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There is no summary of this meeting yet. One is written once the council publishes the minutes. The agenda and papers are below.
No declarations of interest were made.
No members of the public were present.
The action list from the last meeting was noted. 1. Key collaborations: The Performance and Data Insight Manager provided an update to the Committee that a draft list of key collaborations was complete ready to share with Internal Audit and the Strategic Leadership Team prior to adding to the Forward Work Plan. Action Status: Open (Recommend to Close - 24th November 2022) 2. Cross-referencing Reports with the Committee’s Terms of Reference: The Chief Internal Auditor will review Governance and Audit Committee reports against the Committee’s terms of reference. Going forward, he will ensure that reports on the Forward Work Plan have a cross reference. Action: Open (Ongoing until March 2023) 3. Internal Audit Outturn Report: i) Invite service managers to next meeting re: Limited Opinions (Concessionary Travel) and Fleet (Health and Safety and Driver Management): This item is on the agenda for today’s meeting. Action Status: Closed ii) Provision of Fraud figures (not percentages): The Chief Internal Auditor advised that the information has been collated and commentary added to circulate to Committee Members. Action status: Open (Recommendation to Close – 24th November 2022) 4. Action List: The action list has been reformatted Action status: Closed 5. Statement of Accounts: i) The Acting Assistant Head of Finance stated the amendments have been made and the document will be finalised by this Committee at the next meeting. Action status: Open (Recommendation to Close – 24th November 2022) ii) 20mph speed limit scheme and funds availability for scheme reversal: A response will be circulated by the end of the week. Action: Open (Recommendation to Close – 24th November 2022) 6. Audit Wales Quarterly Update and Timetable: The Audit Wales Assurance and Risk Assessment report is on the agenda for the meeting today. Action status: Closed 7. Audit Wales Springing Forward Report: i) The Chief Internal Auditor and Deputy Chief Executive are meeting with the Chair; scrutiny arrangements for the people and asset strategies will be discussed. Action status: Open ii) The Chair will discuss progress against interim key milestones at the above meeting. Action status: Open iii) Update and Completion of Corporate and Community Plan: The Performance and Data Insight Manager explained that the Plan is on the agenda for Cabinet next week and will be considered by Council on 27th October 2022. The Plan sets an initial direction to be further developed. The full Plan is scheduled for publication in early 2023 alongside the budget. Action status: Open 8. Whole Authority Strategic Risk Assessment The Chair offered support on the actions listed at the last meeting to close them by the end of the calendar year. The Performance and Data Insight Manager explained that the Risk Register’s revised format will take account of the comments made and a draft version will be shared with the Chair. The Housing risk has been re-assessed as “High”. The risk register has been amended accordingly. Action status: Open (Recommendation to Close – 24th November 2022) 9. Scheduling meetings closer to quarter ends: Removed from the action list. Action status: Closed
The Deputy Chief Executive provided a presentation on the arrangements in place for anti-fraud, bribery and corruption. The Chief Internal Auditor confirmed that Internal Audit considered the CIPFA tracker report and data analysis to identify key frauds nationally, their relevance to Monmouthshire and to ensure appropriate mitigation is in place. Following the presentation, questions and feedback were invited: · A Member asked about cyber risk, specifically: - if staff training and refresher courses are available; - if it is mandatory for relevant staff; - how the profile of anti-fraud, bribery and corruption is raised with staff; and - if there is a whistleblowing policy. The Deputy Chief Executive confirmed the existence of a whistleblowing policy; communicated to staff upon induction. It was accepted that the training is a work in progress, also the degree to which it is mandatory. Work is in hand to introduce a new learning management system to assess individual training needs, including mandatory training for each role. The Chief Internal Auditor informed the Committee that the draft training for anti-fraud, bribery and corruption had been presented to the previous Committee and was rolled out to Internal Audit and Procurement staff. There is further refinement required before further roll out to all relevant staff. The Anti-fraud, Bribery and Corruption Policy is available on the Intranet and will be on the Internal Audit page on The Hub. The Whistleblowing Policy is available on The Hub should a member of staff wish to report concerns. Induction training will include online anti-fraud, bribery and corruption training. Regarding cyber risk, the Deputy Chief Executive noted that this is contained in the Strategic Risk Register. An annual report on the Management of Cyber Security is on the Forward Work Plan and the previous report will be made securely available to committee members. · A Member asked if there is enhanced vetting for key staff. The Deputy Chief Executive explained that safeguarding checks are made via DBS (Disclosure and Barring Service). There are no financial checks or checks for criminal activity. The Deputy Chief Executive will contact the Member outside the meeting to discuss further. · A Member enquired about any benefits or impact on procurement due to the collaboration with Cardiff City Council. The Deputy Chief Executive explained that it is proving to be a good collaboration that has enhanced capability and expertise. Other councils in the region are now considering the same arrangement. It was explained that the procurement strategy is scrutinised by the Performance and Overview Scrutiny Committee. The Chief Internal Auditor explained that audits include checks on compliance with council policies and procedures including the Contract Procedure Rules and Financial Procedure Rules. · A Member queried if there is a user-friendly guide for raising concerns (including a process to determine the level of concern). The process for members of the public to raise concerns was questioned. The Deputy Chief Executive informed the Committee that the policy will be updated this financial year to include simple guidance. The Chief internal Auditor explained that there are several ways an allegation is reported. Often concerns will be made directly to him. An assessment in terms of substance will be made. If appropriate a direct referral will be made to the Police. Members were informed that they may make concerns relating to bribery, fraud, or corruption to the Chief Internal Auditor. All new Members are to be made aware of this route of referral. The Committee considered the Council’s approach to anti-bribery, fraud, and corruption. Overall, it was considered that the arrangements are effective. There is a relatively low incidence of fraud but no room for complacency especially in respect of cyber security.
The Audit Wales Officer introduced the Audit Wales Assurance and Risk Assessment Review of Monmouthshire County Council. The Council’s Management Response was provided by the Performance and Data Insight Manager. Following presentation of the report and the Council’s Management response, questions were invited: · A Member queried the recommendations of the net zero strategy especially the elements included in the new Community and Corporate Plan with a proposed completion date of July 2023. It was questioned how much had been incorporated into the interim plan and what is to be developed for the longer plan, and medium-term financial strategy. The Head of Policy, Performance and Scrutiny responded that the new Community and Corporate Plan will be considered by Cabinet next week, then by Council. The Plan is relatively light touch adjusting the direction of the budget set by the previous council. There are many ideas and contributions yet to be considered and possibly added to the final version which will be aligned with the new budget. Poverty and inequality, and decarbonisation and climate change are the two overriding priorities and will be aligned with any resetting of the climate and nature emergency strategy to embed in further actions. · In response to a question, the Deputy Chief Executive explained that there is not an explicit management response to the points raised by Audit Wales on the Medium Term Financial Strategy as the Council has separately provided a management response to the recommendations contained in an Audit Wales financial sustainability review confirming our strategy for medium term sustainably; this can be circulated separately. The Audit Wales Officer confirmed that there are no recommendations on medium term financial planning in this report because there are two outstanding proposals for improvement in the previous financial sustainability report. These relate to more sustainable savings planning. Officers assured that once the new council was in place there would be a new medium-term financial plan containing a longer-term approach to savings planning. Progress will be reviewed at the end of this financial year. · A Member asked where the boundary of carbon footprint is drawn referring to the energy consumed working from home, as that element needs to be accounted for. The Head of Decarbonisation, Transport and Support Services said that there is a standard carbon baseline assessment for all public sector that includes commuting. The matrix does not yet include working from home but there has been a discussion with WG on factoring this in. The Member suggested this was an aspect Welsh Government and Audit Wales should consider. It was confirmed that an update on last year’s carbon baseline assessment will be presented to Council in December 2022. The Chair commented that after due consideration, the Council’s Management response is adequate. He noted the significant financial challenges facing the Council which may impact the timetable for completing some of these actions.
The Audit Wales Officer presented the Annual Grants Report that summarises the key findings of Audit Wales’s work on claims and returns for 2020/21. The report is delayed this year because of Housing Benefit work, and due to the pandemic. Following presentation of the report, questions and comments were invited: · A Member asked if Audit Wales is generally satisfied with the standard of reports, and if there were any common or repeated issues that management should be addressing. It was confirmed there are no recurring themes year on year. Housing benefit claims are complex to audit and frequently, different issues appear. There is a good relationship with the Benefits Team and no specific concerns. · A Member asked and was informed that the Benefits Team is alerted to underpaid benefits to ensure the correct payments reach claimants. · A Member referred to the NNDR (National Non-Domestic Rates Return) and problems identifying empty properties for payments. The authority is required to verify empty properties ready for claims but, due to the pandemic, were unable to go out to confirm properties were empty for the entire period being claimed. This was the same for all authorities. There were other sources of evidence that provided some assurance. · Noting four of five claims were qualified, a Member asked about the outcomes. Audit Wales submits findings to the grant paying bodies and it is their decision to act. The Deputy Chief Executive confirmed that the amounts are trivial, so comeback was unlikely. Overall, there is a good control environment. The Audit Wales Officer will feed a message back to suggest that grant awarding bodies have a minimum threshold. Summing up, the Chair drew comfort from the report’s conclusion in that there were sound arrangements in place and noted that the qualified opinions were solely due to the identification of a few minor, technical breaches.
The Chief Internal Auditor introduced the report on limited opinions explaining that the Governance and Audit Committee had invited Service Managers and Heads of Service to provide an update on progress. The Committee had the option to accept the assurances provided which will be verified with a follow up report as included in the Audit Plan or if explanations from the Managers are not accepted, then the Committee can raise concerns with the Chief Officer and SLT to escalate their concerns. 1. Concessionary Travel: i) Hardship payments totalling over £46k had been claimed from Welsh Government which had not been invoiced for by the operators or paid over to them: The Passenger Transport Unit Manager explained that the report is focused on a Local Government Concessionary Travel Scheme funded by the Welsh Government. During the pandemic Welsh Government agreed that operators were to be paid at pre-pandemic levels to provide sustainability of bus services. At time of the audit these payments were being paid to the operators. The limited opinion regarding payments of £46,000 being claimed from Bus Emergency Scheme 2 (BES2) but not paid out links into other grant funding schemes. The money to be repaid was from English corporate operators who were going to sign up to the BES2 scheme, but they had funding from the Department for Transport instead. This was added to the claim as it was close to the end of the financial year (unknown if they would apply) and the money was repaid to the Welsh Government in full. The issue won’t recur as, from 1st August 2022, Welsh Government has returned to actual claims not historic. The money had been accrued before for this financial year and now it has been paid back to Welsh Government at Quarter 4. ii) Quarterly Claims: The Passenger Transport Unit manager explained that there has been an issue with signing off forms to send to Welsh Government at the end of the quarter with a deadline of the 20th of the following month. This allows little time to receive details from the operators and return the form. Addressing the comment that they were submitted without the signature of the s151 Officer, this was confirmed as correct as these were draft reports. The audit process is that the finance team checks to make sure the ledger agrees with the return. The return can then be signed by the s151 Officer. Previously, it was only the final return that was returned to Welsh Government with signature by the s151 Officer. The quarterly returns were signed by the Head of Service. An e mail from Welsh Government explained that the 20th day of the following month for the submission of concessionary fare claim forms was chosen as half of the authorities submitted either a final or a draft version of the claim form within that timescale but Welsh Government understood that when the operators return the information affects when an authority can submit a final signed form. There is an issue obtaining invoices from corporate operators. Ticket machines information is provided so claim forms can be submitted but the invoices can come from a central office causing delays. iii) The Grant terms and conditions letter: The Passenger Transport Unit Manager explained that the grant letter has been received late from Welsh Government due to its internal sign off processes. The example was quoted of the 2022/23 concessionary fares and Bus Services Support Grant (BSSG) award letters dated 30th August have only just been released. iv) Internal guidance documents and procedures to ensure the scheme was administered within Welsh Government expectations: The Passenger Transport Unit Manager explained that such guidance would be in place within a month. v) Operators claims not supported by Smartcard data: It was explained that there was a problem with two operators that didn’t have the ticket machine data due to being in the process of transferring to different systems. That has now been rectified and the ticket machines return 98% swipe rate. English operators run into Wales and none of the ticket machines are compatible with Welsh Smartcard data. Welsh Government is aware and has agreed to accept a spreadsheet from those companies instead of the Smartcard data vi) Dates for submission of claims from operators have not been set, resulting in these being regularly received late: It was explained that dates have been set. It is up to the operators to submit the claims. The claims often come from a centralised office or volunteer staff and can be delayed vii) Monthly reports are available to help identify potential fraudulent behaviour: The Passenger Transport Unit Manager explained that there was a problem when Welsh Government’s supplier changed from ACT to Fujitsu and since then, the reports have arrived in zipped format and can’t be opened. This has been investigated with SRS and Fujitsu to try and open the reports. The reports show how many people have used their cards over ten times or use them very frequently over a short period of time to enable checks and monitoring of vehicles. It is hoped to resolve this before the end of November. The Chair was surprised that zipped files could not be opened. It was responded that other authorities have the same issue. viii) The Authority does not have a programme in place for inspectors to board vehicles which are used to carry concessionary passenger for spot checks on processes and the number of passengers carried: It was explained that work is underway on resuming checks but resources are limited. ix) Minor errors were identified in two of the historic figures used within the 2021/22 Quarter 1 BES2 calculations: This has been rectified. x) Overall claim balances relating to the first two quarters of 2020/21 had not been settled or recorded in the financial ledger system: Payments were changed by Welsh Government. During Covid, authorities were given interim payments to replace quarterly payments in arrears to make sure there was cash flow. These were reconciled at year end. When quarter 1 and quarter 2 were checked, they wouldn’t have been reconciled at that point but would be reconciled at year end. The Chair thanked the Passenger Transport Unit Manager for the explanations and noted the dependency on third parties in some cases which has affected the ability to act on audit recommendations. Questions from Committee Members were invited: · A Member asked about the potential for operators to defraud the system and if it would be worthwhile appointing someone to monitor this. It was confirmed that the information collected is useful e.g. it was detected that an operator had swiped the card multiple times. This was reported to Welsh Government. · A Member queried why the grants letters are sent to the Chief Executive and it was clarified that Welsh Government had been asked to send the letters to officers as well in future. The Officer was asked if there were barriers to progress. It was reiterated that meeting the deadline of the 20th of the month is very difficult and this is acknowledged by Welsh Government. A draft, unsigned form is submitted and it shouldn’t be expected that the S151officer signs an unchecked form. The Chief Internal Auditor raised the formal acceptance of grants not being returned to WG within the 21-day deadline. Assurance was provided that the deadline will be met going forward. The form will be sent to officers to ensure that it gets signed off within the 21-day deadline. · A Member said there the lack of clarity over whether the recommendations are accepted or not and understanding where third parties are involved. It was enquired if other authorities have the same concerns. The Chief Internal Auditor said it was difficult to confirm the position of other authorities, but they work to the same terms and conditions. The audit process identified the expected controls that should be in place for concessionary travel. The scope is agreed with the Service Manager who is expected to provide the appropriate information to enable an audit against the procedures and policies. Some strengths and weaknesses were identified, and the weaknesses far outweighed the strengths hence the unfavourable opinion. By way of comparison, the Passenger Transport Unit Manager stated that half of the other authorities get their claims in on time so there is a difference there. · A Member suggested a review of the processes that aren’t in place mid-next financial year so they can be changed or improved. The Chief Internal Auditor explained that in normal circumstances, a limited opinion would be followed up. There was a delay in finalising this report so a follow up review is not included in the 2022/23 Audit Plan but it will be added to Quarter 1 for 2023/24 to ensure the recommendations have been acted upon and there are improvements in the system to report back to committee. The Chair thanked the officer for attending to provide explanations. Some continuing control weaknesses are evident, but the wider situation is understood. The Committee will look forward to receiving further updates in due course 2. Fleet Health and Safety and Driver Management: The Head of Decarbonisation, Transport and Support Services welcomed the opportunity to offer some explanation and context in relation to the limited audit opinion, noting that some of the recommendations were not agreed at the time of the report. It was explained that, at the time of the report, all budgets relating to Fleet, Health and Safety and Management were devolved to individual service areas and it was contended that there were no levers available to make adjustments to address the report’s recommendations. i. There was no central management of the Health and Safety of Fleet and Driver Management within the Authority: It was explained that the fleet team budgets have now been centralised, the recommendation is agreed and is in progress. New information is available from starter and termination forms to identify to the transport team those new staff who are required to drive and those who have left their role. A new Accident Investigation and Training Officer undertakes driver induction and assesses ability to undertake a role. A Utilisation Officer post is to be recruited. Work is in progress on documentation and overall, good progress has been made. ii. Lack of Policies and Procedures: These are in development. Some policies and procedures lie within the remit of Fleet. The Drug and Alcohol testing procedure is being worked on by the Training Manager who is working on the policy. A draft drivers’ handbook is subject to consultation. It is planned to present a Vehicle Tracker Policy to Joint Advisory Group (JAG) in November to progress its adoption. iii. Training documentation was incomplete: At the time of the audit individual service areas training records were not kept. All the training undertaken is now recorded on a spreadsheet to be uploaded to the new training portal when introduced. Individual records are not recorded for more job specific training e.g. chainsaw training. Managers will be expected to upload that data to the new training system when operational. iv. There was no Accident Policy or formal guideline in place. At the time of the report, accident reporting was managed by the insurance team and there was a procedure in place. Accidents must now be notified to the Accident Investigation and Training Officer to investigate and if necessary, arrange or instigate disciplinary action. v. The reason for vehicle trackers and information usage was not clearly defined and documented: A Vehicle Tracker Policy will be presented to JAG in November prior to its adoption and implementation. A tracker system is installed on every vehicle to provide data on vehicle utilisation to begin to reduce the fleet. This is an important part of the decarbonisation agenda. Routes can be identified to explore opportunities to share vehicles and investigate the most suitable vehicles for purpose. Trackers can assist where there are queries from the public e.g. alleging drivers travel at excess speed. vi. Quartix (vehicle tracker) user list was not regularly reviewed: This has now been resolved. New starters and terminations are notified. The system is monitored on a quarterly basis to make sure that those who need access to Quartix have access. Those who don’t need it will be removed from the list. vii. Policy on speeding: This is contained within the Vehicle Tracker Policy and in the new handbooks to be distributed shortly. Details of how the information will be used and expectations of drivers (and their managers in ensuring compliance) with not just speeding but all highway code regulations and legislation will be included. · A Member asked about the policy on drugs and alcohol, and the criteria on speeding. It was explained that this data would be retrospective based on information from a tracker. The Drug and Alcohol Policy was not developed by the transport team. It is a corporate policy yet to be finalised. It is possible testing would be done at the base if there was cause for concern. The authority has an obligation to report any speeding incidences to the traffic commissioner. Service Managers are expected to advise all colleagues regarding speeding. If there are repeat incidences, tracker data can support the disciplinary. Process. · The Member asked if retrospective speeding records are admissible to other authorities, how speed can be tracked and how that could apply to the driver’s employment. The trackers provide live data, but someone would need to review the data; there are no alerts. A new officer will undertake checks against the tracker systems and then advise individual managers if drivers exceed the speed limit. It is planned to use the tracking data to inform us of utilisation of the vehicles rather than driver behaviour but confirmed that the data can be used to support investigations into poor driver behaviour/persistent speeding. The data can also be used to safeguard drivers to verify or refute complaints from members of the public. · A Member asked if there were any barriers preventing progress. It was explained that the centralisation of the budget has enabled progress on the audit recommendations. Weaknesses are transferring to strengths. It is hoped that there are no delays in ensuring the new policies and procedures are approved. When approved, data will be utilised more effectively to facilitate transition to net zero vehicles. · A Member asked if the Fleet Team had been reviewed. The team has grown by two officers (Accident Investigation and Training Officer and Utilisations Officer) with both roles anticipated to enhance the service provided. The Chief Internal Auditor welcomed the comprehensive feedback and assurance provided. The follow-up review is included in the Audit Plan for 2022/23 (Quarter 2/4). The Committee was content with the feedback provided.
The Performance and Data Insight Manager introduced a report to provide a quarterly update on the Council’s progress against the Audit Wales Work Programme and its management response to relevant recommendations for local and national reports. Following presentation of the report, questions from Committee Members were invited: · The Chair referred to the current economic position and emphasised the importance of officers further strengthening key elements of the Medium-Term Financial Plan (MFTP). Continuing, the Chair suggested that the MTFP needed to be based on a range of plausible scenarios and subject to stress testing. It was the Chair’s opinion that the Committee doesn’t have sufficient visibility over the end to end MTFP process nor an understanding of the key financial operational assumptions underpinning the plan. Regarding proposed savings to deliver a balanced budget, the Chair advised that it is essential that the Committee understands where these cost savings will be made and to gain assurance from officers that this does not materially impact levels of internal control, governance or other matters that appear on our work programme. The Chair will raise these points with officers. The Deputy Chief Executive stated that there is a level of assurance provided to the Governance and Audit Committee around the budget process. Last year the S151 officer opinion statement was presented to the committee ahead of the budget being approved so the committee could reassure itself of the robustness of the budget process and the adequacy of reserves. If the Committee wants to strengthen assurance, a Cabinet report can be made available that provides context and an outline of the budget process. Additionally, the MTFP strategy will be presented to Council in December/January and a draft version can be presented to the committee. · A Member commented that considering measures to close budget gaps or anticipate what will happen over the next four years is difficult for this committee and suggested that scrutiny committees would be better placed to consider this on an ongoing basis. The Chair, Chief Internal Auditor and Deputy Chief Executive will meet on Monday to consider more fully the Committee’s role in reviewing the MTFP and budget recovery plan with a specific emphasis on ensuring its work complemented that of the Performance and Overview Committee). It was considered that the Governance and Audit Committee should focus on control and process when discussing the budget to assure itself of the means by which savings are identified, how risk and consequences are assessed as a result of that and financial sustainability over the medium term. Some discrete elements fall to this committee, others to the Performance and Overview Scrutiny Committee. · A Member, referring to national studies, asked where the response to net zero fitted in the scrutiny process. It was confirmed that the response to climate emergency strategy action plan falls to the Performance and Overview Scrutiny Committee. The Chair, in summary said the Committee carefully reviewed the progress made in addressing the points made by Audit Wales and is generally satisfied with the current position noting the comments made by Members.
The Governance and Audit Forward Work Plan was noted · The Deputy Chief Executive highlighted the potential risk to the closure of the audit process on the accounts from being finalised that may affect presentation to Committee in November. CIPFA was consulting its members and local authorities in terms of infrastructure assets and FRAB (Financial Reporting Advisory Board) has drawn some conclusion that is not helpful. Audit Wales and Welsh Government need to work through some matters and that might impact on the audit process. An update from Audit Wales was requested. · The Q3 Internal Audit Progress report was moved from March to February 2023.
The minutes of the previous meeting held on the 8th September 2022 were confirmed as an accurate record. The agenda item will be amended to “approve” instead of “confirm” the minutes in future.
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