A recent report by the National Audit Office (NAO) revealed that small government bodies in the UK are finding it increasingly difficult to comply with various operational requirements and prepare and audit their annual reports.

This is due to the time-consuming and costly nature of these processes, the report unveiled.

The UK’s public spending watchdog’s report has shed light on the challenges faced by small government bodies in complying with a range of requirements aimed at ensuring efficiency.

These requirements, covering areas such as counter fraud, digital, human resources, and security, are essential for protecting public funds and maintaining public trust.

However, their implementation demands significant time, effort, and cost.

Despite the intention for functional requirements to be adaptable to organisations of varying sizes and complexities, small bodies struggle to identify which requirements are relevant to their operations.

These smaller entities often lack the personnel, expertise, and resources of larger counterparts, making compliance more burdensome.

Small government bodies have expressed a desire for additional support, such as customised self-assessment checklists and more opportunities for knowledge-sharing through conferences and webinars.

While there are instances of departments employing innovative oversight methods, overall supervision of compliance across the government remains inconsistent.

When examining annual reports and financial statements, the NAO found that the same reporting standards are imposed on most UK central government bodies, irrespective of their size and risk level.

This contrasts with the approach taken for small private companies and charities in the UK, as well as small government bodies in countries like New Zealand and Portugal, which benefit from exemptions and simplified requirements.

The increasing length and detail of annual reports and accounts, coupled with the expanding scale and cost of external audits—partly due to changes in reporting and auditing standards and heightened regulatory expectations for audit quality—disproportionately affect small bodies with limited resources.

To address these issues, the NAO suggests that the government, in collaboration with departments, should develop a consistent strategy for determining which bodies may qualify for ‘light-touch’ reporting requirements when the risk to public money is low.

Additionally, the NAO has proposed five considerations for the government when setting new requirements for government bodies, including understanding implementation costs for small bodies, assessing cost-benefit trade-offs, and streamlining existing requirements.

NAO head Gareth Davies said: “The government is implementing ambitious plans to provide greater autonomy to individual public bodies and streamline regulations to increase efficiency and productivity.”

“In doing so, it has an opportunity to review the requirements placed upon smaller public bodies to ensure that they achieve an optimal balance between accountability, transparency, efficiency and continuous improvement.”

Earlier in June 2025, another NAO report highlighted the Cabinet Office’s contract with MyCSP, the administrator of the Civil Service Pension Scheme (CSPS), has not adequately addressed performance issues, as evidenced by a rise in participant complaints from 3,335 in the 2016/17 period to 4,780 in the 2024/25 period.