Agenda, decisions and draft minutes

Members are required to notify any substitutions by midday on the day of the meeting.

Late substitutions will not be accepted and Members attending as a substitute without having given the due notice will not be able to take part in the meeting.

Apologies for absence were received from Councillor Sean Nolan.

Having given due notice Councillor Daniel Wright-Mason substituted for Councillor Nolan.

Audio recording – 1 minute 31 seconds

Apologies for absence were received from Councillor Sean Nolan.

Having given due notice Councillor Daniel Wright-Mason substituted for Councillor Nolan.

To take as read and approve as a true record the minutes of the meeting of the Committee held on the 4 September 2024.

RESOLVED:That the Minutes of the Meeting of the Committee held on 4 September 2024 be approved as a true record of the proceedings and be signed by the Chair.

Audio Recording – 1 minute 58 seconds

Councillor Vijaiya Poopalasingham, as Chair, proposed and Councillor Ruth Brown seconded and, following a vote, it was:

RESOLVED:That the Minutes of the Meeting of the Committee held on 4 September 2024 be approved as a true record of the proceedings and be signed by the Chair.

Members should notify the Chair of other business which they wish to be discussed at the end of either Part I or Part II business set out in the agenda. They must state the circumstances which they consider justify the business being considered as a matter of urgency.

The Chair will decide whether any item(s) raised will be considered.

There was no other business notified.

Audio recording – 2 minutes 55 seconds

There was no other business notified.

Members are reminded that any declarations of interest in respect of any business set out in the agenda, should be declared as either a Disclosable Pecuniary Interest or Declarable Interest and are required to notify the Chair of the nature of any interest declared at the commencement of the relevant item on the agenda.  Members declaring a Disclosable Pecuniary Interest must withdraw from the meeting for the duration of the item. Members declaring a Declarable Interest, wishing to exercise a ‘Councillor Speaking Right’, must declare this at the same time as the interest, move to the public area before speaking to the item and then must leave the room before the debate and vote.

(1)        The Chair advised that, in accordance with Council Policy, the meeting would be recorded.

(2)        The Chair drew attention to the item on the agenda front pages regarding Declarations of Interest and reminded Members that, in line with the Code of Conduct, any Declarations of Interest needed to be declared immediately prior to the item in question.

(3)        The Chair advised that section 4.8.23(a) of the Constitution did not apply to this meeting.

Audio recording – 3 minutes 4 seconds

(1)        The Chair advised that, in accordance with Council Policy, the meeting would be recorded.

(2)        The Chair drew attention to the item on the agenda front pages regarding Declarations of Interest and reminded Members that, in line with the Code of Conduct, any Declarations of Interest needed to be declared immediately prior to the item in question.

(3)        The Chair advised that section 4.8.23(a) of the Constitution did not apply to this meeting.

To receive petitions, comments and questions from the public.

There was no public participation at this meeting.

Audio recording – 3 minutes 56 seconds

There was no public participation at this meeting.

REPORT OF THE SHARED ANTI-FRAUD SERVICE (SAFS)

To review the progress and delivery of the Anti-Fraud plan 2024-25.

RESOLVED: That the Finance, Audit and Risk Committee noted the progress by Officers and the Shared Anti-Fraud Service to deliver the Anti-Fraud Plan for the Council.

Audio recording – 4 minutes 9 seconds

The Counter Fraud Manager presented the report entitled ‘SAFS Anti Fraud Update 2024-25’ and highlighted that:

·       The report detailed the current work activity and the half yearly performance KPIs.

·       There had been 22 fraud alerts and additional generic fraud reports.

·       Seven specialised training sessions had taken place with more sessions planned for quarter 3.

·       There had been 56 allegations of fraud received, related to housing, Council Tax. procurement and parking services. 37 of these allegations were under investigation and 18 had reached a referral stage. The combined losses for these allegations was £242K.

·       Seven cases had been closed with £7K of identified losses and £13K of savings.

·       Identified losses had the potential to be recovered, whereas savings were considered as money that could have been lost if the fraud had continued.

·       One case had been referred to the Legal Team to consider prosecution and one case resulted in a ‘cease and desist’ notice being issued.

·       There were six tenancy cases being investigated and a property had been recovered.

·       A review of 18 Council Tax fraud cases had identified £10K of losses.

·       The results from the National Fraud Initiative were now due on the 20 December 2024 instead of January and resources had been reallocated to facilitate the data results.

·       The Herts Fraudhub had identified 800 records for review, with a small amount of fraud discrepancies already actioned.

·       There had been a new Council Tax Framework contract for 2025/26.

·       Work was ongoing with a Tri County Blue Badge prevention initiative, and a memorandum of understanding was expected to support the prevention and misuse of Blue Badges.

·       There was still an outstanding software issue with identifying urgent cases however, all cases had been processed within the urgent case timeframe.

The following Members asked questions:

·       Councillor Ruth Brown

·       Councillor Paul Ward

·       Councillor Vijaiya Poopalasingham

·       Independent Member John Cannon

In response to questions, the Counter Fraud Manager advised that:

·       The case management software provider had now confirmed that the system was unable to report on the processing of urgent cases. It was anticipated that this KPI would be changed for next year.

·       SAFs were ahead of target in delivering the required 267 days, the amber of KPI 2 was due to being part way through the civic year.

·       Due to pending legal action the details of the two housing cases were currently confidential however, details could be sent outside of this meeting.

·       Blue Badge parking was highly sought after and in certain parts of the country badges could be sold for a high price, leading to losses and misuse. In the summer the Civil Enforcement team, County Council and the Police worked together in a joint operation reviewing targeted areas for Blue Badge fraud. As a result of this operation a memorandum of understanding was being developed and it was hoped that this would become an annual exercise.

·       Organised fraud groups were targeting companies with mandate frauds, which were becoming more sophisticated and looked genuine as they  ...  view the full minutes text for item 37.

REPORT OF THE SHARED INTERNAL AUDIT SERVICE

To receive the Internal Audit Service progress report 2024-25 of the SIAS.

RESOLVED: That the Finance, Audit and Risk Committee noted:

(1) The SIAS Progress Report for the period to 25 October 2024.

(2) The implementation status of the reported high priority recommendations.

(3) The plan amendments to the 2024/25 Annual Audit Plan.

Audio recording – 23 minutes 28 seconds

The Head of Assurance presented the report entitled ‘SIAS Progress Report 2024-25’ and highlighted that:

·       The implementation of high priority recommendations from the Estates audit were taking longer than anticipated and now had a revised target date of March 2025, good progress had been made on this with full details at Appendix D.

·       The high priority recommendation on Agency Staff and on Houses of Multiple Occupation had been implemented.

·       The Project Prioritisation audit had been replaced by a Purchasing Card audit and this had had recently commenced.

·       The Churchgate Project Assurance audit had a change of approach and would no longer follow an embedded assurance approach and instead would be a more traditional ‘specific moment in time’ audit covering the period since the issue of the final reports for the two Churchgate audits completed as part of the 2023/24 Internal Audit Plan.

·       There had been changes to several audit start dates and this had meant a delay on commencing those audits, full details were available at Appendix B. It was not uncommon in Local Authorities for audit start dates to be moved at either the request of Council management or the internal audit team in some circumstances.

·       SIAS were confident that they would be able to deliver enough work to support the assurance opinion to be issued in May / June 2025. Resources were available to complete the plan.

The following Members asked questions:

·       Councillor Paul Ward

·       Independent Member John Cannon

In response to questions, the Head of Assurance advised that:

·       The Estates department were making good progress with the implementation of the high priority recommendation and a revised full implementation date had been set for 1 March 2025. There was ongoing cross checking of data sources occurring.

·       The final audit report in this matter had been issued in quarter 1.

·       Once the Estates department had accurately captured the data in Excel form, this would enable them to satisfy the recommendations in the case of alerts for review dates and update the asset register. A review could then be undertaken to decide if the current property management system needed updating, or if a new system would be more appropriate for the Council’s needs and to deliver the audit recommendations.

In response to questions, the Service Director – Resources advised that:

·       The Estates department were now fully staffed and this meant good progress was being made.

·       The full extent of current risks would be confirmed outside of this meeting.

·       It was felt that the Purchasing Card audit was a greater risk than the Project Prioritisation audit, especially as the new finance system had controls in place regarding projects. The audit would ensure that purchasing cards were used correctly and in line with policies.

·       The Peer Review and the new Council Delivery Plan covered off areas that the Project Prioritisation audit would have reviewed.

Councillor Paul Ward proposed and Councillor Tina Bhartwas seconded and, following a vote, it was:

RESOLVED: That the Finance, Audit and  ...  view the full minutes text for item 38.

REPORT OF THE SERVICE DIRECTOR – RESOURCES

To approve the current status of the audited Statement of Accounts for 2022/23, a draft is enclosed with the report as Appendix B and to note the progress made in the audit of the 2023/24 Annual Statement of Accounts.

RESOLVED: That the Finance, Audit and Risk Committee:

(1)   Noted the 2022/23 Annual Statement of Accounts as set out in Appendix B.

(2)   Delegated to the Chair of the Committee the final approval of the 2022/23 Annual Statement of Accounts. This would include confirming that the Chair of the Committee can sign the Statement of Accounts to confirm that they have been approved by the Committee.

(3)   Noted that the Annual Governance Statement for 2022/23 was approved by the Committee in September 2023, and that nothing has been identified since that date that would require a change to that Annual Governance Statement.

(4)   Noted the progress made in the audit of the 2023/24 Annual Statement of Accounts.

(5)   Noted the additional audit fees that have been notified by KPMG in relation to ISA315r of £11,597, which will be subject to approval by PSAA.

(6)   Noted the completion report and the process that would be followed for the approval of the 2022/23 Accounts as detailed in paragraph 8.13 of the supplementary report.

(7)   Formally thanked to Ernst and Young for their work and support to the Committee over the last eight years.

REASON FOR DECISIONS:

To ensure that the Council abides by the Audit and Account Regulations 2015, which require the approval and publication of audited Statement of Accounts. Furthermore, to meet the back-stop deadlines set out in the Accounts and Audit (Amendment) Regulations 2024.

Audio recording – 37 minutes 19 seconds

The Service Director – Resources presented the report entitled ‘Statement of Accounts 2022/23 and 2023/24’ and highlighted that:

·       There had been a supplementary document published on 13 November 2024 which included a completion report from Ernst and Young.

·       There was a date error in the third paragraph of the Executive Summary and the audit backstop date should read as 28 February 2025 for 2023/24 and the last sentence should read as 2023/24 instead of 2024/25

·       Due to failures in the public and private sector there had been a strengthening of audit requirements which resulted in audits taking longer. This had been made worse by Covid. The Government worked to resolve this and backstop dates for audits were agreed. These were then delayed by the general election and had now been passed by Government.

·       The first backstop date was 13 December 2024 for accounts for the financial year 2022/23 and before. Details of future dates were highlighted in paragraph 8.2 of the report.

·       The Committee was originally asked to review the report at Appendix B and delegate final approval to the Chair of the Committee however, the reports had since been finalised and published.

·       There was still a requirement to delegate final approval to the Chair and the Service Director – Resources, as minor adjustments would be made to the Statement of Accounts before it could be formally approved by the Chair of the Committee.

·       The Annual Governance Statement had previously been approved by the Committee and would be published alongside the Statement of Accounts.

Debbie Hanson, Ernst & Young, presented the report entitled ‘Completion Report for Those Charged with Governance’ and highlighted that:

·       The Interim Value for Money report was presented to the Committee in its June meeting and this was incorporated in this report.

·       Ernst and Young were required to report on materially and risks under the Auditing Standards requirements.

·       The requirements also included making checks with management regarding internal controls, compliance with laws and regulations, any significant fraud issues and good governance.

·       There was a requirement to make basic checks on the account such as checking that the opening balances were the same as the closing balances from 2021/22 and checks against the CIPFA disclosure checklist.

·       There were no specific issues at North Herts Council, the disclaimed opinion was the result of loal audit system wide issues and backlogs.

·       Had the audit been completed as normal, an applied level of Planning Materiality would have been set at £1.26M and this was detailed on page 17 of the supplement. These levels had been applied when reviewing any accounts errors.

·       The risks indicated in the plan had been similar to the previous year, they included the incorrect valuation of land and buildings and the pension liability.

·       Ernst and Young were required to confirm their independence as auditors, and this was stated in the report.

·       There had been no significant issues with the Value for Money Report. The basic checks on the financial statements had  ...  view the full minutes text for item 39.

REPORT OF THE LEGAL MANAGER / DEPUTY MONITORING OFFICER.

The report updates Members of the Committee on the LLG Code of Practice on Good Governance for Local Authority Statutory Officers. It contains a summary of the key objectives, roles and responsibilities.

RESOLVED:

(1)   That the Finance, Audit and Risk Committee noted the content of the report and Appendix A, and make any suggestions on future actions, particularly with reference to 7.6 and 7.7 of this report.

(2)   That the Code would be circulated as proposed under section 7.7 of the report.

(3)   That the Committee supported that the Council should formally adopt the Code as proposed.

REASON FOR DECISION: To ensure good governance within the Council.

Audio recording – 1 hour 1 minute 58 seconds

The Service Director – Resources presented the report entitled ‘Code for Statutory Officers (Head of Paid Service, Section 151 and Monitoring Officers)’ and highlighted that:

·       The Code ensured the good governance of the Council and had been presented to the Standards Committee in October 2024 for comments.

·       The Code covered the Statutory Officers namely, the Head of Paid Services, the Section 151 Officer and the Monitoring Officer, often referred to as the ‘Golden Triangle’.

·       The Council was required by statute to have these key Officers.

·       The Code summarised what the Council should do to ensure that they operated with good governance and that they had suitable measure in place to be efficient and listened to.

·       The Code sets out the requirements for resources and for Officers to share information, by communicating with each other. It was felt that the Code was already being achieved but needed to be formalised.

The following Members asked questions:

·       Councillor Ruth Brown

·       Councillor Paul Ward

·       Independent Member John Cannon

In response to questions, the Service Director – Resources advised that:

·       Additional recommendations could be proposed and seconded by Members of the Committee.

·       Investigations would be made with the Legal Team regarding formally adopting the Code.

·       The Golden Triangle roles had deputies, for the Section 151 Officer it was Antiono Ciampa, Isabelle Alajooz was the Deputy Monitoring Officer and the Service Directors deputised for the Head of Paid Services.

·       It may be prudent to have a more formal plan for any long-term absences of the Head of Paid Services

·       Deputies were invited to attend the Statutory Officers Group meetings and there was ongoing work on their training and the Statutory Officers training.

·       The foundations of the Code were already in place and adopting the Code would strengthen and formalise those procedures.

·       The Monitoring Officer in their role as Service Director - Legal and Communities was not able to deputise for the Head of Paid Services. The Section 151 Officer was able to deputise for the Head of Paid Services.

In response to a question the Head of Assurance referred to paragraph 8.1 of the report, Act Effectively and referenced the effective two-way support that Statutory Officers and the internal and external auditors provided.

Councillor Ruth Brown proposed, with two additional recommendations, and this was

seconded by Councillor Dominic Griffiths and, following a vote, it was:

RESOLVED:

(1)   That the Finance, Audit and Risk Committee noted the content of the report and Appendix A, and make any suggestions on future actions, particularly with reference to 7.6 and 7.7 of this report.

(2)   That the Code would be circulated as proposed under section 7.7 of the report.

(3)   That the Committee supported that the Council should formally adopt the Code as proposed.

REASON FOR DECISION: To ensure good governance within the Council.

The Chair to lead a discussion regarding possible agenda items for future meetings.

The Service Director – Resources confirmed that the Half Year Risk Report would be brought to the next Committee meeting and that risk training would take place prior to that meeting.

Audio recording – 1 hour 17 minutes 39 seconds

The Chair led a discussion regarding possible agenda items for future meetings.

Councillor Paul Ward requested training on the Risk Register and that mitigation against risks be considered.

The Service Director – Resources confirmed that the Half Year Risk Report would be brought to the next Committee meeting and that risk training would take place prior to that meeting.