Agenda and draft minutes

Venue: Kaposvar Room - Guildhall, Bath. View directions

Contact: Sean O'Neill  01225 395090

Items
No. Item

159.

EMERGENCY EVACUATION PROCEDURE

The Chair will draw attention to the emergency evacuation procedure as set out under Note 7.

Minutes:

The Democratic Services Officer advised the meeting of the procedure.

160.

ELECTION OF VICE-CHAIR

To elect a Vice-Chair (if required) for this meeting.

Minutes:

RESOLVED that a Vice-Chair was not required on this occasion.

161.

APOLOGIES FOR ABSENCE AND SUBSTITUTIONS

Minutes:

Apologies were received from Councillors Chris Dando and Andrew Furse. Councillor Tim Ball substituted for Councillor Furse.

162.

DECLARATIONS OF INTEREST

At this point in the meeting declarations of interest are received from Members in any of the agenda items under consideration at the meeting. Members are asked to indicate:

(a) The agenda item number in which they have an interest to declare.

(b) The nature of their interest.

(c) Whether their interest is a disclosable pecuniary interest or an other interest,  (as defined in Part 2, A and B of the Code of Conduct and Rules for Registration of Interests)

Any Member who needs to clarify any matters relating to the declaration of interests is recommended to seek advice from the Council’s Monitoring Officeror a member of his staff before the meeting to expedite dealing with the item during the meeting.

Minutes:

There were none.

163.

TO ANNOUNCE ANY URGENT BUSINESS AGREED BY THE CHAIR

The Chair will announce any items of urgent business.

Minutes:

There was none.

164.

ITEMS FROM THE PUBLIC - TO RECEIVE DEPUTATIONS, STATEMENTS, PETITIONS OR QUESTIONS

Minutes:

There were none.

165.

ITEMS FROM COUNCILLORS AND CO-OPTED AND ADDED MEMBERS

To deal with any petitions, statements or questions from Councillors and, where appropriate, co-opted and added Members.

Minutes:

There were none.

166.

MINUTES:12 SEPTEMBER 2017 pdf icon PDF 81 KB

Minutes:

These were approved as a correct record and signed by the Chair.

 

Minute 156, page 4 (agenda page 8), third paragraph: progress on review of number of administrative staff and maintenance of separation of duty principles: the Divisional Director – Business Support advised that the review had been completed.

167.

TREASURY MANAGEMENT MID-YEAR PERFORMANCE UPDATE pdf icon PDF 258 KB

Minutes:

The Divisional Director – Business Support presented the report. She noted that, contrary to the expectation of the Council’s treasury management advisors, the Bank of England had raised base rate by 0.25% to 0.5% on 2 November. In response to a question from the Chair about the impact on the Council’s outstanding loans, she explained that it was the Public Works Loan Board rates that were significant. After the BoE rise some PWLB rates had been reduced, though it was expected they would rise in future.

 

In response to a question from a Member she explained that because of current low interest rates only a small amount of cash was invested to provide immediate cash flow, while most cash was used to finance capital investment instead of long-term borrowing.

 

RESOLVED:

 

1.  to note the Treasury Management Report to 30th September 2017 prepared in accordance with the CIPFA Treasury Code of Practice.

 

2.  to note the Treasury Management Indicators to 30th September 2017.

168.

EXTERNAL AUDIT UPDATE AND ANNUAL AUDIT LETTER pdf icon PDF 60 KB

Additional documents:

Minutes:

Mr Morris commented on the Annual Audit Letter, which summarises the work undertaken by the external auditor during the year.

 

He said that the review of Housing Benefit returns for DWP had been completed. A qualification letter had been issued, which identified a number of issues and would be presented to the next meeting of the Committee. The proportion of errors was quite high, but the total value quite low. A Member asked whether there were any particular factors causing errors. The Divisional Director – Business Support replied that in some cases there were errors in applicants’ claim forms. In others there were complexities, such as a transfer of tenancies, which gave rise to errors during processing. An error reduction action plan was in place and would be reviewed quarterly. Members were pleased to note this.

 

Mr Morris drew attention to the final fees for audit and provision of non-audit services (agenda page 39). An additional fee would be charged for the work on Housing Benefit claims.

 

Mr Barber introduced himself and his colleagues Sophie Morgan and Scott Corboy (not present at the meeting) as the Council’s 2017/18 external audit team.

 

Ms Morgan commented on the External Audit Update Report.

 

A Member asked why the external auditor had drawn attention to the Independent Review of Building Regulations and Fire Safety (agenda page 52). Mr Barber and Mr Morris pointed out that there could be impacts on the capital programme, corporate risk, including reputational risk, and control systems. A Member suggested that the Council needed to assess any relevant risks identified by the review report and the resources that needed to be allocated to address them. He hoped that the Government would provide additional funding to local authorities and the rest of the public sector for work on buildings that needed to be brought up to fire safety standards. The Divisional Director – Business Support responded that there had been a suggestion that the Government might do this, but they would want to see what the costs of doing so would be. There is nothing specific about it in next year’s grant bid information, but it is possible to bid for funds for property maintenance. The Chair commented that as far as he knew there were no buildings in Bath and North East Somerset that had the same type of cladding as the Grenfell Tower.

 

Mr Barber commented on the planned audit fee for 2017/18 (agenda pages 63-64).

 

It was noted that this would be the last meeting of the Committee that Mr Morris would attend. Members thanked him for his past assistance and support and wished him well for the future.

 

RESOLVED to note the report and updates provided by the External Auditor.

169.

INTERNAL AUDIT MID-YEAR PERFORMANCE UPDATE pdf icon PDF 157 KB

Minutes:

The Audit Manager (Audit West) presented the report.

 

He said that staff resources had been severely stretched because of sickness, staff leaving and unplanned work. . The Head of Audit West said that the staffing situation could impact on the work being done for the Council for the rest of the year and on Audit West’s external contracts. He had secured additional staff resources through the arrangement with Devon Audit Partnership; these were being deployed on audit work for the Avon Pension Fund. Attempts were also being made to recruit agency staff. However, it was unlikely that any new staff would be in place before the end of this financial year.

 

Members noted the reasons for current performance against plan but were concerned. One Member said that the magnitude of the risk to the Council of inadequate audit should be taken into account in decisions about the resourcing of the function; the consequences to the Council of making mistakes with Universal Credit, for example, could be severe. The Head of Audit West responded that the situation could be managed to a degree in the short term. He had informed the Committee about the steps he was taking to secure additional staff resource and he drew attention to the information in paragraph 4.2.4 of the report about reviewing the scope of scheduled audits. The focus would be on the highest risks. The current state of the employment market for auditors was such that it would be very difficult to recruit suitably qualified people in any case. The main cause for failure to deliver the plan had been sickness, and both the affected individuals were now back at work. The Member, however, felt that every reduction in staff resource in the Audit Team increased the risk for the Council, and that there should be a minimum complement of auditors which should not be reduced. Another Member agreed with this, and proposed that the resolution should be amended to express the Committee’s concern about the impact of the recruitment freeze on the performance of Internal Audit. The proposed amendment was accepted by the Committee.

 

[Councillor Ball left the meeting.]

 

The Audit Manager (Audit West) reported on the follow-up and implementation of audit recommendations. A Member said he was extremely unhappy that recommendations made had not been implemented, and suggested that this should be brought to the attention of the relevant Cabinet Member. Another Member suggested that the Committee take a hard line if the recommendations were not implemented. The Head of Audit West responded that the when follow-up reviews took place, there were often legitimate reasons why recommendations had not been implemented. There was total transparency in reporting non-implementation to the Committee, but he felt that mitigating circumstances had to be taken into account, and that a judgement had to be made, based on the relative value of the risk, about when it was appropriate to report non-implementation to a higher level. If the recommendations about the use of council vehicles had not  ...  view the full minutes text for item 169.

170.

INTERNAL AUDIT PROFESSIONAL STANDARDS REVIEW pdf icon PDF 237 KB

Minutes:

The Head of Audit West presented the report. Members noted that Audit West’s next quinquennial external assessment had to be completed by 30 March 2018. Audit West must comply with the revised Public Sector Internal Audit Standards, which came into effect from 1st April 2017. Members noted the results of the PSIA self-assessment contained in Appendix 1, in which compliance was assessed as red, amber or green. Red assessments were due to the need to refresh the Internal Audit Charter. The Committee was invited to approve the revised Internal Audit Charter contained in Appendix 2.

 

Mr Morris noted that the external assessment would be carried out by the Head of Devon Audit Partnership and asked whether there would be a conflict of interest through the relationship of Devon Audit Partnership with Audit West. The Head of Audit West replied that the Head of Devon Audit Partnership would not be involved in the direction or operation of any work that the Devon Audit Partnership is currently undertaking on behalf of Audit West.

 

RESOLVED:

 

1.  To note that the Council’s Internal Audit Service (Audit West) has to comply with the revised PSIAS which came into effect from 1st April 2017.

 

2.  To note the Self-Assessment PSIAS RAG and approve the associated Action Plan (Appendix 1).

 

3.  To approve the revised Internal Audit Charter (Appendix 2).