Issue - meetings

RECOMMENDED that that the Financial Regulations as shown in Appendix A (with the updated amendment to Paragraph 16 in Part G) be approved for adoption, with the operational ‘go live’ date being 24 April 2024.

Paragraph 16 in Part G to be amended to read “All procurement processes of any value covered by The Health Care Services (Provider Selection Regime) Regulations 2023 must be agreed with and run by the SPT.”.

The Chairman of the Audit and Governance Committee, Councillor Marcus Andrews, presented the report on the financial regulations and outlined the recommendations as set out on the agenda.

RESOLVED that that the Financial Regulations as shown in Appendix A (with the updated amendment to Paragraph 16 in Part G) be approved for adoption, with the operational ‘go live’ date being 24 April 2024.

Voting: Unanimous

Evolutionary changes to the Council’s Financial Regulations are summarised in this report and shown in red text throughout the document at Appendix A and include: 

Key changes exist in Part G and include:

Change 1 - Threshold adjustment 

Base change throughout from the £25,000 excluding VAT threshold to £30,000 inclusive of VAT to reflect the changes required by the Public Contracts Regulations which also includes the requirement to calculate the estimated value of the contract to be inclusive of VAT. 

Change 2 - Procurement & Contracts Board 

A new entry in regulation 3 – Standards, has been added to reflect the formation of a new Procurement & Contracts Board that will have oversight over all planned spend decisions across the entire Council and will have the authority to require any Officer to attend a meeting and provide information and/or explanation as required by The Board. 

Change 3 - Removal of waivers (of Financial Regulations) Reference to waivers throughout have been removed and replaced with the requirement for those decisions to be signed off as part of the existing Procurement Decision Records (PDRs) approval process in regulation 5 and soon to be required by legislation changes. This change has clarified any ambiguity and will remove duplication of processes. The existing reporting requirements to the Audit & Governance Committee will remain – the annual report that was Waivers and Breaches of Financial Regulations will now be PDR’s and Breaches of Financial Regulations.  

Change 4 - Competition Requirements 

Reformatted and update to regulation 22 - Competition Requirements, which combines several previous regulations into one consistent regulation and clarifies the requirement at each threshold: 

·    Under £5,000 

·    £5,000 to £30,000 

·    Over £30,000 

Change 5 – Other minor editing and re-ordering

Other minor changes throughout have been added for clarification and to address any previous ambiguities.  Some reordering and aggregation of previous regulations have also taken place which makes direct comparison to previous versions more challenging. Such reordering and aggregation are not shown in red text because the regulation(s) has not been changed.

Legislative changes resulting from the Procurement Act 2023 are explained and the likely resulting impact on Financial Regulations will be that there may be some in-year changes required to ensure alignment. 

The Head of Audit and Management Assurance presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'C' to these Minutes in the Minute Book.

The report provided a summary of evolutionary changes to the Council’s Financial Regulations as shown in red text throughout the document circulated at Appendix A. Members were advised that the key changes were contained in Part G and related to the following areas: threshold adjustment in relation to VAT, formation of a new procurement and contracts board, the removal of waivers (of financial regulations), competition requirements and other minor editing/reordering amendments. The Committee was advised of an amendment to the wording of Paragraph 16 in Part G of the Financial Regulations to read as follows in the version to be submitted to Council for approval:

“All procurement processes of any value covered by The Health Care Services (Provider Selection Regime) Regulations 2023 must be agreed with and run by the SPT.”

The report also set out legislative changes resulting from the Procurement Act 2023, the likely resulting impact on Financial Regulations being the need for some potential in-year changes to ensure alignment. It was proposed to deal with this by delegation to the Chief Financial Officer and Monitoring Officer. Members were assured that any necessary changes would be reported to the first available Committee meeting.

The Head of Audit and Management Assurance responded to questions and comments on the report. He was asked what the Council was doing to encourage and enable providers with regards to social value considerations in light of updated legislation around public procurement. He explained that while further details from Government were awaited, the intention was to create a simpler system, remove barriers and extend opportunities for all potential providers in the procurement process, including small businesses and social enterprises. It was noted that social value criteria were already included in Part G (Paragraph 10) of the Financial Regulations. The Head of Audit and Management Assurance agreed to arrange for a briefing note on this issue to be circulated following consultation with the Strategic Procurement Team.

Members asked about the new requirement to sign off what had previously been known as ‘waivers’, as part of the Procurement Decision Records (PDRs) process. It was explained that although there were always circumstances where ‘waivers’ were required, the terminology was unhelpful and had been removed. The requirement to publish as a PDR was seen as more accountable and transparent and it was noted that the Committee would still receive an annual report on relevant decisions. It was confirmed that Service Directors were ultimately responsible for their commissioning officers being fully aware of and compliant with the Financial Regulations. The Chief Financial Officer agreed to raise the issue of staff training with the new Procurement and Contracts Board.

Members also asked about the changes to competition requirements. The Head of Audit and Management Assurance referred to the details set out in Paragraph 22 of  ...  view the full minutes text for item 68