Agenda and minutes

There were no apologies for absence.

There were no declarations of interest at this point in the meeting.

RESOLVED

            That the minutes of the Audit Committee held on 22 September 2014         be signed by the Chairman as a correct record.

(To receive a report which provides an update on the Council's fraud investigation activities and information on progress made against the Counter Fraud Work Plan 2014/15)

Consideration was given to a report which provided the Committee with an update on the Council's fraud investigation activities and information on progress made against the Counter Fraud Work Plan 2014/15. 

The Committee was advised good progress against the work plan for 2014/15 had been made and work in a number of key fraud pro-active areas had been completed, in particular around fraud awareness.

It was reported that seven fraud referrals had been received since April 2014.  Of these, there were currently three live cases and four which had been concluded.  There had been one successful prosecution since the last progress report which was a direct payments case, totalling just under £8,000.  The money was repaid in full to the Council by the perpetrator and they were also given a Community Service Order of 200 hours, and ordered to pay costs of £145.

Members were informed that all counter fraud and whistleblowing promotional material had been distributed throughout the Authority, including schools.  This would be supported by publications from the Council's Communication Team and repeated throughout the year to ensure maximum coverage.  It was also reported that officers had successful validated and uploaded data from 8 of the Council's systems for the 2014/15 National Fraud Initiative, a significant mandatory data matching exercise which was designed to provide participating bodies with the information to identify and investigate potential fraudulent transactions.  It was expected that the data matches for Lincolnshire County Council would be received early in 2015.

A £16m funding pot had been made available to local authorities to enable them to develop their counter fraud arrangements, and Lincolnshire County Council had submitted two bids which it was hoped would be successful, and the results were expected imminently.  It was noted that the two bids were for a grant for prosecution handling – to enable the Council to develop its capacity, expertise and governance framework to handle some or all of its fraud prosecution cases, and one for the Lincolnshire Fraud Partnership which recognised DCLG's desire for Local Authorities to work jointly against fraud, by creating a Lincolnshire Fraud Partnership which would comprise counter fraud specialists from the county council and the seven district councils.

Members of the Committee were provided with the opportunity to ask questions to the officers present in relation to the information contained within the report and some of the points raised during discussion included the following;

·         Schools which had converted to academies were able to make use of whistle blowing arrangements, and if they wished the authority would carry out fraud checks.  Officers would be carrying out some promotional work to make it known what services the authority could offer the academies;

·         It was confirmed that when somebody died, all relevant organisations were notified, but there could be a time lag with some of them.  However, the systems used in this process had improved greatly, including the interface between the adult care management system and the direct payments system;

·         It was commented that a care home  ...  view the full minutes text for item 29.

(To receive a report which provides the Committee with an overview of the Council's whistleblowing arrangements throughout the year 2013/14)

The Committee received a report which provided an overview of the Council's whistleblowing arrangements throughout the year 2013/14.  Members were advised that whistleblowing activity was consistent with the previous year and 17 whistleblowing disclosures had been received throughout the year.  It was noted that only four of these had been reported anonymously, which was encouraging.  Of the 17 disclosures, three required a full investigation and four were closed down with recommendations for management action.  Most were closed down with advice provided.  It was ensured that all organisational learning resulting from these disclosures was picked up.

Members were advised that the Policy was updated in 2013 to reflect some changes in the law, but it was believed that the whistleblowing arrangements remained effective.

The Committee was provided with the opportunity to ask questions to the officers present in relation to the information contained within the report and some of the points raised during discussion included the following:

·         It was suggested that the lower number of anonymous whistleblowing disclosures could indicate an improved confidence in the reporting arrangements, as staff were willing to share their identities.  Members considered this to be a positive step;

·         It was noted that one of the disclosures covered three different areas;

·         The whistleblowing arrangements were a method for use when staff did not feel confident in the established processes;

·         Feedback would always be provided to those who had raised an issue, even if there was no further action taken – unless contact details had not been provided;

·         It was clarified that 'no further action' meant that no management action was required or no policy changes were required.

RESOLVED

1.    That the whistleblowing activity for 2013/14 be noted;

2.    That the ongoing work to raise awareness and provide assurance on the effectiveness of the Council's arrangements be noted.

(To receive a report which provides the Committee with an update on the work undertaken in relation to the standards regime of the Council)

Consideration was given to a report which updated the Committee on work which had been undertaken in relation to the standards regime of the Council.

Members were advised that the Overview and Scrutiny Management Committee had commenced a full review of the Constitution over a year ago, and had established a cross party Constitutional Review Working Group.  It was hoped that the work would be concluded shortly and the final parts for approval would be going to Council in December 2014.

Members were advised that initial discussion had determined that there was a need for the Members Code of Conduct to be revised, but it was noted that the current version did achieve the requirements of the Localism Act.  However, it had less explanation than the LGA's model code.  It was reported that on 1 July 2012 the Standards Regime was changed under the Localism Act as it was felt that the previous legislation was no longer fit for purpose.  The national system was abandoned as a result of this and Councils were required to introduce their own local standards code and protocols.  This authority opted for a more streamlined code and no Standards Committee.

The Committee was provided with the opportunity to ask questions to the officers present in relation to the information contained within the report and some of the points raised during discussion included the following:

·         Advice to members if they had concerns regarding declaring interests was always to over declare rather than to under declare;

·         Under the new arrangements, once it had been concluded that there had been a breach of the Code of Conduct, the Audit Committee would need to convene a sub-group which would determine what action was to be taken;

·         It was important to note that it was not the role of officers to judge members in relation to breaches of the Code of Conduct, and councillors should be the ones who judge their peers;

·         It was noted that all authorities had their own way of dealing with standards issues, some had kept a standards committee whilst others had abolished them;

·         It was queried how it would be monitored whether interests were not being declared.  Members were advised that officers would not police councillors to ensure they were declaring everything they needed to, as the Code of Conduct required members to be responsible for their own declarations.  However, members were periodically reminded that there was a need to update their interest forms if their situations changed;

·         It was thought that a system whereby members could update their forms online would be useful, and a more database based approach which could be interrogated more easily was being considered;

·         It was also suggested that the forms that members were required to complete could be redesigned as they did not always promote the right response;

·         Members commented that they also found it useful that there was someone within Democratic Services that they could go to when they needed to update their interests form;

·         It was commented  ...  view the full minutes text for item 31.

(Discussion around how well the Council's governance and assurance arrangements are working in these times of uncertainty and change.  The impact on the assurance arrangements following organisational change, fundamental budget reviews and the potential impact on management and corporate assurance functions)

The Chief Executive and all Executive Directors were invited to attend a Panel discussion around how well the Council's governance and assurance arrangements were working in the times of uncertainty and change, as well as the impact on the assurance arrangements following organisational change, fundamental budget reviews and the potential impact on management and corporate assurance functions.

The Chief Executive was invited to open the discussion and provided an introduction, he reported that it was only in recent years that the authority had had to start making reductions to its budget, but it was believed that this was starting from a good place.  However, in some cases change was managed so well that people's perceptions were that nothing had changed.

The headlines of the changes were straight forward – the funding of the authority had reduced by a quarter, and the number of staff had also reduced by a quarter from four years ago.  The authority would have considerably less funding available over the coming four years.  During this period, paradoxically, productivity had increased and this could be for a number of reasons - the authority was finding more efficient and effective ways of doing things, and people being concerned about job security.  The increased efficiency masked the fact that workloads had increased, as there were more children in care, and the number of adults requiring care had also increased for example.  This was something that could be misunderstood and was a risk as there were fewer people doing the same amount of work. 

On a positive note, it was reported that Lincolnshire was well ahead in responding to these changes when benchmarking against other authorities.

It was commented that one of the main issues was the County Council becoming a commissioning authority and that there were underlying concerns regarding whether the county council would have sufficient control over the organisations that would be delivering the services on behalf of the authority. 

Members were reminded that becoming a commissioning council did not mean that all services would be outsourced, but that in house services would be treated in the same way as contracts.  Each service would be examined and it would be determined what outcomes and objectives were required, and what level of budget was available to achieve them.  This would determine the most appropriate delivery model.

Discussion took place over the degree of control that should be exercised over services which the authority no longer needed to deliver.  Officer acknowledged that different management skills were needed, such as a commercial attitude.

The Committee welcomed Sean Hanson, the Managing Director of Serco, who was in attendance to respond to any concerns the Committee held in relation to the contract between the County Council and Serco.

The relationship with Serco would be very important in the coming years.

It was noted that the Value for Money Scrutiny Committee had looked at the Serco contract in great detail prior to it being signed, and assurance would be needed that the contract would  ...  view the full minutes text for item 32.

(To receive a report which presents the Committee with the revised Financial Procedure 6 for review and comment)

Consideration was given to a report which presented the revised Financial Procedure 6 for review and comment.  It was reported that this procedure formed part of the Financial Regulations and Procedures in the Council's Constitution, and aimed to inform staff and members of the mandatory requirements and provide guidance on good practice in risk management, counter fraud and insurance.

Members were provided with the opportunity to ask questions to the officers present in relation to the information contained within the report and some of the points raised during discussion included the following:

·         Training material would be provided in relation to thinking about risk for members and officers;

·         Managers were responsible for ensuring that staff within their teams received all relevant and appropriate training;

·         Risk management training had not been made mandatory, in order to make it mandatory a steer from the Executive Director for Resources and Public Protection would be required;

·         Most training was dictated by the service needs.  Training was also delivered through continuous professional development and on the job training.  It was therefore difficult to quantify the amount spent on training by the Council outside of training budgets;

·         Risk management had been built into people's overall development, and would be approached differently in different areas.

RESOLVED

            That the comments made in relation to the revised Financial procedure      6 – Risk Management be noted.

(To receive a report which provides the Committee with information in relation to the core assurance activities currently scheduled for the 2014/15 work plan)

Consideration was given to a report which provided the Committee with information on the core assurance activities currently scheduled for the 2014/15 work plan.

It was noted that information requested at the previous meeting in relation to debtors and domestic violence had been included in the report.

Members were provided with an update on progress against the action plan.

It was confirmed that David Hair, Scrutiny and Member Support Team Leader would be presenting a report at the meeting on 26 January 2015 on Scrutiny and its relationship to the Audit Committee.

It was noted that feedback regarding a recent training session which had been held by CIPFA on Effective Audit Committees had been positive and members commented that it had been useful to meet with colleagues from other authorities.  It was also noted that positive feedback had been received from the districts.

RESOLVED

            That the Audit Committee's work plan and action plan be noted.