COUNTY BOROUGH OF BLAENAU GWENT

REPORT TO: / THE MAYOR AND MEMBERS OF THE COUNCIL
SUBJECT: / AUDIT COMMITTEE – 27TH JANUARY, 2015
REPORT OF: / TEAM LEADER – DEMOCRATIC SERVICES

PRESENT:COUNCILLOR J. MASON (CHAIR)

Councillors Mrs. K. Bender, B.Sc. (Hons)

K. Chaplin

G. Collier

M. Cross

M.B. Dally

N. Daniels

R. Jones

D. Owens

B. Pagett

Mrs. D. Rowberry

Mrs. L. Winnett (Vice-Chair)

Mr. Peter Williams – Lay Member

WITH:Head of Internal Audit

Service Manager for Development and Commissioning

Chief Accountant - Revenues

Internal Audit Manager

Solicitor

OD, Policy and Projects Officer

AND:Wales Audit Office (WAO)

Mr. Phil Pugh

DECISIONS UNDER DELEGATED POWERS

ITEM / SUBJECT / ACTION
----- / ILLNESS
It was reported that Councillor John Hopkins had recently undergone surgery. It was, therefore,
RESOLVED that a letter be forwarded to Councillor Hopkins on behalf of the Chair and Members of the Committee expressing best wishes for a speedy recovery. / Ceri Edwards- Brown
No. 1 / APOLOGIES
Apologies for absence werereceived from:-
Head of Financial Services and Mr. Derwyn Owen – Wales Audit Office.
No. 2 / DECLARATIONS OF INTEREST AND
DISPENSATIONS
There were no declarations of interests or dispensations reported.
No. 3 / AUDIT COMMITTEE
The Minutes of the Audit Committee held on 25th November, 2014 were submitted, whereupon:-
Systems Audit – Industrial Units
It was noted that the final paragraph should be amended to read “The Chair said it would also be appropriate if a copy of the review was presented to the Audit Committee for information”.
RESOLVED, subject to the foregoing, that the minutes be accepted as a true record of proceedings.
No. 4 / ACTION SHEET
The action sheet arising from the Audit Committee held on 25th November, 2014 was submitted, whereupon:-
The Council’s Engagement with Pricewaterhouse Coopers (PwC) – What were the financial implications in terms of this engagement process? - In reply to a question, regarding whether the £3.66m identified savings were achievable, the Head of Internal Audit undertook to pursue the matter and report back accordingly.
Another Member questioned whether the decision to engage PwC should have been made by Full Council due to the substantial cost implications. The Head of Internal Audit confirmed that the Council’s Standing Orders for Contracts had been complied with.
Councillor M. Cross joined the meeting at this juncture.
The Chair referred to the Council process whereby Members had the opportunity to submit questions in relation to various topics and suggestedthat the Member could use this process on this occasion in order to gain a detailed answer.
RESOLVED, subject to the foregoing, that the Action Sheet be acknowledged. / Louise Rosser
No. 5 / WAO – ANNUAL AUDIT LETTER
Consideration was given to correspondence received from the Wales Audit Office dated 30th November, 2014.
At the invitation of the Chair, Mr. Phil Pugh of the Wales Audit Office highlighted the following salient points:-
The correspondence summarised the key messages from the Wales Audit Office 2013/14 audit. This correspondence had been issued on 30th November, 2014 in line with statutory deadlines.
The Council had complied with its responsibilities relating to financial reporting and use of resources.
An unqualified Audit opinion on the accounting statements was issued on 8th October, 2014 confirming that they presented a true and fair view of the Council’s financial position and transactions. The key matters arising from the accounts audit were reported to the Audit Committee on 29th September, 2014 as part of the Audit of Financial Statements Report (ISA260 report).
The Council had responded positively to the statutory recommendations made in 2013 by the Appointed Auditor and Auditor General for Wales.
The Council’s progress had been monitored over the last 12 months and it had been concluded that during 2013/14 and to date in 2014/15, the Council with the support of the Welsh Government Advisors had responded positively to the recommendations. In doing so, the Council had taken appropriate action to improve its financial management arrangements. Although it was too early to confirm whether the actions taken to date would deliver the full quantum of the savings required, the progress made was encouraging. The first paragraph on Page 35 of the document outlined the new arrangements that the Council had introduced during this period.
The Council had appropriate arrangements in place to secure economy, efficiency and effectiveness in its use of resources.
The Council’s arrangements to secure economy, efficiency and effectiveness had been based on the audit work undertaken on the accounts as well as placing reliance on the work completed as part of the Improvement Assessment under the Local Government (Wales) Measure 2009.
Work to date on certification of grant claims and returns had not identified any significant issues that would impact on the 2014/15 accounts for key financial systems.
A more detailed report on grant certification work would be presented in 2015 once this year’s programme of certification work had been completed.
Financial Audit Fee 2013/14 – this was expected to be in line with the agreed fee of £191,489 as detailed in correspondence sent to the Chief Executive dated 1st May, 2014.
In reply to a request, it was confirmed that a copy of the correspondence forwarded to the Chief Executive in respect of the Financial Audit Fee 2013/14 would be forwarded to all Members of the Audit Committee.
RESOLVED accordingly.
Members were then given the opportunity to raise questions/comments in relation to the item.
The Council had responded positively with the support of the Welsh Government Advisors to the statutory recommendations made in 2013 –in reply to a comment made, Mr. Pugh advised that a report had been presented to the November meeting of the Audit Committee relating to Transforming Blaenau Gwent and the Phase 1 review of the arrangements that had been established in June 2014. This report indicated that these arrangements were sound and adequate and Phase 2 of this work was due to be undertaken in 2015.
It was noted that whilst the Phase 1 work specifically related to the established arrangements the Phase 2 work would examine in further detail the appropriateness of these arrangements and whether the anticipated outcomes were being delivered.
Mr. Pugh continued by stating that he believed that the Authority had benefitted from the Welsh Government support arrangements and this had been reflected in the report that had been presented to the November Meeting of the Audit Committee.
He concluded by pointing out, however, that there were still considerable challenges facing Blaenau Gwent (and every local authority) in terms of finance and austerity measures but Blaenau Gwent had certainly made a positive start over the last 12 months in order to try and address the previous shortfalls but this progress needed to be sustained.
The Chair said that the report was encouraging and the Council’s position was improving. The appropriate mechanisms werealready established i.e. Corporate Overview Scrutiny Committee, Executive and CMT to ensure the continued evaluation of this process.
FURTHER RESOLVED, subject to the foregoing, that the correspondence be noted. / Ceri
Edwards-
Brown
No. 6 / WHISTLEBLOWING POLICY
Members considered the report of the Head of Organisational Development.
At the invitation of the Chair, the OD, Policy & Projects Officer explained that the purpose of the report was to inform Members of the changes made to the Council’s Whistleblowing Policy following the Wales Audit Office review in March 2014. These recommendations were outlined in Appendix 2 attached to the report.
However, the Committee was advised that Paragraph 3.2 of the Detailed Report should be amended to read ‘A flowchart was also added to the policy document’.
Also, since the preparation of the report, the following information had been received:-
Identify methods of checking staff awareness – it was reported that 81% of officers had responded to the staff survey indicated that the Whistleblowing Policy was fairly or very effective.
Provide training on investigation skills –The Head of Legal and Corporate Compliance had indicated that officers would require training specifically in relation to Whistleblowing investigations and this training would be provided as part of a future plan.
Members were then given the opportunity to raise question/comments in relation to the document.
Reported cases – in reply to a question, it was confirmed that no issues had been raised since the introduction of the revised policy. It was also noted that statistics in relation to Whistleblowing cases were published in the Annual Governance Statement.
Staff awareness – a Member enquired whether all officers had been provided with a copy of the policy for their perusal. The OD, Policy & Projects Officer said that officers had not been provided with a physical copy of the revised policy, however, they had been made aware of the revised policy via the payslip notice which had been distributed in January 2015 and also the Chief Executive’s newsletter. A copy of the policy was also available on the Council’s Intranet Site.
In reply to a further question, the Head of Internal Audit confirmed that whilst the policy was aimed at officers, Members would also be able to use the policy as a reporting mechanism.
Upon a vote being taken it was
RESOLVED, subject to the foregoing, that the report be accepted and the changes made to the Council’s Whistleblowing Policy following the Wales Audit Office recommendations be noted.
No. 7 / PROGRESS UPDATE ON THE SYSTEM AUDIT ON RESIDENTIAL/NURSING HOME PLACEMENTS 2012 - 2013
The report of the Corporate Director of Social Services was submitted for consideration.
The Service Manager for Development and Commissioning spoke in detail to the report which provided Members with an explanation of the recommendations that had not beenactioned since the original audit on residential and nursing home placements in 2012 – 2013.
Members were then given the opportunity to raise questions/comments in relation to the report.
Recommendation 1 – Team Manager should ensure that the Business Management Division was informed promptly of any staff leavers or where access was no longer appropriate –a Member enquired as to the reason why the system had not been promptly updated and potential access removed for the two staff leavers. He also sought an assurancethat this would not occur in the future.
The Service Manager for Development and Commissioning explained that mechanisms to tighten up this control were being addressed with Service and Team Managers via PRS and supervision sessions. Whilst he was unable to offer an explanation for the time lapse in removing the staff leavers from the system, this matter was now being progressed via Departmental Management Team to address those issues.
Recommendation 5 – Team Managers should ensure that a current contract existed between the Authority and the Service User and they were returned, signed and dated –in reply to a question regarding this issue, the Service Manager for Development and Commissioning reiterated the Department could not ensure all contracts were signed as some did not have capacity to sign them, however, he advised that from a commissioning perspective, work was being undertaken with Social Work Teams (including Social Workers) to ensure that individual contracts were signed and returned, where possible. Elements of the contract monitoring process would also be strengthened.
It was noted that the Business Support Service had implemented a process for this but it was reliant on co-operation from the service user/family to respond to requests to sign the contract and delays and difficulties did occur if family members resided outside the County Borough.
A Member said that it would be useful to know the percentage number of contracts that were not signed due the family residing outside the County Borough.
A Member referred to Paragraphs 2.7 & 2.8 of the report and stated that whilst the majority of the contracts were signed at the six weekly review meeting with the service users and the provider, there were occasions when the provider would take the contract away to sign and return at a later date, but failed to return. The Member questioned why this was the case and why it was allowed to happen? She pointed out that as part of the Quality Assurance process of auditing case files, checks were made to ensure signed contracts had been returned, however, she expressed her concern that where these had not been provided the Social Worker had to undertake further additional work to secure the relevant signatures.
The Service Manager for Development and Commissioning advised that the training aspect would address this issue. Social Workers focused their attention on the care and delivery plan and well being of the service user and the appropriate training would ensure that there was an understanding of the importance of a signed contract. This aspect would be addressed as part of the commissioning arrangements and the intended outcome was to enhance and improve the process.
A Member pointed out that whilst the audit had only sampled from 10 placements, 4 of the placements had not received a signed contract. She expressed her concern thatthis was still a large proportion of a small sample that had been highlighted that did not have signed contracts.
The Service Manager stated that it was critical that signed contracts were in place and reassured Members that this matter would be addressed via awareness raising measures. A holistic approach would be taken and reiterated that this area would be progressed in terms of strengthening the commissioning process both this coming year and next year.
In reply to a question, it was reported that service users or family members were encouraged to sign the contract to ensure that they had an understanding of the capacity and level of care package that was to be provided. This aspect would also form part of the review arrangements.
Members were advised that on occasions service providers took away the contracts because those present at the meeting were not authorised signatories. It was noted, however, that there were overarching provider contracts which placed a duty of careon providers to deliver the service. The highlighted recommendation referred to individual contracts which provided details of service user care planning arrangements.
Recovery testing for the DRAIG system – a Member questioned why the ICT Division had not considered this a priority particularlywhen it had been identified as a high risk for the Social Services Department?
It was reported that ICT had beenmade aware that the audit had identified this area as a high riskfor the department, however, no other department had a Service Level Agreement in place with the ICT Division in terms of systems and processes and the ICT Division had indicated that they were satisfied with the current arrangements. It was noted that this matter would be progressed with Audit colleagues.
A Member requested that a follow up report be produced in respect of this area detailing the progress made.
RESOLVED accordingly.
Outstanding Recommendations –a Member referred to the outstanding actions and asked at what juncture the Audit Section would be satisfied that the actions had been completed and when would Members be informed that all outstanding actions had been completed.
The Head of Internal Audit advised that the work of the Section had concluded with the follow up audit and the Section did not have sufficient resources to conduct a further follow up audit to be undertaken.
The Chair said that if Members required a ‘follow up’ report he suggested that this issue be referred to the Social Services and Active Living Scrutiny Committee for consideration.
RESOLVED accordingly.
A Member expressed his concern regarding capacity issues within the Audit Section. He pointed out that the performance of the Audit Section was a matter of public record and in the public domain and this needed to be addressed accordingly.
The Head of Internal Audit advised that even if additional resources were made available within the Section,procedurally there were no mechanisms that would allow for further ‘follow up’ audits to be undertaken (and to her knowledge this was the case nationally). The officer pointed out that at the conclusion of the follow up audit it was the remit of the appropriate department to ensure that the recommendations were implemented and the Audit Section’s resources were then applied to undertake higher priority audits.
A discussion ensued when Members agreed to note the information contained in the report but proposed that the Social Services and Active Living Scrutiny Committee receive progress reports in respect of the outstanding actions highlighted as part of the System Audit on Residential/Nursing Home Placements and the matter be referred accordingly.
FURTHER RESOLVED, subject to the foregoing, that the Social Services and Active Living Scrutiny Committee receive progress reports in respect of the outstanding actions highlighted as part of the System Audit on Residential/Nursing Home Placements and the matter be referred accordingly. / Andrew Day