Issue - meetings

Following a question raised at Council on 7 November 2023, the Leader of the Council has asked the Audit and Governance Committee to consider a report on lessons learnt from a governance perspective following the closure of the Council’s Urban Regeneration Company – BCP FuturePlaces Limited.

This report sets out the action taken to ensure appropriate and effective governance of Council owned companies including the independent governance review undertaken by DLUHC, a self-assessment review of Council-owned companies undertaken by the Council’s internal audit team, and the governance review undertaken by the Interim Chair of BCP FuturePlaces Ltd which considered lessons learnt over the first year of operation.

Following the work undertaken above and the subsequent closure of BCP FuturePlaces Ltd, a review of shareholder governance arrangements for all Council-owned companies was undertaken by the Interim Corporate Director for Resources in November 2023.

The review recommends changes designed to provide clearer understanding of the respective roles, decision-making arrangements, and improved accountability along with next steps for implementation should these recommendations be approved.

The Interim Corporate Director for Resources presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'B' to these Minutes in the Minute Book.

The Interim Corporate Director explained the objectives of the review of shareholder governance arrangements for all Council-owned companies which he had undertaken in November 2023. He referred to the importance of having the right shareholder model and his knowledge of the difficulties which some councils had experienced in this area. The proposals arising from the review aimed to provide clearer understanding of the respective roles, decision-making arrangements, and improved accountability along with next steps for implementation. It was noted that a review of each council company would be completed by the end of March 2024 with results reported to Cabinet in July 2024.

The Portfolio Holder for Transformation and Resources advised the Committee of the updated recommendations in relation to this report which were agreed by Cabinet on 10 January 2023, following input from the Overview and Scrutiny Board. A copy of these recommendations was circulated to the Committee for reference.

The Committee’s main focus of debate was around the need for regular monitoring and improved accountability and to avoid the need for any further ‘lessons learned’. The roles of Cabinet and Scrutiny in this process were discussed. Members agreed that the Audit and Governance Committee also had a role, in seeking assurance that governance arrangements were working effectively, and suggested that the Committee receive an annual monitoring report.

The Leader of the Council and the Portfolio Holder for Finance commented on the purpose of the review, in protecting the Council and ensuring governance arrangements were set up properly going forward. An annual review by the Committee would be welcomed and it was hoped that members were assured by the level of commitment and speed at which action had been taken.  The Interim Corporate Director confirmed that external expertise should not be required if the detailed methodology was followed. He clarified that the second phase of the review would include all arms-length bodies where the Council had influence. He also agreed to review the wording around the monitoring of conflicts of interest to ensure this was undertaken robustly.

RESOLVED that

a)    the following updated recommendations agreed by Cabinet on 10 January 2024 be noted:

That Cabinet:

1)    Approves the shareholder governance model set out at Appendix 1 for adoption by the Council in relation to all Council companies with immediate effect, subject to the amendment of the third red box on the right, replacing the words “Company has no role at scrutiny –“ with “Company may be requested to provide evidence to support scrutiny as required .”

2)    Notes that the future arrangements for Council companies will be based on the Local Partnerships best practice model, Local Authority Company Review Guidance.

3)    Notes that a review of all Council companies will be undertaken based on the work started by internal audit and actions plans completed  ...  view the full minutes text for item 55