This book, written by the erstwhile Chair of the House of Commons Public Accounts Committee and subtitled “How Corporate Bad Behaviour and Government Waste Combine to Cost Us Millions”, should be compulsory reading for every accountant.
Since Dame Margaret Hodge turned herself into the scourge of the tax avoidance industry, many members of the profession have regarded her as an unnecessary evil intent on threatening their livelihoods.
Even a number of those detractors will recognise that some of the issues that she raises in Called to Account, which has recently been published in paperback by Little Brown at £9.99, with regard to the waste of public funds are shocking and need to be resolved.
Approximately half of the book is devoted to the efforts of the Committee, led from the front by the redoubtable Dame, to force assorted civil servants and even ministers to look into major players in the tax avoidance industry.
While many of us in the industry will be reasonably familiar with the tax avoidance techniques that have been investigated, the level of evasion that receives tacit support from multinationals is remarkable.
In different chapters, she covers potential abuses by Goldman Sachs, Google, Starbucks and Amazon, the Big Four, boutique advisers and HSBC. As one might expect given her initial stance, none of these parties come out of Called to Account looking good.
She also looks with a shrewd theoretical eye at ways in which the tax system and those operating it could close loopholes and generally improve the country’s finances, which would benefit us all.
That fits into the general remit of a committee set up to investigate the operation of government and ensure that funds are not wasted through inefficiencies, “pig-headedness” or even malevolent conduct.
The unconscionable waste that the committee has uncovered is more widespread than one might imagine. None of us would necessarily be too surprised to discover that the Ministry of Defence has frittered away billions on massive projects that fail. Similarly, HMRC is not the only part of government to try and implement computer projects and eventually abandon them with the only beneficiaries being consultants.
PFI projects have tended to benefit the private sector far more than their governmental partners, while every reader will be attempting to get a high-powered role at the BBC, given that the termination payments they might expect to receive on leaving would not embarrass some Premier League footballers.
All too often though, the reason for bad decisions is entirely political, one government pursuing its own agenda at the expense of the public purse, only to see this reversed by their successors, neither achieving any good for the country or its voters.
In addition, civil servants are diminishing in number and seem to lack the necessary skills to do basic project management, which many might regard as somewhat surprising.
This is genuinely a rip-roaring read and a real eye-opener. While many of us will be aware of occasional reports on waste in government, the levels identified are astounding and it would not be unreasonable to describe many of the failures highlighted as scandalous.
I can thoroughly recommend this book to anyone with an interest in accountancy, since many of the techniques used by the committee to interrogate civil servants and also representatives of private companies offering them support would help auditors in their daily grind. They would also be of benefit to any of us wishing to live our lives more effectively.
The downside to reading this page-turner is that by the time you finish the final chapter, depression may be setting in as you realise the scale of the task ahead of any legislators willing to take on even a few of these problems to save some of those lost billions.