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.

27.1     None

The Committee is asked to agree the minutes of the meeting held on 1 December 2023 (cream paper).

28.1     The Committee discussed and agreed an amendment to minute 22.2.  The final sentence was to be removed, and the penultimate sentence should end with ‘…going concern basis’.

28.2     Resolved – That the minutes of the meeting of the Committee held on 1 December 2023, amended as above, be approved as a correct record and that they be signed by the Chairman.

The Committee is asked to consider the verbal progress update from the External Auditor Ernst & Young (EY).

29.1     The Committee considered the verbal update from the External Auditor Ernst & Young (EY).

29.2     Mr Mathers (EY) confirmed that the outstanding actions for the West Sussex Pension Fund that had been reported at the previous Committee meeting were now complete.  There would not be an opinion issued until the County Council Financial Statements had been audited and completed.

29.3     Mr Mathers reported that EY were currently looking into the value for money considerations for the County Council and a report on this would come to the next Committee meeting.  SmartCore had been flagged as a project for consideration and a more detailed look had been planned.

29.4     Mr Mathers talked on the broader situation of audit nationally, and reported that a reset had been proposed for the end of September to allow legislation to come into force.  EY’s focus remained unchanged, and would continue with the pre-2022/23 audits to clear the backlog and the VFM work.

29.5     The Committee made comments including those that follow.

·         Sought clarity over the impact of the September reset.  – Mr Mathers explained that audit was in an unprecedented situation due to backlogs that were impacting the whole sector.  A reset had therefore been proposed to close any open audits.

·         Commented on the reset plan, and requested that wording at the time should reflect that the action is not a result of the County Council’s performance, but a requirement from the audit sector.  – Mr Mathers confirmed that wording would be considered nearer the time.  Mrs Eves, Director of Finance and Support Services, added that the reset plan had only been recently announced and the impact on the 2023/24 accounts would need to be understood.  The Chairman requested that a programme for the reset should come to the next meeting.  Mrs Eves added that the lack of announcement for the 2023/24 audit was currently making it difficult to plan works.

29.6     Resolved – That the Committee notes the update from EY.

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

The Committee is asked to note the Internal Audit Progress report.

30.1     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).

30.2     Mr Pitman, Head of Southern Internal Audit Partnership, introduced the report and highlighted that in respect of Joint Fire Control (JFC) the audit was not a review of the day-to-day operation of the Joint Fire Control as this is managed by Surrey County Council.  The limited assurance reflects the fact that there is currently no independent assurance provided to WSFRS over the operation of the JFC including IT systems, business processes and business continuity and the fact that the collaboration agreement does not reference or include an assurance clause describing where other sources of assurance will be provided from and which elements it would cover

30.3     The Committee made comments including those that follow.

·         Sought clarity on the progress of live reviews and how much chasing was required.  – Mr Pitman confirmed that officers were very accepting of Internal Audit management actions, particularly on high level actions.  Mr Pitman had reasonable confidence that all high level actions would be concluded by the end of March.

·         Noted that no actions had been completed for the Schools Thematic review.  – Mr Pitman explained that the actions had been delayed to align with the Department for Education’s Delivering Better Value programme.  Progress was expected by the end of January.  Mrs Eves confirmed that directors were encouraged to take ownership of actions and that they considered the report ahead of committee consideration.  Work was also being done to raise the profile of lower risk actions to ensure they were not missed.

·         Commented that work was needed to align works with the risk register and reflect on the impact of mitigations when dates were changed.  – Mrs Eves confirmed that it was important for the organisation to talk about risk and audit and make appropriate challenges to practices.  Mr Pitman worked with all directors to understand risks and their impact.

·         Noted the slippage on the SmartCore actions.  – Mrs Eves noted that the contract with DXC had ended in September 2023 and since then officers had been working to update the business case, noting that requirements had changed since its initial inception in 2019.  There was not a system implementor currently in place.  Work was being done to reflect on the whole project and look at lessons learned.  Officers were talking to other local authorities who use Oracle.  An agenda item was scheduled for the March meeting of the Performance and Finance Scrutiny Committee (PFSC) to consider the project.  Cllr Montyn, Chairman of PFSC, thanks Mrs Eves for the update and confirmed that PFSC was closely monitoring the project.  PFSC would be seeking sufficient reassurance on the progress of the project and a thorough update of all key elements.  Mrs Eves confirmed that officers were working on preparing for PFSC, and gave assurance that the project was now on the Finance and  ...  view the full minutes text for item 30.

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

The Committee is asked to approve the Internal Audit Plan 2023/24 (Q4).

31.1     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).

31.2     Mr Pitman introduced the report which outlined the audit plan for quarter four.  The plan which is built on the previous plan would work on improving key performance indicators to add value with early interventions.

31.3     The Committee made comments including those that follow.

·         Queried how the health and safety concerns that had been discussed at the previous agenda item could be incorporated.  – Mr Pitman agreed that the health and safety scope could be added.  If there were issues with scheduling, the committee would be informed.

·         Asked if the outcomes of the capital programme governance would come to a meeting.  – Mr Pitman confirmed that it would be included within regular progress reports.

31.4     Resolved – That the Committee approves the Internal Audit Plan 2023-24 (Q4), subject to the inclusion of the Health and Safety review.

Report by the Director of Finance and Support Services.

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

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

32.2     Mrs Chuter, Financial Reporting Manager, introduced the report and informed the Committee that there had been no breaches to treasury management or exposure limits for the quarter.

32.3     The Committee made comments including those that follow.

·         Queried the duration of the holdings for UK local authorities.  – Mrs Chuter confirmed that that, following the discussion at a previous committee meeting, this would be changed from February onwards from 20 years to 5 years, once the Treasury Management Strategy 2024/25 was approved at County Council.

·         Asked what happened when investments matured.  – Mrs Chuter explained that the cashflow model considered all requirements, including payroll, supplier payments, key income streams, etc.  Following this the horizon was monitored and reinvestments could be made if there were appropriate opportunities.

32.4     Resolved – That the report be noted.

Report by the Director of Law and Assurance.

The Committee is asked to note the updates in the report.

33.1     The Committee considered a report by the Director of Law and Assurance (copy appended to the signed minutes).

33.2     Mr Gauntlett, Senior Advisor – Democratic Services, introduced the report and informed the Committee that the 2022/23 draft had been considered at the July meeting.  The final version would be approved alongside the County Council Financial Statements in due course.  The report for consideration provided an update on action plans.

33.3     Mrs Eves informed the committee that there were missing recommendations from the report, and resolved to add these to the minutes from the meeting (copy appended to the signed minutes).

33.4     The Committee queried how the action plan was created.  – Mr Gauntlett explained that the Annual Governance Statement reflected the principles set out in the CIPFA Framework: Delivering Good Governance in Local Government, and ensured appropriate governance arrangements were in place.  The Executive Leadership Team (ELT) put the Statement together, bringing in comments from the committee.  The Statement was checked against CIPFA principles and ELT took ownership of the document, and the actions that would keep the Statement aligning with the Council Plan.

33.5     Resolved – That the report be noted.

Report by the Director of Law and Assurance.

The Committee is asked to endorse the proposed changes to Standing Orders on Procurement and Contracts for approval at a County Council meeting to enable the Council to utilise the processes as set out in the PSR when procuring contracts for health care services.

34.1     The Committee considered a report by the Director of Law and Assurance (copy appended to the signed minutes).

34.2     Mr Kershaw, Director of Law and Assurance, introduced the report and informed the Committee that the constitution required amending in line with a change in procurement legislation.  The changes referred to National Health Service procurement and would look to relax rules on competitive tender processes.  The Committee were asked to endorse the changes to standing orders to reflect the new legislation; and also changes that tidied related elements of the constitution.

34.3     The Committee made comments including those that follow.

·         Welcomed the changes that would add flexibility to procurements that would allow the required pace to reflect the changing market.

·         Proposed an amendment to section 19.7 to reflect the scenario were termination periods could be shorter that proposed in the text.  – Mr Kershaw resolved to consider the proposal and would report back to the committee.

·         The Chairman proposed that the changes should be monitored after implementation.  – Mr Kershaw proposed adding this to the Internal Audit plan.

34.4     Resolved – That the committee endorses the proposed changes to Standing Orders on Procurement and Contracts for approval at a County Council meeting to enable the Council to utilise the processes as set out in the PSR when procuring contracts for health care services.

The next meeting of the Committee will be held at 10.30 am on 11 March 2024 at County Hall North, Horsham. Planned agenda items include:

·       Quarterly Risk Management Report

·       Internal Audit Progress Report

·       Internal Audit Plan 2024/25 (Q1)

·       Work Programme 2024/25

35.1     The Committee noted that its next scheduled meeting would be held at 10.30 am on 11 March 2024 at County Hall North, Horsham.

The Committee is asked to consider in respect of the following item(s) whether the public, including the press, should be excluded from the meeting on the grounds of exemption under Part I of Schedule 12A of the Local Government Act 1972, as indicated below, and because, in all the circumstances of the case, the public interest in maintaining the exemption of that information outweighs the public interest in disclosing the information.

Resolved - That under Section 100(4) of the Local Government Act 1972, the public be excluded from the meeting for the following item of business on the grounds that it involves the likely disclosure of exempt information as defined in Part I, of Schedule 12A, of the Act by virtue of the paragraph specified under the item and that, in all the circumstances of the case, the public interest in maintaining the exemption of that information outweighs the public interest in disclosing the information.

Appendix 1 from the Internal Audit Progress Report (Agenda Item 6) is attached for members of the Committee only (yellow paper).

Exemption paragraphs:

2.   Information which is likely to reveal the identity of an individual.

3.   Information relating to financial and business affairs.

7.   Information relating to action taken for the prevention, investigation or prosecution of crime.

The Committee considered the exempt appendix and noted its contents.