Agenda and minutes

To receive any declaration of interest by any Member or Officer in respect of any item of business.

No declaration of interest was received.

To present the minutes of the previous meeting of the Governance and Audit Committee held on 29 June, 2022.

The minutes of the previous meeting of the Governance and Audit Committee held on 29 June, 2022 were presented and were confirmed as correct.

To present the report of the Head of Profession (HR) and Transformation.

The report of the Head of Profession (HR) and Transformation incorporating the Corporate Self-Assessment 2021/2022 was presented for the Committee’s consideration.

Councillor Robin Williams, Portfolio Member for Finance, Corporate Business and Customer Satisfaction presented the Isle of Anglesey County Council’s first Corporate Self-Assessment report which had been prepared to fulfil the new duty placed on councils in Wales by the Local Government and Elections (Wales) Act 2021 to keep their performance under review through self-assessment. Under the Act, each authority is expected to consider the extent to which it is exercising is functions effectively; it is using its resources economically, efficiently and effectively and whether its governance is effective for securing the two aforementioned matters, and it must publish a report setting out its conclusions for each financial year. The report for the Isle of Anglesey County Council 2021/22 reflects the output of the corporate planning and performance management framework at the Council and is the end of a process that brings together several different aspects of the framework. Councillor Robin Williams said that having considered the evidence provided in the form of the service performance reviews; performance reports; Annual Governance Statement; external reviews; staff survey and stakeholder engagement the Council is satisfied that overall its performance management, its use of resources and its risk management are “Good” and reflect many strengths. Notwithstanding, the self-assessment has also highlighted areas where things can be improved and these issues are brought together at the end of the report and the source of assurance for each issue is noted.

The Chief Executive reported that the self-assessment report being the first of its kind for Anglesey under the new performance requirements introduced by the Local Government and Elections (Wales) Act 2021 is positive and encouraging but recognises also that further progress can be made with regard to certain aspects of performance. He stressed that the Council has been able to fulfil the duty placed upon it by the Act without having to introduce any new performance management approaches - the processes, procedures and arrangements that form the basis of the self-assessment are already well established within the Council. He hoped that this conveyed the message to all the Council’s stakeholders, partners and regulators that the Council is operating from a sound base and that many of the Act’s expectations in respect of performance are already embedded in the Council’s day to day work. He believed that there was much to be proud of in the report and that the Council could be satisfied that the arrangements it has in place help build improvement without adding additional bureaucracy. Performance management is part of the Council’s culture and continues to mature; the management and use of resources while challenging is supported by robust arrangements and risk management forms an integral part of the Council’s day to day operations and decision-making. Areas that have been identified for improvement will form part of an action plan and will be monitored for progress by the Leadership Team and reported  ...  view the full minutes text for item 3.

To present the report of the Head of Profession (HR) and Corporate Transformation.

The report of the Head of Profession (HR) and Transformation incorporating the draft Annual Governance Statement (AGS) for 2021/22 was presented for the Committee’s consideration.

Councillor Robin Williams, Portfolio Member for Finance, Corporate Business and Customer Satisfaction presented the draft Annual Governance Statement for 2021/22 which demonstrates how during the year, the Council’s governance arrangements fulfilled each of the principles contained within the CIPFA/SOLACE Framework for Delivering Good Governance in Local Government.

The Council is responsible for ensuring that it conducts its business in accordance with the law and proper standards and that it safeguards and properly accounts for public money and how public money is used. The Council also has a duty under the Local Government and Elections (Wales) Act 2021 to make arrangements to secure continuous improvement in the way in which its functions are exercised, having regard to a combination of economy, efficiency and effectiveness. In discharging this overall responsibility the Council has also a duty to put in place proper arrangements for the governance of its affairs, facilitating the effective exercise of its functions which includes arrangements for the management of risk together with adequate financial management. The Council approved and adopted a revised local code of corporate governance in March, 2022 which is consistent with the principles of the CIPFA/SOLACE Framework. The AGS shows how the Council has complied with the Code and meets the requirements of proper practice and Accounts and Audit (Wales) Regulations.

The Head of Profession (HR) and Transformation said that the Annual Governance Statement and the previous Self-Assessment Report complement each other. She confirmed that while no significant governance matters were identified in 2021/22 the self-assessment process did identify the governance issues listed at page 10 of the report that will be addressed during 2022/23.

In the ensuing discussion the Committee made the following points –

·                     Requested clarification of action 3 in the table on the progress made in 2021/22 on governance matters identified during 2020/21 wherein it was confirmed that matters [pertaining to the Local Government and Elections (Wales) Act 2021] requiring attention in 2021/22 had been implemented but stated also that further work on remaining matters needing attention was planned for 2022/23.

The Chief Executive clarified that some elements of the work had been completed and implemented and that other elements e.g. reviewing and updating the Constitution and introducing a Petition Scheme are work in progress to be completed in the current financial year.

·                     Requested clarification of point 3 in the table which lists governance matters identified by the Self-Assessment process wherein it was stated that failure to comply with new responsibilities and changes introduced by the  Local Government and Elections (Wales) Act 2021 could lead to further scrutiny by Welsh Government and a loss of reputation.

The Chief Executive clarified that the Act imposes new duties and responsibilities on the Council some of which have been implemented and others which are work in progress which if not fully implemented could have a reputational impact on the Council. It  ...  view the full minutes text for item 4.

To present the report of the Director of Function (Resources) and Section 151 Officer.

The report of the Director of Function (Resources)/Section 151 Officer incorporating the draft Statement of the Accounts for 2021/22 was presented for the Committee’s consideration.

The Director of Function (Resources)/Section 151 Officer reported that the draft accounts were signed on 16 June, 2022 and are now being audited. He highlighted that additional work in connection with confirming the valuation of the Council’s assets in the balance sheet might mean the audit process takes longer to complete; the issue arose during audits in England the previous year and has been raised with each council by Audit Wales. The Section 151 Officer clarified that Audit Wales is seeking assurance that the impact of changes to the current value of assets is not such as to amount to a material change in terms of the figure provided for by the accounts. While councils are not being asked to revalue their assets, what it means as regards the requirement on councils has been the subject of discussion between Audit Wales and CIPFA. The Council has asked its Principal Valuation Officer to undertake further work in respect of the valuation of the Council’s assets which may lead to a delay in completing the audit.

The Director of Function (Resources)/Section 151 Officer highlighted the following –

·         The Statement of the Accounts consists of the core financial statements listed in the first page of the accounts. These are preceded by the Narrative Report which is a key section of the accounts and which provides an effective guide to the most significant matters reported in the accounts including the Council’s priorities and strategies and the principal risks it faces. The narrative report provides a commentary on how the Council has used its resources during the year to achieve its stated objectives.

·         The draft Comprehensive Income and Expenditure Statement shows the cost of providing services in the year in accordance with statutory accounting requirements and covers both the Council Fund and the Housing Revenie Account. It includes accounting adjustments such as depreciation and pensions adjustments which are not funded by Council Tax payers so the impact of these are excluded in the note called Adjustments between Accounting Basis and Funding Basis (Note 7 in the Statement of Accounts). This note for 2021/22 shows £11.852m of accounting adjustments which are cancelled out in the Movement of Reserves Statement. This means that the true impact on the Council and HRA reserves from the provision of services is reduced from a surplus of £5.940m to a surplus of £17.792m which is an increase in Council reserves. This is due to an underspend on the Council Fund and Housing Revenue Account and transfers into earmarked reserves.

·         The balance of all usable reserves as at 31 March, 2022 was £57.772m, an increase of £17.792m. The HRA Reserve, School Balances and Capital Receipts Reserves are ring fenced and can only be used for the designated purpose. Table 1 of the report provides a summary of the movement in reserves due to the financial performance of  ...  view the full minutes text for item 5.

To present the report of the Head of Audit and Risk.

The report of the Head of Audit and Risk incorporating the Committee’s Forward Work Programme and Training Programme for 2022/23 was presented for the Committee’s consideration.

The Head of Audit and Risk advised that the Forward Work Programme has been developed to accommodate the Committee’s new responsibilities under the Local Government and Elections (Wales) Act 2021 and the consequent amendments to the Committee’s terms of reference and that it also reflects an additional meeting requested by the Committee which has been scheduled for October. In response to a question about the governance of partnerships and collaboration agreements, the Head of Audit and Risk confirmed that the Annual Report of the Partnerships and Regeneration Scrutiny Committee would be presented to the Committee’s December, 2022 meeting.

It was resolved to accept the Forward Work Programme proposed for 2022/23 as meeting the Committee’s responsibilities in accordance with the terms of reference.