Agenda item

Peter Barber (Grant Thornton) presented the report.  He explained that Ann Graham joined him at the meeting as she had worked on the report.  This had been the first year of the new Value For Money (VFM) approach.  This year there was more detail on the financial detail, governance, economy, efficiency and effectiveness.  He outlined key recommendations which looked at how effective the arrangements were.  He highlighted that they needed to report in a timely manner.  Sophie Morgan-Bower (Grant Thornton) also present, she was the audit manager for BANES.  He expected to bring the report this year by December.

He stated 2021 had been a strange year with Covid and BANES had a massive £42 million budget gap from forecast loss of income.  However, things had improved with the financial recovery plan.  The Council had returned a surplus and had some key reserves for the future.  The reason for the success was a quick response to the pandemic identification of revenue savings and additional government grant.  The return to normality was increasingly important.

An issue for BANES was financial resilience and the direct school budget (DSG) was a problem.  BANES had good levels of savings but it would be harder to find more.  Careful budget management was necessary and prioritisation would be a challenge..  Vacancies were being held as an interim measure and there would need to be workforce plan decisions as to what posts need to be recruited into.

Ann Graham outlined that the Council had handled Covid 19 well dealing with it flexibly.  She made the following points:

·  The new corporate strategy in February 2020 was revisited later in the year, with a reliance on emergency decision-making and the Council response had been effective

·  Improvement recommendations are risk governance, improving the way risk is reported making it more visible.  There was an opportunity to raise the profile and get a view of the bigger picture

·  As regards whistleblowing, which happens, there were opportunities to refine the process so Councillors get a good perspective

·  With complaints and feedback, residents said there was too much documentation to wade through

·  For Treasury Management there was a need to improve clarity of reporting with a best practice update on an annual basis. 

·  For performance management there was a new framework coming with KPIs linking this together with objectives

·  Contract management, there needed to be key themes across the public sector with managers managing contract appropriately from big to small

·  With economy, efficiency and effectiveness the External Auditor had interviewed key senior people in the authority and it was evident that it was a continuing journey

·  It was noted that financial reporting from period end to publication has improved with reports aligned to the quarterly reporting cycle and published 4-5 weeks from the period end.

During questions the following issues arose:

·  Vacancy management (Cllr Furse) – money was saved over a long period but the ability to deliver and efficiency was damaged

·  Capital management – using cash flow for our projects rather than borrowing

·  DSG deficit from SEND placements.  The Section 151 Officer Andy Rothery explained this related to SEND provision where the Council carries a deficit forward as it is a passed-through fund administered by the Council.  There was a loss in the balance sheet but it was in a ring-fenced account, not a call on the general fund.  There would be a DfE programme to discuss a recovery plan with local authorities. Demand was outstripping supply

·  In light of next year’s elections (Cllr Blackburn) the register of interests needed to be up-to-date.  The Monitoring Officer should have a mechanism to remind councillors as a matter of routine (The Section 151Officer would take this issue to the Monitoring Officer)

·  Declaration of interests had changed (Cllr Simmons) from every 4 years to annually

·  The external auditor would follow these recommendations up as the Council may already have trackers

·  The Service Director – Commercial and Governance (Jeff Wring) explained that there was a record of the recommendations with an implicit responsibility for good governance.  It was recognised that there had been inconsistencies and it would be looked at in the Annual Governance Review

·  Positive feedback reported back to Cabinet has improved (Cllr Hodge) but the lack of trends in Treasury Management reporting was frustrating

·  Feedback on whistleblowing and benchmarking narrative to compare with other authorities

·  Unit costs – always difficult to be consistent (Peter Barber External Auditor) but they were becoming more efficient

·  The new VFM format was good (Cllr Hodge).

RESOLVED to note the Annual Report, VFM Report and recommendations arising.