection of public funds in a fragile state. Twenty of the FBSA’s staff have been killed because of their work since 2003. This project is a encouragement for the FBSA: ‘We needed a friend,’ said the FBSA’s former president, Dr Turki Abdulbasit.

In this project we are helping our Iraqi counterparts improve their institutional development of audit methods and techniques, strategy development and communication with parliament and other stakeholders. We are working together by means of video conferences and workshops in the Netherlands and in safe neighbouring countries of Iraq. You can read an interview with Dr Abdulbasit on the challenges and ambitions of the FBSA in the book, The Art of Audit. We published this book on the work of fellow audit institutions to mark the retirement of our former president, Saskia J. Stuiveling.

Cooperation with other supreme audit institutions

As well as the cooperation project with the Iraqi Federal Board of Supreme Audit, we worked with the audit offices of Jordan, Greece, Kosovo, Serbia, Sudan, Tanzania and Tunisia during the year. We also peer reviewed, at their request, the work of the German, Estonian and Latvian audit offices in 2015. We spent €2.3 million on our international work in 2015. Part of the expenditure was funded externally (in the case of the Iraqi audit board, by the Ministry of Foreign Affairs and the World Bank) and part was charged to our own budget.

What did it cost to have the Court of Audit audit central government in 2015?

The Court of Audit’s audits of central government cost €28.7 million in 2015. That is €1.3 million less than in 2014.
 

To sum up the financial facts:

• We had budgeted €28.802 million for the audits, but we actually spent €28.730 million. 
• We spent more than 86% percent of this amount on our most valuable assets: our people (289 in 2015). We spent the rest on equipment.
• The total cost of the Court of Audit’s Board in 2015 was €474,914.
• In 2015 we spent €427,213 on external staff.
• The Court of Audit calculates the cost of its audits in days. One audit day cost €975 in 2015. In total, there were 17,956 audit days during the year.
• In 2015 we completed a cost-cutting programme to save €1.9 million. A new programme to save €1.2 million is planned for 2016-2018.
• The Court of Audit’s costs in 2015 were equal to 0.01% of total government expenditure.

General ledger as open data

We have been publishing all our expenditure (‘our general ledger’ as open data since 2014. The open data file is freely accessible and re-usable by everyone. We want this form of open spending to promote the financial transparency of government.

What are we going to do in 2016 and later years?

With our strategy for 2016-2020 and our work programme, we are optimally placed to respond to our rapidly changing environment.

National borders are blurring. Tensions between public services and finances are growing. Technology is advancing and the government itself is continuously changing. All these developments will affect our work and will be considered in our multiannual audit programmes in the years ahead. More so than in the past, we will examine the flow of public finances. These programmes for 2016-2020 will contribute to:

Insight into the sustainability of public finances in a European context. In this programme we will audit budget policy and accounting systems. We will also follow the EU aid programmes and explain how funds flow to and from the EU.

• Insight into public revenue. This programme will focus more sharply on the government’s budgeted and actual revenue.
• Insight into health care and social security contributions. This programme will audit the outgoings of the Ministry of Health, Welfare and Sport and the Ministry of Social Affairs and Employment, their accountability and their funds management.
• More insight into the effectiveness and efficiency of new audit methods and techniques. We want to gain a better understanding of the social outcomes of government spending by mapping out the latest audit methods.

Modern and effective accountability

On Accountability Day, the third Wednesday in May, we will present our audit of central government’s financial accounts to parliament. Our ambition for the coming years is to clarify how we arrive at our opinion on the regularity of the accounts by:

• continuing to highlight the importance of having a high standard of regularity and clear regulations;
• providing more insight into significant implementation issues in the public sector;
• providing more insight into the societal outcomes of expenditure and policy measures.

In the years ahead we will also carry out continuous, government-wide audits of personnel, ICT and asset management and look at the uncertainties and long-term challenges regarding security and sustainability.

With this focus in our audit programme, we will invest in the quality of our work. Taxpayers must be confident that the government spends the taxes and other income it receives so that they have the intended effect. We have unique powers to keep a check on all of central government.