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There were no apologies for absence.
There were no Declarations of Interest from Members relating to items to be considered on the agenda.
The Chair was authorised to sign the minutes of the previous meeting, held on 30-09-2022, as a correct record. Issues Discussed: · Questions: Minutes: Question Response Page 5 – Insurance Cover for Members on outside bodies. This was raised previously as Members are not protected in the case of insolvency. Before the Committee receives an update on this matter can Members be contacted to warn them of the issue as representatives of the Council on outside bodies. Officer Response: The Committee will receive an update on this matter at the January 2023 meeting, and in the interim an email will be sent to all Members asking them to check what insurance arrangements are in place with outside bodies relating to their membership of those bodies. Page 7 – In relation to housing risk. Following discussion with the Head of Housing, there are other options available to the Council other than compulsory purchase which are an empty dwelling management order and the Council could purchase the properties for housing associations or social housing so there are other mitigating factors to address that risk. Officers made no comment. The Chair asked that Councillor Lewington’s remarks be noted and that this can be taken forward as an action to seek clarification to support what Councillor Lewington was seeking to achieve. Page 7 HoWPS Intellectual Property – is there any progress following the last meeting. Officer Response: The Head of Finance had sought and obtained assurances and an update from the Service about the transfer of intellectual property from HoWPS back to the Council. The Head of Finance was awaiting a further opinion from the Head of Legal Services regarding the information provided. Outcomes: · Head of Finance to email all Members asking them to check what insurance arrangements are in place with outside bodies relating to their membership of those bodies. · That clarification be sought from the Housing Service regarding what action the Council could take regarding empty dwellings. Decision Tracker: Question Response Page 13 - Debt Policy. The current policy had been shared with the Committee as requested. However, the Committee had not had the opportunity to consider the policy and there was some concern about the levels of authority for debt write off. Officer Response: This can be added to the work programme for a future meeting. Comment: · The Chair commented that in relation to the deep dive into the risk of social care provider failure this review was specifically around the commissioning of services and the financial sustainability of providers, rather than a holistic review of social care. Outcomes: · Review of the Debt Policy to be added to the Committee’s Work Programme. · Risk Deep Dive of Social Care Commissioning and financial sustainability to be added to Work Plan for agenda of meeting on 9th February 2023.
Documents Considered: · Report of the Leader and Cabinet Member for an Open and Transparent Powys. · Annual Governance Statement. Issues Discussed: · The Annual Governance Statement (AGS) provides an account of the processes and systems which the Council has in place to demonstrate the effectiveness of the Council’s governance arrangements during 2021-22. · The statement is centred around the seven CIPFA principles and the SOLACE framework. A level of assurance should be provided for each of the principles to demonstrate the extent to which the Authority judges itself on its performance. An overall assurance should also be provided. · Modification has been made during the last year to the AGS process. · Principle A to F have been scored at substantial and Principle G as Reasonable. The overall assurance is set as Reasonable. · 18 of the 22 planned actions listed have been completed or on schedule with only two rated as red. · In terms of process a review would be undertaken to consider the process for next year and would be recommending to the Cabinet and the Committee an improved process to allow the Committee time for its views to be provided to Cabinet for consideration. · The Leader commented that he had been reassured by the report although there were still improvements to be made such as in relation to Principle G – transparency and accountability. · Questions: Question Response Could you provide clarification on revisions to the process. This was presented to the Committee at a seminar in July rather than a formal meeting. Given the importance of the Committee’s approval, will this be considered formally by the Committee in its final form in future and if there is substantive comment from the Committee how is this reported back through the Cabinet and the auditors. If there were any comments today how would this feedback loop be achieved. Officer Response: The self assessment process was a new process for the Council this year under the Local Government and Elections (Wales) Act 2021 and this was aligned with the Annual Governance Statement. A meeting of officers had been arranged to review the learning from this year and to suggest revisions to the process for future years. The revised process to be reported back to the Cabinet and the Committee. However, there is a need to approve the statement so that there is no delay to the approval of the Pension Fund accounts. The Executive Management Team (EMT) has been rigorous in looking at the actions arising from the Annual Governance Statement (AGS) last year and how these were delivered as well as what improvements were needed. Page 25 - 5.1 is blank – should this be “none”? Can you clarify who determines the assurance levels, what is the process for determining the final assurance level. Officer Response: EMT worked through the document with Heads of Service this year to consider the levels of assurance. EMT will repeat this next year, seek assurance from the Cabinet and then it can be considered by the Governance and Audit Committee, and if required can be reconsidered by Cabinet prior to final approval by the Committee. Audit Wales in addition undertake a review of the AGS as part of the audit of the Council’s accounts and review the evidence provided as well as having a view on the assurance levels. Outcomes: · That the AGS is noted and considered alongside the Pension Fund Accounts at item 7 on the agenda. · That a report be presented to the Committee on the revised process for the Annual Governance Statement for 2022-23, date to be scheduled on workplan.
Documents Considered: · Report of the Cabinet Member for Finance and Corporate Transformation. Issues Discussed: · The report set out the Quarter 2 position at the end of September 2022. · As the bank rate had continued to increase there has been an increase in the short-term money market investment rates and the Council had been holding any surpluses to manage day to day requirements earning interest of around £180k this year. · There was a revised agreement between the Council and Welsh Government in respect of the Global Centre for Rail Excellence which led to the repayment of £15.6m of the £33m repayable funding which the Council held for the project. · The current capital programme is £96m including the Housing Revenue Accounts. · Inflation was having a significant impact on capital schemes. · There had been a large increase in PWLB (Public Works Loans Board) interest rates since the beginning of the year. Last year the Council took out borrowing at a rate of 1.35% over 50 years and this year that same borrowing would have been at just under a rate of 4%. · No debt had been repaid early during the quarter but some loans had been repaid since and would be reported in the next quarter. Some debt that was due to mature had been repaid, £1.5m (PWLB) and £5m from other local authorities. £5m was due for repayment in the next quarter. · Sundry debt increased slightly from that reported in the last quarter. However, it was noted that not all debt could be collected immediately and was deferred, as for example it was set as a charge against a property and therefore only collectable at a future point in time. · Questions: Question Response Paragraph 3.24 - Public works loan – what is the likelihood around the purchase of assets for yield and what is the governance around this. The approach being taken is a very prudent approach Officer Response: There is nothing in the capital programme or the five year plan. This would have to go through the capital governance process to be included in the capital programme. The implications of this would need to be made clear on the remainder of the capital programme. Yes we would be taking a prudent approach. Sundry Debt and Adult Social Care - what type of activity do you find in terms of pursuing deliberate deprivation of assets. Officer Response: Not in a position to respond to this question. With regard to repaying loans early – why if the borrowing is at favourable rates would you do this. Officer Response: None of the borrowing is linked to a specific scheme. The council has debt with different interest rates. Recently guilt markets had increased which enabled the Council to repay loans early with only a small penalty. Overall, this creates a saving to the Council Paragraph 3.48 – reference to the debt recovery team – there are five members of the team but it is currently carrying vacancies. Can you give assurance that we are making efforts to fill these vacancies as the concern is that the team is under strength. What does the role entail and that this is a priority. Officer Response: This is an element which has been focussed on recently. The Service has identified the potential to increase the team by one if an additional person can be recruited. The structures of teams in Financial Services was also being reviewed to provide greater resilience across the Service. The Council has recruited successfully to all but one vacancy, but was also looking to increase the size of the team so there would be two vacancies to be filled. Is there anything that can be done to give more certainty as far as Treasury Management is concerned Officer Response: The key to this is the project managers in monitoring projects and anticipating when spend is going to be incurred or where there is slippage and incorporating this into financial profiles. Training has been undertaken across Service teams to put this in place. The Finance Team meet with project managers on a quarterly basis to get revised forecasts as this impacts on the revenue budget. It is more difficult to forecast spending where schemes were being delayed or where schemes were multi year schemes. If staff are working at home, do we need to sort out terms and conditions as staff cannot claim back for working at home any more where expenses were paid previously. Does this need to be included in the budget in the future. Officer Response: Arrangements had already been sorted out and conversations had with staff. Where staff were receiving an allowance they have been compensated for changes in contractual obligations. Claims for travel had not changed as where staff were based remained the same. What about Members as they could claim tax relief previously for working from home. Officer Response: The position for Members would be different from staff as they were classed as home workers and their base was their home. Table in paragraph 3.42 – Adult Services - £1.5m outstanding debt with the Local Health Board. Why is this treated separately and is there any additional commentary. Officer Response: There was a change of finance system some years ago and that debt was not brought across into the sundry debtors system which was why it was reported separately as it was not included in the new system. Page 151 Annex – purchase cards. The level of resolvable errors seems to be high. What is the approach to monitoring and manging purchase cards use. Officer Response: These are monitored quite carefully to ensure that VAT is claimed back. If staff do not follow the guidelines cards can be withdrawn. SWAP was intending to review the use of purchase cards as part of the audit programme. There are sufficient processes in place to monitor this. Due diligence exercises were also being undertaken to make sure that the Council was not overclaiming on VAT. Outcomes: · Noted.
Documents Considered: · Report of the Head of Finance Issues Discussed: · Fraud and money laundering policies are in place. Further communications had been issued reminding staff and the public about the work of the fraud team. · In the next quarter it was intended to roll out the mandatory Fraud Awareness Training Package to staff and Members. The Service was also planning to roll out Member training conducted by Dyfed Powys Police. · Quarter 3 activity – error review activity work being undertaken. Currently there were 32 fraud cases ongoing, and in 28 cases 4 cases found proven fraud activity. · Section 3.4 – in the next quarter’s report the Service would be seeking an indication from the Committee regarding the team’s for the next year. · Section 3 – Gains. The overpayment gains to date were £210k across all the team’s work, which were recoverable errors. Income gains is where the work of the team had stopped an error or fraud multiplied over a 52 week period. · Investigations had not produced anything of significant concern to bring to the attention of the Committee. · Section 6 was an overview of the structural changes and work to respond to the Audit Wales and SWAP recommendations. Much of the activity had been completed or was on track with some requiring further progress. · Questions: Question Response Quarter 3 activity report – table on page 155. From the 28 cases of proven fraud what did we learn from those cases and what is being put in place to stop those types of fraud happening again. Section 4 - It is good to see the £1.1m worth of gains made. However, does this indicate gaps in the controls framework. What is the learning and actions being put in place to stop this happening again. Officer Response: As part of the improvement an investigation panel has been created. From the start to end of a fraud case the Service considers whether there are any fraud risks to be concerned about to be raised with Services or the S151 Officer. Any recommendations are identified at the end of the fraud process and the plan was to incorporate any learning into workshops in future to develop better risk management in Service areas. In terms of gains it might seem that there were a large number of gains but with the type of activity there will be errors. However, if the overpayment gains were higher than the income gains this would be of concern as problems were not being identified earlier. Having overpayment gains low was a good position for a Council as it means that problems are being stopped earlier. With gains, much of this fraud is external fraud rather than internal fraud. Powys is part of the South West Audit Partnership and the Council receives routine fraud alerts so the Council can be more vigilant. What is the timescale to address the issues raised in Appendix 1. Some of these could be addressed quickly, for example updating the whistleblowing process and fraud awareness training for Members and officers. The Council used to share good practice and working for other authorities relating to fraud – do we still have this capacity. Officer Response: The elements of the appendix from the audit recommendations were dealt with in the table under Section 6.1. Commercial services were being provided to other Councils which were mainly English Authorities. This work was paused during covid and subsequently stopped following the restructuring of those authorities. This work would be reconsidered in future. In our risk assessments do we include court costs such as for the Crime Prosecution Service or police undertaking prosecutions. Officer Response: The Council takes its own cases to court and would use its own solicitors to prosecute rather than use the CPS. Those costs would be included. There have been invitations sent out recently to residents to participate in ECO 4 projects. However, there have been issues about ensuring that only those people eligible for the scheme were being approached. Are you satisfied that the appropriate measures are in place. Officer Response: The Service needed to have a conversation with Trading Standards that claims on leaflets were appropriate. There had been engagement with Trading Standards about that issue. If there were any fraudulent activity relating to the scheme this would be a matter for the Trading Standards service rather than the fraud team as this type of fraud was against the public and not the Council. Comments: · The Cabinet Member for Finance and Corporate Transformation suggested that Heads of Service should be urged to ensure that staff had read the fraud awareness guidance on netconsent (currently 650 staff had not read this information) to address this issue. Outcomes: · That Heads of Service be asked for an assurance that they were ensuring that staff had read the fraud awareness guidance on netconsent. · The Assistant Director (SWAP) to provide an update on the fraud risk assessment for Powys.
Documents Considered: · Pension Fund Accounts · ISA 260 · Letter of Representation Issues Discussed: · The Pensions and Investment Committee had delegated authority to sign the Pension Fund Accounts. · In the ISO 260 there were two corrected mis-statements relating to a reclassification of reinvested income and level 3 financial disclosures. Adjustments had been made to the accounts following the advice received. · Once the accounts were signed by the Chair and the Head of Finance, the annual report and accounts would be considered by the Pensions and Investment Committee and published by 1st December, 2022. · ISA 260 and Letter of Representation. · The key message on page 247 was that the Auditor General intended to send out an unqualified opinion again for the year. · The Auditor General would sign off his opinion on 29th November which would allow the Council to publish the accounts by 1st December. · The Committee was advised that the audit engagement lead would be Derwyn Owen replacing Clare James. · The audit timetable this year had been compacted due to Covid, but with the assistance of Council staff was completed on time. · Letter of representation – there was nothing specific to be brought to the attention of the Committee. · There were no uncorrected statements in the accounts. · None of the amendments made affected the net assets of the pension fund. · Questions: Question Response There has been considerable disruption to the auditing of accounts due to revaluations. Have these issues been resolved as far as the pension fund accounts are concerned. Officer Response: The revaluation issue had been around fixed assets i.e. buildings. Although there had been fluctuations in the guilts market this has not had a significant impact on the pension fund. The Section 151 officer confirmed that the Council’s advisers had been consulted when the market disruption commenced as to whether the fluctuations had affected the Council’s investments. There would be an effect but due to the Council’s diversification in the fund this impact would be reduced. The Council also took out an equity protection strategy some years ago much of which remained in place which added a layer of protection to soften the impact. Some strategic steps had also been taken to manage the impact of market volatility. The triennial actuaries revaluation was undertaken this year, when will its results and impact be known. Officer Response: The impact will be confirmed in March 2023. The revaluation would also impact each employer in the fund differently. As far as the Council’s contribution rate was concerned it will probably provide a favourable opportunity. Outcomes: · That the Governance & Audit Committee approves the 2021-22 Pension Fund Accounts and Letter of Representation which can be formally signed by Chair of the Committee and the Section 151 Officer. · That the Governance and Audit Committee approves the 2021-22 Annual Governance Statement which can be formally signed by the Leader of the Council and the Chief Executive.
Documents Considered: · Audit Wales Report “Springing Forward Workforce Management” · Council response. Issues Discussed: · The Cabinet Member for a Connected Powys commented on the positive report which contained useful commentary. How the Council had responded to the report was also positive. · Audit Wales indicated that this work had been undertaken in all authorities in Wales. · It was found that there was a positive situation in the Council in respect of workforce management with clear plans for the workforce as well as clear plans to address workforce challenges. There were also effective service plans in place. · The new ways of working strategy had been a major change of emphasis for the Council and there was evidence that arrangements were in place to support this process. · There were also arrangements in place for monitoring workforce activity. · The improvements identified included benchmarking information as well as more frequent scrutiny of workforce management issues, although there was evidence that this was happening already. · The recommendation on benchmarking around workforce activities was common to most authorities and was recognised by the Council that this needed to be strengthened. · In relation to scrutiny, it would be a matter for scrutiny chairs to consider the inclusion of workforce management within work programmes. · The Head of Workforce and OD had already discussed this with the Chair of the Economy, Residents and Communities Scrutiny Committee and the Directors of Education and Children and Social Services and Housing about incorporating this within their areas. He was also leading an all Wales group to develop benchmarking. · The recommendation from this review would be included in the regulatory tracker. · Questions: Question Response Regarding the recommendation, have there been any linkages between Audit Wales’ work and SWAP’s work. SWAP had undertaken a review of the Highways, Transport and Recycling Service and performance management was identified as an issue. Officer Response: There were no links specifically in this report to the work undertaken by SWAP. This report was around workforce development rather than looking at a specific service. Would welcome more regular updates from officers about issues raised by Members with officers, as currently am unclear about the priority or timescales to deal with the issues raised. Officer Response: This is an issue for the Council rather than Audit Wales and is around regular communication with local Members. The state of the labour market in social care is mentioned in the report. This is consistent across all authorities. What can be done nationally to promote social care as a career. Does Audit Wales bring any consensus of views to the attention of Welsh Government. There is also a turnover of staff between authorities as well as a turnover at a senior level in the Council. Would this be accounted for in benchmarking. The Chair commented that the main organisation in Wales for promoting social care was Social Care Wales which promotes and regulates the social care workforce. Therefore, it would be this body who looked at issues with the social care labour market and discuss policies with Welsh Government. Officer Response: Audit Wales can review other springing forward workforce management reports in Wales and see what activities have been successful elsewhere in terms of social care recruitment. Integrated approaches with Health Boards is accepted as good practice. There are examples of joint working in Powys due to joint projects with the Health Board as well as the development of the Training Academies and joint recruitment processes. There is no national benchmarking for HR and workforce currently and this was something that the Head of Workforce and OD was developing with others. Is there a conduit from Audit Wales into Social Care Wales to provide feedback. Officer Response: Yes, Audit Wales can feed national themes from audits to a range of national organisations in Wales. Outcomes: · Noted.
Documents Considered: · SWAP Quarter 2 Report Issues Discussed: · SWAP had completed 27 pieces of audit work and were on track to have undertaken sufficient work to be able to provide an annual opinion at the end of the year. 77% of the work undertaken to date was positive. · The next report to the Committee will reference the seven priority 1 recommendations. · There are currently eighteen outstanding actions (18%) of which five are long standing (priority 1 and 2 actions). · The Assistant Director had met the Council’s Senior Leadership Team to try and move progress on review recommendations and there was support to make progress. · Generally implementation of SWAP recommendations is high. · There were three reports in the quarter with a limited assurance such as the National fraud initiative 2020 which was a data matching exercise. This was impacted by Covid and business grants administration which had an impact on the counter fraud team which were mitigating factors. There was a backlog of cases at the end of the previous exercise but these would be picked up in the NFI 2022 exercise. SWAP was carrying out some follow up work and ensuring that the Council was prepared for the next exercise in January. · There were also two Adult Social care reports which would be reported to the next meeting (continuing health care and deprivation of liberty safeguards). · The work of SWAP is generally aligned to strategic risks. · The overall rolling opinion at Quarter 2 is reasonable assurance. · Questions: Question Response Page 287 – risk of social care provider failure. Is the tendering process included in any work undertaken. Is the tendering process robust in terms of questions asked to mitigate this risk. Officer Response: The risk of provider failure is a key risk. Work has been undertaken on the commissioning process. As the risk of operator failure was increasing this would be included in the work plan again next year. Concerned about impact on the Council of staff working from home. How are systems coping where staff are not working in offices. Are instances of errors increasing? Officer Response: This has been considered by the Council from a wellbeing perspective. There was no category of home worker. The Council had established three categories of staff. The Council recognised the need for workers to be flexible which gave staff options as to whether they worked from home, in an office or a combination of both. Managers had individual conversations with employees and staff received a letter confirming which category they fell within. A staff survey was also undertaken with a significant proportion of staff finding that a flexible way of working improved productivity. Sickness overall had also reduced following a move to this means of working. The Council in addition, was looking at digital automation to support staff, which is where checks and controls are greater. A paper would be considered by the Democratic Services Committee regarding options for Members’ meetings including occasional face to face meetings or hybrid meetings. Concerns are about the impact on the Council of staff working at home and whether levels of error are increasing. Officer Response: There are positives and negatives for every approach. Generally working from home and working flexibly was working well for the finance team. New forms of communications between managers and staff had been developed using new technology during Covid which continued to be used. There was also some situations where face to face team events were more suitable. Are the tasks falling to SWAP more challenging because of the levels of remote working. Officer Response: There have been opportunities due to the mobilisation of the workforce and digital technology which have been positive and beneficial. There are some benefits of face to face discussions but overall the digital approach is more efficient and beneficial. The mobilisation of the workforce has positives and negatives. Welfare is important. Technically people have found better ways of communicating. Face to face supervision may not be taking place so performance relies on effective performance management. This may be piece of audit work for next year. Comments: · The Cabinet Member for Finance and Corporate Transformation commented that the Business Rate Relief Department had appeared in the top 4 KPI measures on a national basis in Wales and most of these staff were working from home, which showed that excellent performance could be achieved with staff working at home. Outcomes: · Noted.
Documents Considered: · Draft Terms of Reference for the following Working Groups: · Capital Working Group · Highways, Transport and Recycling Working Group · HoWPS Working Group · Internal Audit Working Group · Proposed membership of the Working Groups. Issues Discussed: · The scope and remit of the working groups had been discussed previously and the Chair had prepared the draft Terms of Reference. · With regard to HoWPS it has been agreed in consultation with the Chair of the Economy, Residents and Communities Scrutiny Committee that two separate working groups be established with the Governance and Audit Committee’s working group focussing on lessons learned in terms of setting up and operating any future commercial enterprises. · The proposed membership as set out in the attachment was as identified previously. · There was a need for an additional member representative on the Capital Working Group. · It was suggested that how working groups operated could be flexible depending on their forward work programmes. · It would be necessary for working groups to report back to the Committee. · Questions: Question Response How are the groups going to operate The working groups should operate flexibly to suit the work to be undertaken. Thanks to Chair for setting up the working groups. Can each team have a nominated secretariat to link with the remainder of organisation. Will there be a senior officer to work with groups and liaise with officers across the Council. Officer response: There is a commitment from officers that necessary officers will be available to support the groups. Outcomes: · Schedule of initial working group meetings to be prepared. · Each working group to determine its own work programme at the first meeting. · Add details of key contacts to the Terms of Reference.
Documents Considered: · Draft Work Programme Issues Discussed: · Identity of the risks subject to a deep dive to be included in the work programme. · Deep dives 1 and 2 – officers to be contacted about dates as soon as possible. · The Assistant Director (SWAP) suggested that the Committee might wish to receive an assurance about the tracking of other bodies and regulators which report to the Council. · It was suggested that the regulatory tracker be added to the work programme on a quarterly basis. Outcomes: · Identity of the risks subject to a deep dive to be included in the work programme. · Deep dives 1 and 2 – officers to be contacted about dates as soon as possible. · The regulatory tracker be added to the work programme on a quarterly basis.
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