The exceptionally wet winter has thrust on to the front pages those obscure West Country rivers the Axe, Brue and Parrett. They drain – or rather don't drain – the Somerset levels into the Bristol Channel.

So far the Environment Agency has taken much of the political heat over the persisting problems with low-lying water, but at some point residents and MPs will catch up with the Somerset Drainage Board Consortium – the small-scale public body that levies a rate and gets grants to run pumping stations and (ahem) stop flooding.

The consortium divides its accounts. The board for the rivers Axe and Brue has a turnover of about £1.5m a year. Small scale, maybe, but it remains precious public money that deserves a ‘fair and true account'.

And that has until now been provided by the Audit Commission. To cut costs, the commission has let a block contract (in this instance to Grant Thornton) to audit a large number of such boards, parish councils and other small bodies.

No more. With royal assent to the Local Audit and Accountability Act, Eric Pickles has finally killed the commission.

But he never quite got round to the drainage boards. Communities and Local Government officials hope the National Association of Local Councils will step up and manage a single contract with private auditors on behalf of a disparate bunch which, plus the drainage boards, numbers some 6,400 small bodies.

But they admit, privately at least, that is a leap of faith. And it doesn't solve the problem of who pays if auditors have to spend extra time on ratepayers objections or, after the floods subside, questions about pumps that didn't work.

Why should Pickles worry: he got his Daily Mail headlines. It may have taken the best part of four years, but he slew the bureaucratic dragon. No more will Smaug breathe fire on the locals.

Except…what's this, the clumsy minister has awakened Lady Sauron, played imperiously by Margaret Hodge.

The orcs of the National Audit Office (NAO) are now to conduct wide-ranging attacks (sorry studies) of value for money studies of councils. To whom are its reports to go for scrutiny and questioning of witnesses?

The answer has to be the House of Commons Public Accounts Committee, whose MPs are no particular friends of council autonomy or claims of efficiency and effectiveness.

Another sign of the times is that the NAO's latest recruit to bolster its local investigative role is not a former local authority official but a civil servant, Sue Higgins, from DCLG itself.

From the local point of view, there's hidden menace in the NAO saying that it has ‘already started to augment its programme of work with a small number of additional examinations providing a more ‘end to end' view of the use of public funds – helping to inform parliament while adding value at the local level'.

What if, in the study now under way on adult social care, the NAO finds, as it surely will, wide variation in costs and quality in local authorities?

Before anything else, however, the NAO may well be bidden to investigate the claims trumpeted by Pickles that abolishing the commission has saved £1.2bn. This figure is fishy. A large part of it seems to be savings from renegotiation of block audit contracts by the commission itself.

Most of the rest comes from stopping value for money studies. If councils do not really need comparative performance information, the commission's demise is no loss.

But in financial adversity, what if councils need more than ever a central intelligence hub pulling together data on costs and performance: you'd have to conclude the commission's death is a real loss.

But the deed is done. Let's look forward: to quango creation. Who is going to oversee existing audit contracts that run until 2017 when the commission goes, except some new organisation?

Let's contemplate the expense of councils having to create new independent auditor panels at a time when money is tight. And don't let's forget the Somerset levels. If the rain keeps falling, audit of the bodies responsible for their drainage may take on added significance.

David Walker is former director of public reporting at the Audit Commission