Agenda and minutes

To receive any apologies for absence from Councillors.

There were no apologies for absence.

To receive information on any changes in the membership of the Committee.

Note – When a member of a Committee is unable to attend a meeting of a Committee or Sub-Committee, the relevant Political Group Leader (or their nominated representative) may, by notice to the Monitoring Officer (or their nominated representative) prior to the meeting, appoint a substitute member from within the same Political Group. The contact details on the front of this agenda should be used for notifications.

There were no substitute members appointed.

Councillors are asked to elect the Chairman of the Audit and Governance Committee for the 2020/21 Municipal Year.

RESOLVED

that Councillor Beesley be elected as Chairman of the Audit and Governance Committee for the 2020/21 Municipal year.

Voting by secret ballot.

Councillors are asked to elect the Vice-Chairman of the Audit and Governance Committee for the 2020/21 Municipal Year.

RESOLVED

that Councillor Williams be elected as Vice-Chairman of the Audit and Governance Committee for the 2020/21 Municipal year.

Voting by secret ballot.

Councillors are requested to declare any interests on items included in this agenda. Please refer to the workflow on the preceding page for guidance.

Declarations received will be reported at the meeting.

Councillor Cox declared his employment as an Auditor.

To confirm and sign as a correct record the minutes of the Meeting held on 12 March 2020.

The Minutes of the meeting on 12 March 2020 were confirmed as a correct record.

To receive any public questions, statements or petitions submitted in accordance with the Constitution. Further information on the requirements for submitting these is available to view at the following link:-

https://democracy.bcpcouncil.gov.uk/ieListMeetings.aspx?CommitteeID=151&Info=1&bcr=1 

The deadline for the submission of public questions is Thursday 23 July 2020.

The deadline for the submission of a statement is 12.00 noon, Wednesday 29 July 2020.

The deadline for the submission of a petition was Wednesday 15 July 2020.

There were no public issues.

This report seeks to explain the relationship between BCP Council and BH Live, who provide a range of leisure, conferencing and Cultural services. The report makes a number of recommendations for improving the contractual and governance arrangements.

The Corporate Director of Regeneration and Economy presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix ‘A’ to these Minutes in the Minute Book. A copy of BH Live Annual Report was also attached with the agenda.

For clarity the Chairman informed the Committee that he did not have a role in BH Live that required declaration and that this had been confirmed by the BCP Council Monitoring Officer.

The report, focussing on issues of governance within BH Live, set out the relationship between BCP Council and BH Live which provided a range of leisure, conferencing and cultural services. The specific roles for councillors as Trustees on the main Board and as members of BH Live Enterprises were set out and the potential for possible conflict explained although new arrangements for contract monitoring were reported to have been put in place since BCP Council was established.

The report described the mission and role of BH Live and explained how the relationship between it and the BCP Council, including issues around ownership of buildings and facilities, was managed. 

With the consent of the Chairman, Councillor Bartlett addressed the meeting raising a series of issues about governance of BH Live based upon his experience as a newly appointed member of BH Live Enterprises. He cited a number of areas in respect of which he considered further clarification was required and referred to the Business Planning and Financial Planning processes which were in place.

The Chief Executive confirmed that the Council had a specific responsibility to its members appointed to these roles and that guidance about performance in that capacity was required and was in the course of preparation and would be made available to councillors as soon as possible.

RESOLVED that

under Section 100(A)(4) of the Local Government Act 1972, the public be excluded from the meeting for the following items of business on the grounds that they involve the likely disclosure of exempt information as defined in Paragraph 3 of Part I of Schedule 12A of the Act and that the public interest in withholding the information outweighs such interest in disclosing the information.

Exempt Business – Confidential.

The Committee considered a range of issues relating to contractual arrangements in place between BCP Council and BH Live and to operational and commercial factors.

The Committee returned to public session and it was

RESOLVED that:-

(a)  the Council provides greater clarity over the role and expectations of councillors who are members of the BH Live Board and its subsidiaries;

(b)  a report on BH Live (alongside similar organisations such as SLM and Lighthouse) be brought to Overview and Scrutiny Board at least annually;

(c)  given the incomplete information at this stage it would be prudent to defer further discussion until all relevant information can be made available so that a detailed set of governance recommendations can be made.

Voting: Unanimous.

This report sets out the monitoring of the Council’s Treasury Management function for the period 1 April 2019 to 31 March 2020.

A surplus of £1.4 million was achieved through higher investment returns and lower borrowing costs.

The report also sets out the Quarter One performance for 2020/21 which forecasts a £112,000 underspend caused by higher cash balances than previously assumed reducing the need to borrow in the short term.

The Assistant Chief Financial Officer 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 report provided monitoring of the Council’s Treasury Management function for the period 1 April 2019 to 31 March 2020 within the context of the economic background and particularly the impact of COVID19 on the BCP Council Treasury Management Policy. Schedules of borrowing and investment were set out and it was reported that a surplus of £1.4 million was achieved through higher investment returns and lower borrowing costs.

The report also included the Quarter One performance for 2020/21 which forecast a £112,000 underspend caused by higher cash balances than previously assumed, reducing the need to borrow in the short term

It was explained that it was a requirement under the Chartered Institute of Public Finance and Accountancy (CIPFA) Treasury Management Code of Practice that regular monitoring of the Treasury Management function was reported to Members.

RESOLVED that:-

(a)  the reported activity for the Treasury Management function for 2019/20 be noted;

(b)  the reported activity for the Treasury Management function for April to June 2020 be noted.

Voting: Unanimous.

At the request of the Chair of the Audit and Governance Committee this report has been produced to reflect on the recommendation of the COVID-19 - 2020/21 Budget Monitoring report to Cabinet on the 24 June 2020.

The Assistant Chief Financial Officer 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.

At the request of the Chairman, the Committee received a report produced to reflect on the recommendation of the COVID19 2020/21 Budget Monitoring report to Cabinet on 24 June 2020 and the various roles as between Council, Cabinet, the Leader of Council and the Audit and Governance Committee were explained and set out.

It was explained that the approach taken to treatment of budget pressures in 2020/21 was based upon a flexible mitigation strategy recognising the uncertainties around the financial impact of the public health emergency, the levels of additional central government funding and decisions around the allocation of resources throughout the remainder of the financial year.

It was reported that key actions being taken within Directorates were being monitored. Alongside this, the view of the External Auditors was being sought on an ongoing basis and the Auditor had expressed satisfaction with the steps being taken. For comparison purposes, the approach being adopted by other Local Authorities in response to the current financial challenges were summarised.

The Chief Executive referred the Committee to a number of issues which were under review including the use of the financial delegations within the Constitution and the examination of how all councillors could be engaged more widely within the budget setting process. This was within the context of the close political balance which currently existed within the BCP Council and reflecting the unprecedented impact upon the budget process that had resulted from the pandemic. The Chief Executive undertook to report back to a future meeting of the Committee on the outcome of this review and to ensure that the views of the Committee were taken fully into account.

RESOLVED that:-

(a)  the report on the governance of budget monitoring in the light of the impact of the COVID 19 pandemic be noted;

(b)  a further report on budget governance be submitted by the Chief Executive to a future meeting of the Committee.

Voting: Unanimous.

This report updates councillors on the position of the council’s Corporate Risk Register. The main updates are as follows:

·        The significant changes to the risk landscape faced by the council as a result of the pandemic.

·        An introduction to the COVID-19 Corporate Risk Register created in April 2020.

·        Information on the planned consolidation of the two registers.

The Risk and Insurance Manager presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix ‘D’ to these Minutes in the Minute Book.

The Committee received an update on the BCP Council Corporate Risk Register including the way in which it reflected the significant risk landscape faced as a result of the COVID19 pandemic. Details of the generic risk register and the COVID19 specific risk register were presented and set out in detail. Members were reminded that the latter was developed with support of the Committee at a workshop session held in April 2020. It was reported that after further consideration the register would now be the subject of a fundamental review with the intention, through consolidation, to create a single set of risks. The outcome of the process would be presented to a future meeting of the Committee.

RESOLVED

that the update provided in relation to corporate risks be noted.

Voting: Unanimous.

The Audit and Governance Committee is responsible for maintaining an overview of the Council’s Constitution and governance arrangements.

The use of a Working Group for the recent review proved to be effective and the committee is therefore asked to consider the establishment of a permanent Working Group to undertake these responsibilities, recommending changes as appropriate.

The Head of Democratic Services presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix ‘E’ to these Minutes in the Minute Book.

It was explained that the Audit and Governance Committee was responsible for maintaining an overview of the Council’s Constitution and governance arrangements.

The use of a Working Group for the recent review had proved to be effective and the Committee was therefore asked to consider the establishment of a permanent Working Group to undertake these responsibilities, recommending changes as appropriate to the Audit and Governance Committee.

The Chairman of the Committee reported that, following conclusion of work by the previous Working Group, he had written to all members of Council inviting submission of suggestions for future review and that the responses received had been collated for attention by the re-formed Working Group. The importance of being able to call on councillors from outside membership of the Working Group to provide, where appropriate, specialist input was underlined.

RESOLVED that:-

(a)  a Constitution Review Working Group be established comprising five councillors drawn from the Audit and Governance Committee, made up of two councillors from the Conservative Group, one unaligned councillor and two from the Unity Alliance;

(b)  meetings of the Working Group be held at 6pm;

(c)  where appropriate, other relevant councillors and officers be invited to attend meetings of the Working Group on specialist areas in a non-voting capacity.

Voting: For – 5; Against - 4.

The Council has not made use of RIPA powers during the 2019/20 financial year.

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 ‘F’ to these Minutes in the Minute Book.

The report was presented to the Committee to ensure transparency in respect of the BCP Council’s use of its powers under the Regulation of Investigatory Powers Act (‘RIPA’) and members were reminded of the provisions and powers within the Act.

RESOLVED that

The fact that Council has not made use of powers under the Regulation of Investigatory Powers Act during the 2019/20 financial year be noted.

Voting: Unanimous.

This report sets out the breaches, waivers and exemptions of Financial Regulations which have occurred during the 2019/20 financial year.

The relatively low number of breaches and lower level of waivers compared to previous years (from legacy Councils) indicate that there was generally a good level of understanding of the Regulations.

The Chief Finance Officer, or formally delegated representative, agreed 66 waivers/exemptions totalling £13.8M.

Whilst full compliance can never be guaranteed and ‘under-reporting’ is an inherent possibility, arrangements were in place to detect instances of non-compliance. 

An effective and transparent breaches / waivers / exemptions governance process maximises the chances of the Council achieving value for money and complying with UK law (Public Contract Regulations 2015) when procuring goods, services or works.

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 ‘G’ to these Minutes in the Minute Book.

To comply with Financial Regulations requiring annual consideration by the Committee of breaches and waivers, the report set out the breaches, waivers and exemptions of Financial Regulations which had occurred during the 2019/20 financial year. A schedule of individual breaches and waivers was circulated with the agenda and assurances were provided that each breach was thoroughly investigated. It was also explained that, in the case of waivers, a significant number related to the period of transition from legacy councils to the new BCP Council.

It was reported that the relatively low number of breaches and lower level of waivers compared to previous years from within the legacy Councils indicated that there was generally a good level of understanding of the Regulations.

It was also noted that an effective and transparent governance process maximised the prospect of the Council achieving value for money and complying with UK law (Public Contract Regulations 2015) when procuring goods, services or works.

RESOLVED that

the breaches, waivers and exemptions of Financial Regulations that occurred during 2019/20 be noted.

Voting: Unanimous.

This report sets out the Internal Audit Charter and Audit Plan for 2020/21. Approval of these documents by the Audit and Governance Committee is a requirement of the Public Sector Internal Audit Standards (PSIAS).

The report also details progress made on delivery of the 2020/21 Audit Plan for the period April to June (inclusive) 2020.  The report highlights that:

·       One audit assignment has been completed (‘Reasonable’ audit opinion);

·       Eleven audit assignments are in progress;

·       Implementation of audit recommendations is satisfactory.

Significant un-planned time has been spent on COVID 19 NDR Grant verification and fraud prevention work during the first quarter. 

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 ‘H’ to these Minutes in the Minute Book.

The report set out the Internal Audit Charter and Audit Plan for 2020/21 and approval of the documents by the Audit and Governance Committee was a requirement of the Public Sector Internal Audit Standards (PSIAS).

The report also detailed progress made on delivery of the 2020/21 Audit Plan for the period April to June (inclusive) 2020. The report highlighted that one audit assignment had been completed (with a ‘Reasonable’ audit opinion); eleven audit assignments were in progress and that the implementation of audit recommendations was satisfactory.

Significant un-planned time spent on central government COVID19 NDR Grant verification and associated fraud prevention work was identified in the report and had an impact on delivery of the audit plan during the first quarter. The Committee recorded its thanks to the Head of Audit and Management Assurance and the Audit team for their flexibility and increased work as a result of undertaking this additional grant verification responsibility.

RESOLVED that:-

(a)  the Internal Audit Charter be approved and the Chairman be authorised to sign the document to record this approval (this to be implemented be a virtual sign off using email);

(b)  the Internal Audit Plan 2020/21 be approved;

(c)  the budget for the Internal Audit service which has been previously approved by Council be noted;

(d)  the progress made and issues arising on the delivery of the 2020/21 Internal Audit Plan be noted.

Voting: Unanimous.

The attached report sets out the work that the Council’s External Auditor, Grant Thornton, plan to undertake for the audit of the Council’s Statement of Accounts in respect of 2019/20.

The External Auditor plans to give an opinion on whether the accounts give a true and fair view and whether the Council has made proper arrangements for securing economy, efficiency and effectiveness in their use of resources.

The Committee received a report from External Auditors, Grant Thornton, a copy of which had been circulated to each Member and a copy of which appears as Appendix ‘I’ to these Minutes in the Minute Book.

The report set out the work that the External Auditor, Grant Thornton, planned to undertake for the audit of the Council’s Statement of Accounts in respect of 2019/20. The work would enable the External Auditor to give an opinion on whether the accounts gave a true and fair view and whether the Council had made proper arrangements for securing economy, efficiency and effectiveness in their use of resources. It was reported that the opinion would also include reflection on the BCP Council’s response to the COVI19 pandemic.

RESOLVED that

the Grant Thornton External Audit Plan 2019/20 be noted.

Voting: Unanimous.

Grant Thornton plan to commence work on the final draft financial statements during August and September and the outcome of the work will be reported in the Audit Findings Report.

Grant Thornton aim to give an opinion on the Statement of Accounts by the statutory deadline of November 30th, 2020 along with their Value for Money Conclusion.

Grant Thornton have provided a summary of emerging national issues and developments that may be relevant to the Council.

The Committee received a report from External Auditors, Grant Thornton, a copy of which had been circulated to each Member and a copy of which appears as Appendix ‘J’ to these Minutes in the Minute Book.

The report from Grant Thornton set out the External Auditor’s plan to commence work on the final draft financial statements during August and September and to report the outcome of their work in the Audit Findings Report. It was reported that the aim was to give an opinion on the Statement of Accounts by the statutory deadline of 30 November 2020 along with their Value for Money conclusion.

Grant Thornton also provided, for the information of the Committee, a summary of emerging national issues and developments that may be relevant to the Council.

RESOLVED that

the External Auditor’s progress to date in delivering their responsibilities and the sector update provided be noted.

Voting: Unanimous.

This report sets out the reports to be received by the Audit & Governance Committee for the 2020/21 municipal year.

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 ‘K’ to these Minutes in the Minute Book.

The report listed the reports to be received by the Audit & Governance Committee for the 2020/21 municipal year. There was discussion about emerging reports and changing deadlines and agreement to the fluidity that may be required in delivering the agenda for the September and October meetings. The schedule would therefore remain under discussion with the Chairman closely involved and Members of the Committee advised as soon as any changes were agreed.

In the meantime, the Chairman requested Members to submit, through him in the first instance, any subject suggestions for discussion at future non-core meetings of the Committee always bearing in mind the resource implications involved.

RESOLVED that

subject to discussions at the meeting, the forward plan set out at Appendix A to the submitted report, be approved.

Voting: Unanimous.