Agenda item

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

The report of the Head of Audit and Risk providing an update as at 31 January, 2025 on the audits completed since the previous update as at 28 November 2024 was presented for the committee’s consideration. The report also set out the current workload of Internal Audit and its priorities for the short to medium term going forward. Members of the committee were provided under separate cover with copies of the assurance reports finalised in the period in relation to Housing Development (Reasonable Assurance) and Recruitment and Retention (Reasonable Assurance). A third piece of work completed in the period involved a Property Services related investigation conducted in response to allegations of favouritism with regard to electrical work procurement to which an assurance opinion did not apply.

The Head of Audit and Risk provided an overview of the two assurance reports completed during the period and she confirmed that an action plan had been formulated and agreed to with management to address the issues /risks and opportunities raised in each case. She elaborated on the investigation in relation to Property Services and advised that although the allegations of favouritism were not substantiated opportunities to strengthen fraud risk controls were identified and the findings of the review were reported to the Chief Executive, Portfolio Holder, Head of Service, and the Monitoring Officer. She referred to Internal Audit’s short to medium term priorities including work in progress as summarised in the schedule at paragraph 25 of the report along with the priorities for the longer term, and she briefed the committee on the latest position with regard to other developments including the introduction of the new global internal audit standards, CIPFA’s new code of practice for the governance of local authority internal audit effective from 1 April 2025 and the update by CIPFA and SOLACE to the guidance for local government on completing a review of the effectiveness of its system of internal control and production of the Annual Governance Statement.

In considering the report, the following were points of discussion by the committee –

• Whether the feedback to Housing Services from the review of Housing Development included any specific recommendations with regard to arrangements for monitoring value for money.

The committee was advised by the Head of Audit and Risk that the review found with regard to the Right to Buy scheme that although the Council is on track to meet its buy-back goal in terms of the number of properties acquired the absence of a formal financial viability assessment made demonstrating value for money difficult. Additionally, a formal buy-back acquisitions policy would strengthen governance arrangements and clarify the approach to buying back properties including the wider non-financial considerations that are taken into account when considering purchasing former Council owned properties.

·      Whether with regard to the review of recruitment and retention and the recruitment challenges faced by the Council in being able to attract suitable candidates, an analysis of the skills gap should be undertaken with a view to colleges targeting those areas where there are skills shortages.

The Head of Audit and Risk advised that the Council does have strong partnerships with local and regional colleges and collaborates with them on programmes and schemes to meet the local skills need including within the Council especially in relation to the care workforce. One of the main issues is a lack of candidates applying for roles within the Council. The Head of Audit and Risk confirmed that the Council conducts exit interviews to gain feedback from staff who are leaving.

It was suggested and agreed by the committee that a piece of work be undertaken to examine the benefits that working collaboratively with local and regional colleges has delivered in terms of enabling the Council to meet its recruitment and skills needs and fill vacancies.

·      The extent to which the pay differential between the public and private sectors for similar roles is a barrier to recruitment in local authorities and whether the grading structure in the Council needs to be reviewed to enable the Council to attract the right staff.

The committee was advised that the Council’s ability to change its pay levels is limited because local government pay scales are agreed and set nationally in England and Wales by the NJC. The pay scales comprise of different grades and scale points which correspond to a specific salary. Additionally, the nationally agreed Job Evaluation scheme whereby each post is systematically assessed and scored by an external assessor also means that there is limited scope to change pay levels to compete with the private sector.

·      With regard to the investigation of a complaint against Property Services, whether as part of the investigation process, a complainant should be required to meet with Officers to provide further information and/or help with inquiries if invited to do so and whether attendance should be a condition of proceeding with the investigation.

The committee was advised that the complainant in this instance had approached and spoken with the Portfolio Member for Highways Waste and Property and that Internal Audit is obliged to investigate if requested to do so by the Portfolio Member and by the Monitoring Officer.

In response to a question whether the Council is planning to respond to the current consultation on the addendum to CIPFA and SOLACE’s guidance on reviewing the system of internal control and production of the Annual Governance Statement the Head of Audit and Risk confirmed that the consultation had been forwarded to the Corporate Planning, Performance and Programme Manager who is responsible for compiling the Annual Governance Statement.

It was resolved to note the outcome of Internal Audit’s work, the assurance provided and priorities going forward.

Additional action – to request the Council to consider examining the benefits that working collaboratively with local and regional colleges has delivered in terms of enabling the Council to meet its recruitment and skills needs and fill vacancies.