Agenda and minutes

Members and officers must declare any pecuniary or personalinterest in any business on the agenda. They should also make declarations at any stage such an interest becomes apparent during the meeting. Consideration should be given to leaving the meeting if the nature of the interest warrants it.  If in doubt please contact Democratic Services before the meeting.

23.1     Cllr Greenway declared a personal interest as a deferred member of the Local Government Pension Scheme.

The Committee is asked to agree the minutes of the meeting held on 22 September 2021 (cream paper).

24.1     Resolved – That the minutes of the meeting of the Committee held on 22 September 2021 be approved as a correct record and that they be signed by the Chairman.

The Committee agreed the Statement of Accounts 2020/21 at its last meeting and agreed that the Chairman sign them, but also then sign any final version if there were only minor amendments. Small changes were eventually made to note 43, as set out below. The Committee is asked to note that the Chairman has signed the final version of the statement of accounts that includes the changes shown in bold italic type below:

Extract from Note 43 - Assumptions made about the future and other sources of estimation uncertainty

The external valuer instructed by the Council adopts various estimation techniques to arrive at their valuations. The Authority changed its valuer in 2020/21, and a different technique applied by the new valuer in relation to school assets has had a significant impact on the Council’s balance sheet. Bruton Knowles have applied a ‘Modern Equivalent Asset’ (MEA) approach, whereby for Depreciated Replacement Cost (DRC) valuations (such as for schools), the valuation is based on the cost to construct an asset with equivalent service potential rather than a like-for-like replacement of the existing structure which was the approach adopted in the prior year by the Council’s previous external valuer. Additionally, Bruton Knowles have distinguished between ‘developed’ and ‘undeveloped’ land in their school valuations, whereas the previous valuer adopted a ‘blended’ approach in the prior year.’

25.1     The Committee noted the minor amendment that had been made to the final version Statement of Accounts 2020/21 since they had agreed the accounts at the September meeting.

The Committee is asked to consider the updated and final 2020/21 Audit Results Report and the draft 2020/21 Auditor’s Annual Report from the External Auditor Ernst & Young (EY).

26.1     The Committee considered the Final Audit Results Report from the External Auditors EY, and also a draft copy of the 2020/21 Auditor's Annual Report (copies appended to the signed minutes).

26.2     Mrs Thompson (EY) introduced the Final Audit Results report and reported that an unqualified opinion had been issued and that there were no value for money issues to report.  Property Plant and Equipment and Pension Liability work had been previously outstanding, but these areas were now satisfactorily complete.  The final certificate had not been issued due to the outstanding delay in the release of the data collection tool for whole of government accounts.  It was hoped that the information would be issued in December to allow the relevant assurance work to be completed.

26.3     Mr Mathers (EY) gave an update on the areas that had been considered since the September meeting.  There had been a change in valuation techniques used by the County Council which EY had looked into.  EY were satisfied that the change in approach to valuations were a reflection of the valuer’s techniques and confirmed that an external valuer had concluded that assets had been recorded correctly.  EY had commented that the Horsham Enterprise Park should have a more granular approach taken for its valuation for increased accuracy.  On the Pensions Liability, it was confirmed that EY had tested the actuary’s model work and were satisfied that it was correct.

26.4     The Committee made comments including those that follow.

•    Queried when the Horsham Enterprise Park would be revalued and if the value was impacted by the market.  – Mr Mathers explained that the valuation would be done annually and that a new figure would be expected in the next statement.  Mr Hunt explained that work was still ongoing for the park and that negotiations were taking place.  It was recognised that the value of the park would change as the usage was developed.

•    Sought clarity on the £7.8m adjustment for pension liability.  – Mr Mathers confirmed that the asset values had increased in the audited accounts and that the original figure was based on estimated asset data.

•    Noted the change in valuer and the techniques used, and asked if this made it difficult to monitor valuation changes.  – Mr Mathers explained that EY were satisfied with the approach taken, but had asked for a disclosure to be included in the statements to add an explanation.  The technique change occurred in instances where a school’s rebuild value was considered differently.  The previous valuer would value the cost to rebuild the school the same, whereas the new valuer would use a value to build a new school based on anticipated pupil numbers.

•    Queried if the Department of Education looked into the County Council’s figures.  – Ms Eberhart, Director of Finance and Support Services, confirmed there was no requirement for this.

26.5     Mrs Thompson introduced the draft copy of the 2020/21 Auditor's Annual Report and explained that a new format had been used.  ...  view the full minutes text for item 26.

Report by the Director of Finance and Support Services, and the Head of Southern Internal Audit Partnership.

The Committee is asked to note the status of overdue medium and low priority management actions (October 2021).

27.1     The Committee considered a report by the Director of Finance and Support Services, and the Head of Southern Internal Audit Partnership (copy appended to the signed minutes).

27.2     Mr Pitman, Head of Southern Internal Audit Partnership, introduced the report and explained that the report was included following a request made at the September Committee meeting.  The report added the requested detail for medium and low priority actions and Mr Pitman confirmed that progress continued to be made in the areas.

27.3     The Committee made comments including those that follow.

•    Sought clarity on the Trade Union Consultation on Organisational Change which was due in 2008.  – Mr Pitman did not believe the issue had been discussed since then, but confirmed there had not been another formal revision since.

•    Requested that where due dates were revised they should include the details for previous dates.

27.4     Resolved – That the Committee notes the status of overdue medium and low priority management actions.

Report by the Director of Finance and Support Services.

The Committee is asked to review the information detailed in the report and current Corporate Risk Register, and provide comment as necessary.

28.1     The Committee considered a report by the Director of Finance and Support Services (copy appended to the signed minutes).

28.2     Mr Pake, Corporate Risk and Business Planning Manager, introduced the report and confirmed that CR69 for Children’s services had reduced to 15 and that there was no longer a requirement to work from home and so CR71 had been removed.

28.3     The Committee made comments including those that follow.

•    Queried where the mental wellbeing element of CR71 had moved to.  – Mr Pake confirmed this was now covered within risks CR11 and CR50.

•    The Chairman of the Health and Adult Social Care Scrutiny Committee (HASC) noted the pressures for CR68 and confirmed that the Scrutiny Committee was aware if the issues.

•    Queried what mechanisms were in place to monitor progress and ensure that improvements did not create issues elsewhere.  – Ms Eberhart acknowledged that the scope of CR68 covered a large area, but confirmed that HASC were looking into it.

•    Noted that some areas of the Register did not have dates for actions.  – Mr Pake confirmed that efforts were made to add dates where possible.  Some issues were long term and where dates were removed dialogue was added to explain works.

•    Queried if the take up of the Risk Management Lunch ‘n’ Learn sessions was measured.  – Mr Pake confirmed the Learning and Development team monitored all courses.

•    Queried the risk progress for Adult and Children Service areas.  – Ms Eberhart explained that this was within the remit of the scrutiny committees.  The Committee agreed to write to the Scrutiny Chairmen to seek reassurance that they considered the risks within their remits and raised concerns appropriately.

28.4     Resolved – That the Committee notes the information detailed in the report and the current Corporate Risk Register.

Report by Director of Finance and Support Services.

The Committee is asked to recommend to County Council the acceptance of the invitation from the Public Sector Audit Appointments Limited (PSAA) to continue to be an opt-in authority for the purposes of the appointment of an external auditor for both West Sussex County Council and West Sussex Pension Fund.

29.1     The Committee considered a report by the Director of Finance and Support Services (copy appended to the signed minutes).

29.2     Mrs Chuter, Financial Reporting Manager, introduced the report and informed the Committee that the appointment of the external auditor was a five year cycle and the report outlined the options for the next term, with an officer recommendation to opt-in to a Sector Led Body appointment.

29.3     The Committee queried if there were any local authority options for a joint procurement.  – Ms Eberhart confirmed that there had been no County level discussion and that most had proposed to stay with current arrangements due to the gains of being under the Public Sector Audit Appointments Limited (PSAA) arrangement

29.4     Resolved – That the Committee recommend to County Council the acceptance of the invitation from the Public Sector Audit Appointments Limited (PSAA) to continue to be an opt-in authority for the purposes of the appointment of an external auditor for both West Sussex County Council and West Sussex Pension Fund, for the period 1 April 2023 to 31 March 2028, under the provision of the Local Audit and Accountability Act 2014 and the requirements of the Local Audit (Appointing Person) Regulations 2015.

Report by the Director of Finance and Support Services.

The Committee is asked to review and comment on the Treasury Management Compliance Report.

30.1     The Committee considered a report by the Director of Finance and Support Services (copy appended to the signed minutes).

30.2     Mrs Chuter introduced the report and informed the Committee that there had been no new external borrowing and there had been no policy breaches within the quarter.

30.3     The Committee thanked officers for including maximum investment levels for a number of exposure limits, as requested at a previous meeting.

30.4     Resolved – That the report be noted.

The next meeting of the Committee will be held at 10.30am on 17 January 2022 at County Hall, Chichester.

31.1     The Committee noted that its next scheduled meeting would be held at 10.30 am on 17 January 2022 at County Hall, Chichester.