Agenda item

To report progress against the Internal Audit Plan 2018-19 for the period 01 April 2018 including planned work until 30 September 2018 and the resulting level of assurance.      

Members considered the Internal Audit Plan 2018-19 Progress Report Q2 presented by Kathy Woodward.

Kathy Woodward explained that the overdue recommendations shown in Appendix B on page 58 of the Agenda Pack may look high however the figures include audits carried out on behalf of Anglia Revenues Partnership (ARP) as a collective audit of seven local authorities. One of the high outstanding recommendations relate to the ARP audits and fifteen of the medium recommendations too. In relation to Fenland District Council, there was one high recommendation and nine medium recommendations outstanding however as of today, there are now only two overdue medium recommendations. She confirmed that these would be reflected in the next progress report.

Members asked questions, made comments and received responses as follows;

1.    Councillor Booth asked for further information on the ‘Street Scene – Enforcement’ audit and the ‘Corporate Assurance – Transparency’ audit referenced in Appendix A on page 55 of the Agenda Pack. Kathy Woodward confirmed that the medium enforcement recommendation relates to the monitoring and flow of information the Council has with their Contractor. Work is ongoing in ensuring procedures are in place for this. In regards to the recommendation on transparency, this relates to responsibility and ownership of keeping information on the website up to date.

2.    Councillor Booth asked if the outdated information found on the website was information that the Council has a statutory duty to publish. Kathy Woodward confirmed that it related to statistics the Council must publish and these have now been reviewed and updated.

3.    Councillor Booth asked if Kathy Woodward was confident that a governance process was in place to ensure the website is updated regularly and to avoid this issue happening again. Kathy Woodward said that one of the recommendations made was to ensure ownership is taken of this task and confirmed that this is now in place.

4.    In relation to the Conduct Hearing on 31 October 2018, Councillor Booth asked for confirmation that the internal audit team had no concerns or recommendations in relation to Members Expenses and asked how members can be assured that this issue will not happen again. Kathy Woodward said that in light of the Conduct Hearing and the press surrounding this, she had extended the sampling size when she audited this area and confirmed that sufficient processes are in place to prevent this issue reoccurring in the future. She added that the test samples had satisfied her criteria and is confident that the procedures in place are being strictly adhered to by officers processing claims.

5.    Councillor Booth asked if Kathy Woodward believed that the complaint dealt with at the Conduct Hearing on 31 October 2018 was an isolated incident. Kathy Woodward confirmed that she did.

6.    Anna Goodall explained that it is each member’s responsibility to ensure the accuracy of the claims submitted to Member Services for processing however, in light of recent events the process has had to change and a more proactive stance has been taken in challenging and advising members upfront with any questions officers may have about their claims. In addition, she explained that the Council is exploring software systems that would allow members to submit their expenses electronically with mileage pre-set for certain journeys to avoid discrepancies in the future.

7.    Councillor Clark said it was important to show the public that the process has been improved since the Conduct Hearing complaint and asked members to consider how this could be done.

8.    Councillor Butcher highlighted that other local authorities have introduced systems to submit electronic mileage claims and have experienced issues. He said care must be taken to ensure this will not happen, if the Council do decide to consider this.

9.    Councillor Butcher asked if officers had taken a less proactive approach to processing member’s claims over recent years. Anna Goodall said the current member’s claim form contains very clear wording that states that members are responsible for ensuring the accuracy of their claims. As a result of recent events, a more proactive stance has been taken by officers with additional procedures and checks being implemented and a more robust approach being taken. She added that the procedure of claiming would form part of the future induction programme for newly elected members next year.

10.Councillor Booth asked if historical members’ claims had been audited. Councillor Clark highlighted past expenses and claims are irrelevant as members must demonstrate how the Council will deal with this in the future and prevent it from happening again.

11.Councillor Booth suggested a press release assuring the public that additional procedures have been implemented since the recent Conduct Hearing. Kathy Woodward said that the report being considered today highlights that there have been changes in procedures and states that there are no further concerns from an internal audit perspective. She added that this discussion will be documented in the minutes of the meeting too.

12.Councillor Clark said the Council must highlight to the public that they have learnt from this complaint and improvements have been made to prevent it happening again. Councillor Mrs Newell reiterated that the minutes will reflect the discussion members have had today which will provide assurance to the public.

13.Councillor Clark asked if this can be reflected in Council policy in any other way and asked whether the Corporate Governance Committee could recommend an action to another Committee. Councillor Booth reminded members that the Member Allowances Review takes place periodically and could not see the benefit in reviewing this before the one scheduled to take place next year.

14.Anna Goodall explained that the terms of reference for the Member Allowances Review will be bought to Annual Council and officers can capture the Corporate Governance’s Committee recommendation that any lessons learnt from the recent Conduct Hearing is addressed proactively through the review process. 

15.Councillor Booth agreed with this and said as the review will take place next year; it should be included in next year’s Internal Audit Plan too.

16.Kamal Mehta asked Anna Goodall if she could circulate instructions to members clarifying the claims process. Izzi Hurst confirmed that the Conduct Hearing Panel had recommended that this would form part of the member’s induction process and guidance documents will accompany this.

17.Councillor Booth said there appeared to be ambiguity surrounding allowable claims.

18.Councillor Clark confirmed that he was happy for officers to include the Corporate Governance Committee’s comments in the terms of reference that will inform the scope of the Member Allowances review at Annual Council in May 2019.

19.Councillor Booth asked for a timescale on the potential electronic claims submission system. Anna Goodall confirmed that officers were researching this currently.

20.Councillor Sutton agreed and said he had wanted an electronic system for a number of years as there will be no discrepancies in the pre-set miles for particular journeys and will be easier for both members and officers to confirm members’ attendance at meetings. He said that consideration will need to be given to recording member’s attendance to outside body meetings.  

21.Councillor Clark asked which officer was responsible for deciding whether a new claims system would be introduced. Anna Goodall explained that previously, the internal audit team had raised concerns about electronic mileage claims as they remove the need for a ‘wet signature’ on a member’s claim form which is currently used to link a member to a particular claim. However, the Council now has a new Committee Management software system that has the ability to process claims electronically and many other local authorities are successfully processing their member’s claims this way.

22.Councillor Clark asked who the Committee can make a recommendation to in order to ensure that the option of electronic claims is pursued further. Anna Goodall confirmed it would be herself and assured members that research was already taking place. She added that Councillor Buckton was the Portfolio Holder for ICT too.

23.Councillor Sutton agreed and said he believes that the removal of ‘wet signatures’ on claims forms would make the process smoother for members. Councillor Clark said officers should consider other local authorities approach to electronic claims systems in order to ensure the process is as successful as possible.

24.Councillor Butcher said members must consider the cost implications of a new system. He explained that other local authorities had experienced issues when members had attempted to claim for journeys between Council meetings, as this appeared outside of the set system parameters. He asked that officers consider this during their investigations.

25.Councillor Booth said he was surprised to see such a high amount of outstanding recommendations on page 58 of the Agenda Pack. He said the figure is much higher than previous progress reports and asked if a note could be sent from the Corporate Governance Committee to the Chief Executive raising their concerns about this. Councillor Clark said that Kathy Woodward had provided members with a suitable explanation for the outstanding recommendations.

26.Kathy Woodward explained that a number of the recommendations outstanding were under the service area responsible for the new leisure contract. Due to the vast amount of time and work spent on the leisure contract, this was a justifiable reason as to why some of the audit work was overdue in this service area. She confirmed that as soon as the work had been completed on the leisure contract, the officer had completed the work required by the internal audit team.

27.Kamal Mehta reassured members that as Corporate Director, he is closely monitoring the outstanding recommendations and is having regular meetings with Kathy Woodward to ensure these are being dealt with as a priority. He confirmed that the issue has been discussed at Management Team meetings and the Corporate Management Team has arranged 1-1’s with Service Managers to discuss this work.

28.Councillor Clark said the Committee have noted the number of outstanding recommendations and accepted the reasons provided for these, however would be disappointed to see as many outstanding recommendations in future reports. He asked Kamal Mehta to ensure that the new Section 151 officer is made aware of this when he begins his role next year. Kamal Mehta confirmed this.

29.Councillor Booth said annual objectives need to be given to officers to ensure ownership is taken of audit work in the future.

30.Councillor Booth highlighted that there could potentially be issues on the quality of work submitted after the deadline as officers may have rushed to complete these tasks. He asked for confirmation that the internal audit team monitor this. Kathy Woodward confirmed that the team check any overdue work submitted to ensure it is completed to a satisfactory standard.

The Corporate Governance Committee considered and noted the Internal Audit Plan 2018-19 Progress Report Q2.

The Corporate Governance agreed that a letter would be sent to Councillor Buckton (Portfolio Holder for ICT), Councillor Mrs Hay (Portfolio Holder for Finance) and Anna Goodall (Head of Governance and Customer Services) recommending that the Council pursue the options available to them in relation to an electronic claims system for member’s expenses.