Agenda and minutes

To approve the minutes of the previous meeting and to note the outstanding actions.

The minutes of the previous meeting held on 12 December 2018 were agreed as a correct record and signed by the Chair.

Apologies for absence were received from Councillors Rebecca Harvey and Alex Karmel.

If a Councillor has a disclosable pecuniary interest in a particular item, whether or not it is entered in the Authority’s register of interests, or any other significant interest which they consider should be declared in the public interest, they should declare the existence and, unless it is a sensitive interest as defined in the Member Code of Conduct, the nature of the interest at the commencement of the consideration of that item or as soon as it becomes apparent.

At meetings where members of the public are allowed to be in attendance and speak, any Councillor with a disclosable pecuniary interest or other significant interest may also make representations, give evidence or answer questions about the matter.  The Councillor must then withdraw immediately from the meeting before the matter is discussed and any vote taken.

Where Members of the public are not allowed to be in attendance and speak, then the Councillor with a disclosable pecuniary interest should withdraw from the meeting whilst the matter is under consideration. Councillors who have declared other significant interests should also withdraw from the meeting if they consider their continued participation in the matter would not be reasonable in the circumstances and may give rise to a perception of a conflict of interest.

Councillors are not obliged to withdraw from the meeting where a dispensation to that effect has been obtained from the Audit, Pensions and Standards Committee.

There were no declarations of interest.

Hitesh Jolapara (Strategic Director of Finance and Governance) introduced Andrew Smith and Sam Harding from Grant Thornton, the Council's new external auditors. Andrew Smith presented Grant Thornton's External Audit Plan which provided an overview of the planned scope and timing of the statutory audits of the Council accounts and the Council's pension fund. He noted that the key risks identified for the Council were:

·       Management override of controls

·       Valuation of property

·       Plant and equipment

·       Valuation of pension fund net liability

·       Implementation of the new general ledger resulting in material misstatements across the accounts

The pension fund's key risks were identified as:

·       Management override of controls

·       The valuation of Level 3 (hard to value) investments

·       Implementation of the new general ledger resulting in material misstatements across the accounts

Andrew Smith then stated the material thresholds for the Council would be £30m or 1.8 percent of gross expenditure and the threshold for the pension fund would be £80m or 1.8 percent of the total fund value. If there was a material error over and above those thresholds Grant Thornton would qualify their opinion. Errors identified below that level would be report to management for a response.

The Chair noted that the Committee had spent a lot of time considering items related to Agresso and the move to the new IBC system. He asked what additional work was being done in this area and if it would attract additional fees. Sam Harding responded that the auditor had already looked at the closing and opening balances on the transfer from Agresso to IBC SAP and they found no issues. They were also working with IT and insurance specialists to ensure the system and data quality was up to standard. Hitesh Jolapara informed members that auditors were involved in all stages of the transfer to provide reassurance.

The Chair asked if the audit of the pension fund would be looking into some reported issues with payments to pensioners. Andrew Smith said their focus would be on the accounts and higher-level controls. The issue raised was more about the day-to-day controls and the audit wouldn't go into that level of detail. It would however be picked up in any internal audit work in that area.

Members asked for an update on the interim audit. Sam Harding said the interim audit had started in December and auditors had completed work looking at the Council's significant business processes. She noted they hadn't found any issues at this time.

RESOLVED

The Committee noted Grant Thornton's external audit plan and audit fees letter.

Rhian Davies (Assistant Director of Legal and Democratic Services - and Monitoring Officer) presented the report requesting that the Council undertake a recruitment exercise to appoint an additional Independent Person. She noted that the Committee on Standards in Public Life's report on local government ethical standards, published on 21 January 2019, recommended at least two Independent Persons and she recommended the Council followed this best practice. She also noted the current Independent Person had been in place since 2012 and the report recommended a maximum of two terms of two years - so pending a successful recruitment the Council would take this opportunity to follow best practice.

She advised that it would be at least two years before legislation catches up to the report but in the meantime the Council should move towards best practice where possible. She would bring back options to a future meeting.

Rhian Davies highlighted the following key recommendations from the report:

·       A return to Standards Committees

·       Councillors can be suspended for 6 months

·       If a Councillor is suspended they would have the right to appeal to an ombudsman

·       Councils should have a model code of conduct

·       On declarations of interest - pecuniary and non-pecuniary interests would be changed back to the previous system of personal and prejudicial interests

The Chair asked if the new Standards Committee would be a standalone Committee. Rhian Davies said it would be - a separate committee would allow members to consider standards issues in more detail.

Councillor Jonathan Caleb-Landy asked how consideration of standards in H&F compared with other authorities. Rhian Davies said practice varied considerably between different local authorities. H&F was already meeting many of the best practices outlined in the report though.

Rhian Davies noted that the report also covered member complaints and that she would be informing the committee of such complaints once a year. In each of the cases in the report she contacted the Independent Person and took their view on whether to progress. It was determined that none of the three complaints merited a full investigation.

RESOLVED

1.    The Committee noted the outcome of the complaints received.

2.    The Committee approved the recruitment of an additional Independent Person.

David Hughes (Director for Audit, Fraud, Risk and Insurance) and Mike Sloniowski (Risk Manager) presented the report that provided members of the Committee with an update on risk management within the Council - and presented the Corporate Risk Register for consideration.

Mike Sloniowski noted the following key risks:

·       Risk 3: Commercial & Procurement - Work was concluding on a review and update to the Council’s Corporate Procurement Strategy, the Forward Plan of Procurement and cross-service contracts and commercial training. Improvements had been embedded in departments to ensure they were more effective and efficient in this area.

·       Risk 27: Digital Accessibility - The EU Web Accessibility Directive meant there would have to be a radical overhaul of the structure and content of public bodies websites and mobile apps to transform the way 13 million disabled people in Britain access the Internet.

·       Risk 6: Information Management, legislation and compliance - A joint programme being trialled in Children’s Services to improve information management. The disentanglement of shared services exposed issues with the management reporting system and the Business Intelligence Unit were looking at how to resolve this. Steve Miley noted that since coming out of shared services Children's Service hadn't received a single monthly management information report.

Mike Sloniowski noted that officers were also considering how the Council was prepared for a range of Brexit scenarios. They had spent a lot of time understanding the supply chain risk, staffing risks, impact on residents etc. In recent weeks there had been daily meetings with the business continuity team to keep updated on these issues. There was also a service group chaired by the Chief Executive and there were additional assurances through the London Resilience Forum that the Council was closely involved with.

Councillor Jonathan Caleb-Landy asked if the digital accessibility work meant the Council would be re-investing in the website or updating what was already in place. Mike Sloniowski said the work was more about future-proofing the design of web content - embedding accessibility by design.

Councillor Caleb-Landy noted that some residents struggled to find information on the website. He suggested involving community groups and groups like the Disabled People's Commission in the development of the new content. Kim smith informed the Committee that the Council had just appointed a senior co-production post, one of the key recommendations from the Disabled People's Commission, and they would be starting work at the end of the month. She said she would pass this work over to them to take it forward.

The Chair asked for officers to update the Committee on risk 22 - Children's Services placements - and the risks associated with knife crime, particularly given the recent fatal stabbing of a young person in the borough. Steve Miley said that, as with other London Boroughs, H&F was seeing a rise in demand from adolescents at risk due to knife crime, child sexual exploitation and children being used for drug trafficking (County lines). Last Thursday a 17-year-old was stabbed and died and this weekend a  ...  view the full minutes text for item 6.

David Hughes (Director for Audit, Fraud, Risk and Insurance) presented the report that summarised internal audit activity undertaken during the period 1 November 2018 to 1 February 2019. He noted that there had been seven further audits since the last meeting with 21 recommendations followed-up on and implemented. There had also been two full follow-up reviews (the limited assurance reports on the agenda) and of them, all high and medium recommendations had been implemented. David Hughes noted that the improved assurances provided in the report reflected the positive impact of the increased focus on assurance and risk management, led by the Chief Executive.

Sarah Bright (Assistant Director of Public Services Reform) and Rhian Davies (Assistant Director of Legal and Democratic Services) presented the limited assurance report.

David Hughes (Director for Audit, Fraud, Risk and Insurance) informed the Committee that LBHF Joint Ventures Ltd was an ethical debt joint venture set up in partnership with the company Intrum. The venture was slow to start, and governance was not as developed as it should have been in the early stages, but officers had since been working with Legal Services to develop more robust governance for this and any other joint ventures.

Sarah Bright added that the Public Services Reform department was involved in the early stages and have taken the project forward. They welcomed the recommendations from audit, though when the department picked the project up officers were aware of performance issues and rather than wait for the recommendations they had been actively working to address the issues identified in the report. Now the joint venture was in a much more positive situation. Two board meetings had been agreed with Intrum and new Directors had been appointed. There was also positive interest in the joint venture's products - three Council's had confirmed signed access agreements for pilots and three more were in the pipeline.

The Chair asked if all the products were related to ethical debt. Sarah Bright said there was a range of products, but they were all based on the same principles of ethical debt recovery.

David Hughes noted that this had been actively tracked by the senior leadership team and they were confident that it was moving in the right direction. Positive work had been completed on future governance structures to ensure the Council was properly discharging its shareholder duties.

Councillor Asif Siddique asked if officers could give an estimate of the near-term investment in the venture. Sarah Bright said officers have been working on investment costs, but they needed to complete pilot the work to fully understand the implications. Ultimately those decisions would be made by the Commercial Revenue Board.

Karen Sullivan (Assistant Director of Residents' Services), Mark Grimley (Director for Corporate Services), and Jane Sheehan (Resident Experience Manager) presented the report.

David Hughes noted that there had been a positive response to the audit and a clear action plan had been put in place. It had also been actively tracked and managed by the senior leadership team.

Karen Sullivan informed the Committee that in the 6 months since the audit all of the medium and high recommendations had been implemented. There was new management delivering the service now and performance had improved substantially. The Council's senior leadership team had also commissioned a wider piece of work looking at the overall operating model. There were pockets of best practice with regards to complaints in Social Care and Children's Services. The service was creating a 'residents commitment' that would be launching soon.

The Chair noted that a large proportion of enquiries from Councillors and MPs were related to housing and, given that the Council was changing the repairs service soon, how were these complaints going to be managed going forward? He had concerns about the complications created by the move - i.e. cases could be lost in the transition. Karen Sullivan said the complaints team had been deeply involved in this project - they had fed into training for H&F Maintenance staff, so they were clear on the processes and there was a dedicated team for complaints and service improvement.

The Chair asked if officers had done an analysis of which departments had the most overdue complaints. Karen Sullivan noted the last graph in the report showed some of this information - there had been a large increase from Housing which coincided with Mitie (the current housing repairs provider) informing the Council of a resource gap. Adult Social Care and Children's Services also had complaints that could be very complex and take time to respond to and resolve. There was a backlog of subject access requests and this included a number of Children's Services requests. Due to the nature of Children's Services work these requests could cover a child's lifetime and involve a wide range of different contacts and services.

Councillor Jonathan Caleb-Landy noted that he had seen an improvement in response times in recent months and wanted to thank officers for that. He then went on to say that every resident waiting for a response was extremely important. He asked what the target was for responses and what good looked like in this area.

Karen Sullivan said the target for a member enquiry was a response within 3 working days. Previously this had been achieved 61 percent of the time but in recent months it had improved to 73 percent. The aim was to get this to 95 percent, but it would take time to achieve that.

Councillor Asif Siddique asked how enquiries were prioritised if they were very urgent. He also asked that officers ensured that responses had the same subject line as the request, so members could  ...  view the full minutes text for item 9.

David Hughes (Director for Audit, Fraud, Risk and Insurance) presented the Internal Audit Plan for 2019-20. The plan had been reviewed to ensure that the Council's audit work addressed key risks during a period of change and general financial constraints. The plan would include sufficient audit coverage to enable officers to provide an overall opinion on the Council’s control framework and is sufficiently flexible to allow for additional reviews to be added in areas where support and/or advice might be required.

Members said they supported the Internal Audit Plan for 2019-20.

RESOLVED

That the Committee reviewed and supported the proposed internal audit plan for 2019/20 as set out in Appendix 1 of the report.