·          

work was still ongoing in terms of the legal view on the Miel transaction; this would be discussed later in the agenda;

·          

testing on the revenue and journals had taken place and Members had been advised on what was intended to happen as well as the results so far;

·          

the valuation of property and plant equipment had been ongoing through the year focusing upon judgements and estimates made across land and buildings; additional testing had taken place on investment properties which was ongoing;

·          

the valuation of the pension fund net liability had been completed;

·          

there had been a number of changes to the disclosure notes in relation to the financial instruments; Council Officers had made necessary changes. Conclusion of the technical review of the accounts was now required to be completed as well as quality assurance measures.

·          

if the external auditor could give an indication as to when the investigation into the Miel transaction would be completed – it was responded that legal advice had been sought by Grant Thornton and an indication was given to them that advice would be provided this week. The advice then needed to be evaluated and for a final view to be made however this was a high priority and an assessment would be brought to the Council as soon as possible;

·          

how much the pension fund liability had been reduced because of the Miel transaction; it was responded that the pension fund liability was estimated at approximately £130m when the original proposition had gone out and was then subsequently revalued by the actuary in the region of £100m. By paying in advance the Council had saved several millions of pounds with was of significant gain to the Council;

·          

if the amount of money saved due to the accounting treatment of the pension liability fund was considered a fixed amount or a tangible figure and if this would affect the Council budgeting in an accurate way moving forward – it was responded that if the auditor considered that the accounting solution for this transaction was reasonable then the Council wouldn’t be required to pay extra contributions in the future and as a result the medium term financial plan would be in a more secure financial position. It was reiterated by a Member of the committee that the current administration inherited a budget that was sound so could proceed with confidence and that it wasn’t known until the last minute if grants applied for had been successful;

·          

was it considered that the Miel transaction treatment was defined as normal according to Local Government standards or unusual as considered by Grant Thornton? It was responded that the accounting treatment as a payment in advance was perfectly normal and local authorities  undertook that practice on a regular basis, and that it was the size of the prepayment which might not be considered as normal due to its  ...  view the full minutes text for item 37.

·          

more information surrounding bad debt provision; in response it was highlighted that the information on page 13 of the report linked to accounting estimates and related disclosures. There was ongoing work from the external auditor on revenue recognition for the19/20 accounts in particular around bad debt provision, and if it was sufficient to meet the requirements of the Council;

·          

why were Members being asked to consider non material considerations? In response it was highlighted that the accounting estimates and related disclosures were enhanced for 2021, so in previous years they're not material. If items weren't material, we wouldn't necessarily make any recommendations around improving how they are calculated. It would be a controls issue or just mentioned in our audit findings report, but if we're going forward into 2021, it's about how accurate the accounting estimates are, so you know are there any underlying items, for instance.

·          

was bad debt an issue and what was a material figure and what wasn’t? It was responded that the materiality figure for 2021 was £7,000,000 and the non-material figure was approx. £500k.

·          

generally the Council had sound systems of governance and risk in place and the midyear statement went towards the end of year audit report which fed into the Annual Governance Statement;

·          

high level pieces of work focused around cyber security; officers assessed the day to day controls that Delt Services (the Council’s IT provider) had in place and drafted a report with recommendations which was submitted to the appropriate director, detailing how the governance arrangements could be enhanced;

·          

each year officers would coordinate a response to the national fraud initiative and would provide reports to the Cabinet Office;

·          

one report was investigated under the Whistleblowing Policy; this was known to management and they had taken appropriate steps to help the situation. The policy worked however very few referrals were made;

·          

the Council had had its external review of public sector internal standards and had been advised by inspectors that officers continued to conform to the necessary standards.

·          

were there timescales for appointing an information security group, considering the increase in breaches of information affecting Council’s due to cyber-attacks? It was responded that the Council had an Information Governance Officer who was well renowned at a national level; there were processes and boards already in place focusing upon cyber security however the report drafted by officers would involve high level discussions between Delt Services and the Chief Executive – progress could be brought back to committee as to what was put in place;

·          

in appendix 1 of the report there were three areas rated amber and limited assurance was given – was this because work was not yet completed? In response it was highlighted that:

·          

there was limited assurance related to the DBS checks on recruitment as some governance levels and frameworks could be strengthened despite all checks being in place; the aim was to have a stronger structure and framework around that;

·          

there was limited assurance with regards to declarations of interest for Council Officers as the aim was to have a strong process that was embedded across the council as a whole to all officers across all levels knew what a declarations of interest was – this was forming a larger piece of work for HR;

·          

there was limited assurance around the Childrens additional spend (which was not material) as there were areas that could be strengthened and improvements could be made;

·          

was there a single central record for DBS checks at the Council? In response it was highlighted that there was an online system where the Council held their DBS  ...  view the full minutes text for item 40.

·          

was this fraud that happened over the counter, or trying to counter fraud? It was responded that the report detailed ways to counter different areas of fraud before they happened, however fraud also happened over the counter;

·          

did people report fraud direct to the team, as the current email address (corporatefraud.gov.uk) may put off residents by the fact that it referred to corporate fraud other than personal fraud? It was responded that several referrals were received via that email address and also phone from residents and other agencies providing intelligence. Both the Counter Fraud Services Manager and the Service Director for Finance were aiming to drive forward counter fraud in the coming months;

·          

there appeared to be blue badge misuse near the Plymouth Argyle ground on match days, was this being investigated? It was responded that the majority of blue badge misuse was because third parties were using a family members’ blue badge for their own use – there would be more fraud prevention exercises taking place around sporting events in the future;

·          

was the council spending more time on making sure people who had blue badges used them properly, or on working to ensure that those that were entitled to a badge received one? It was considered that people were required to pay for their blue badge therefore every time a badge was turned down, this affected their chance of mobility as well as money to the Council. It was responded that blue badge fraud was less frequent and officers were aware of the cost implications to the Council. Officers continued to raise awareness of this fraud and civil enforcement officers worked on a daily basis to monitor parking.

·        

what was the Leader’s span of control in dealing with risk management as it was considered that the overall decision maker might be prone to overriding the risks within the strategy – was there a firewall between who was leading this and the overall decision maker? It was responded that the Leader was active in reviewing the strategic risk register however the rating of the risk was the responsibility of the relevant director or service director who were accountable for the mitigation and implementation. There was considered to be a robust yet complex overall net of checks and balances whereby risk was checked at a numbers of levels within the Council;

·        

there was concern regarding the adult social care workforce and its fragility, was there anything further to add as the situation seemed to be worsening? It was responded that officers would continue to monitor the situation and would work to reinforce the residual element of the strategy to forecast the impact of mitigation and give timings to that which was key to managing risk;

·        

how many risk champions were there within the Council, who were they, who chose them and were they spread evenly across directorates? It was responded that there was at least one risk champion in each service area, directors were responsible for selecting who they felt was suitably placed to deliver the role and they helped with updates and coordination and carrying messages to and from the corporate centre;

·        

the Leader’s involvement with the risk register; it was responded that the Leader would discuss the register with Cabinet Members and they would lead the charge from the administration point of view. The responsibility and accountability for delivering the mitigation was worked up inside the service with the Director and Service Director. In terms of performance management, the increase in frequency enabled the ability to hold people to account. It was considered that 6 months was too long a period for red risks for formal monitoring and ensuring oversight in a formal way;

·        

how much time was there between a risk  ...  view the full minutes text for item 42.

·        

how new risks make it onto the risk register? It was responded that the rigor around risk management is something that was always sought to be improved. Risks were identified by those in prominent positions in senior management teams. There was a whole host of registers around the council, departmental, directorate ones and ones for projects;

·        

reassurance was sought as to the issues in childrens services which were experienced across the country and resulting in red risks; it was responded that issued faced by childrens services was a priority for the council and something the director and council as a whole was taking seriously.

·        

over the last 5 / 6 years the Council had been borrowing short term borrowing from other local authorities as it was cheaper due to low interest rates; the Council had approximately £460m of short term borrowing, and £140m of long term borrowing;

·        

in April 2020 the Council took out an interest rate swap that fixed £75m of borrowing at 0.56% for a 20 year fixed period;

·        

a new part of the strategy linked to treasury investments and the purchasing of commercial assets – the rules had now changed so that local authorities were not allowed to buy commercial property purely for income, however investments were allowed for job creation, to project jobs, and regeneration.

·        

the impact on the council of the government limiting grants;

·        

how investment in property benefited the authority; it was responded that investment created income for the city - in the future the Council was to look to different ways to create income as the Public Loans Works Board indicated that borrowing purely for income from purchasing commercial assets would no longer be allowed;

·        

the risk in Council’s buying assets and then there being a crash in the market affecting market value price resulting in a loss;

·        

who made the decision as to whether the investment by a council was for money making purposes; it was responded that officers of the council would make this decision and ultimately the S151 Officer;

·        

the risks involved for the Council if interest rates increased; it was responded that it was considered by advisors that the market would remain at a low interest rate level for the foreseeable future however the Council would assess short term borrowing to have a better certainty of debt;

·        

that in terms of capital expenditure, the £188m was financed with £151 – it was queried if money from previous years had not been spent? It was responded that the need to borrow was driven by the capital programme and that the council had been successful with big grants and other contributions and CIL monies.

·        

if the actions taken previously regarding the Miele transaction and debt reduction were on chief officer advice and in accordance with the council’s constitution? In response it was confirmed by the Service Director for Finance that decisions were taken entirely in line with officer advice and entirely in line with procedures that existed within the council at the time;

·        

as to the reason why additional guidance was needed if to date there had been no contravention? In response it was confirmed that section 5.2 in the constitution stated that a Cabinet Member may use their discretion to refer a decision to Cabinet however guidance surrounding when discretion would be relied upon would be useful. The guidance was not to correct a fault, but to give advice as to what should be considered when using discretion;

·        

that this was guidance and that rules were not being set out in the document.

1.

endorse the guidance set out at Appendix A of the report;

2.

approve the amendment to Part C: 5.2 of the constitution as shown in Appendix B of the report.

1.

authorise to proceed with the review of the terms of reference and identify ways to optimise the impact of the Audit and Governance Committee;

2.

convene a January Audit and Governance Committee to review the findings from the working group and consider recommendations (to enable a working group to continue to consider how improvements could be made to the functioning of the committee to support the panel in having a greater focus and impact on the Council).

·        

the change to the membership; specifically the lead opposition for health which was now suggested to be the opposition member – did this mean the opposition group were free to add anyone from the group to the membership, and who made this suggestion for the change? It was responded that this suggestion came from the Director for Public Health, and yes the opposition group were able to add any member from their group;

·        

the Chair queried the core membership as he sat on the Health and Wellbeing Board however wasn’t listed as a member in the terms of reference document - were other members included in the membership that were not listed on this document? It was responded that Plymouth extended beyond the core membership and that the Board took a decision back in 2012/13 to allow themselves additional members to meet the core objectives of the Board;

·        

if the extra members were subject to proportionality; it was responded that political proportionality didn’t apply to the Health and Wellbeing Board however to maintain that balance that was the approach. It was clarified the amendment to the Labour member was at the request of the Labour member of the Board;

·        

it was queried if one opposition member was enough and that if the lead member for health and adult social care, and children and young people were on the membership, should this be shadowed – could this be included? It was responded that given the development of the integrated care system going forward there were going to be a number of governance changes at a regional and sub-regional level. Reviewing changes to the terms of reference in light of those changes would be done by the council and the view there should be more opposition members would be included in the review;

·        

it was commented that a full picture of the core membership as well as those members that were also able to attend would help add context.

·        

the total cost of the local procurement and national procurement exercises for the appointment of the external auditor; Members were advised that detailed analysis would be provided for Member’s consideration;

·        

if the 2019/2020 accounts would be submitted to the January 2022 committee meeting and if there were any consequences of the accounts being late? It was responded that it was unlikely the 2019/20 accounts would be ready for the January 2020 committee meeting and that there were no consequences in terms of penalty to the council to publishing them late;

·        

concerns regarding the political impact the publishing of the 2019/20 accounts would have, especially during an election period. It was highlighted that there would be a difference in how communications would be deployed by the current administration in comparison to the previous administration had the accounts been published on time;

·        

when the January 2022 meeting should be scheduled.