| Place: | Cross Room, Civic Centre, West Paddock, Leyland, PR25 1DH |
| Present: | Councillor O'Hare (in the chair) Councillors W Bennett, Foster, Michael Green, Mrs Mort and Patten. Other Councillors:- Councillors Clark, S Robinson, Mrs M Smith and P Smith |
| In attendance: | Director of Corporate Governance (Maureen Wood), Head of Shared Financial Services (Susan Guinness), Head of Shared Assurance Services, (Gary Barclay), Internal Audit Manager (Clare Ware) and Democratic Services Manager (Martin O?Loughlin) |
| Public attendance: | 0 |
| Other Officers: | Chief Executive (Mike Nuttall) Gareth Winstanley, (Audit Commission) and Peter Buckley (Audit Commission) |
| Item | Description/Resolution | Status | Action | |
|---|---|---|---|---|
| OPEN ITEMS | ||||
| 51 |
Apologies for Absence No apologies for absence were submitted. |
Agreed | ||
| 52 |
Minutes of the Last Meeting Minutes attached Min no 49 b) Desk Top Replacement Councillor Foster asked how the Committee was going to take forward the consideration of IT procurement and it was agreed to consider it under the Committee?s Forward Plan later in the meeting. Min no 49 2) VAT Rebate Head of Shared Financial Services updated the Committee on the current situation with regard to VAT rebate and confirmed that this would be included in the Year End report. RESOLVED (unanimously): That the minutes of the meeting held on 12 March 2012 be approved as a correct record and signed by the chairman. |
Agreed | ||
| 53 |
External Audit - Update on Matters relating to External Audit Report (194K/bytes) attached Gareth Winstanley from the Audit Commission reported that they were currently in the process of updating their understanding of the Council?s key financial systems maintaining close liaison with the Council?s finance team around technical issues, closedown timetable and audit requirements. He also reported that through meetings with key officers and review of relevant reports, they were currently undertaking work to support their VFM conclusion but that there were currently no issues or new audit risks which were needed to be brought to the Committee?s attention. Gareth Winstanley confirmed the outcome of the procurement exercise to outsource the work currently undertaken by its Audit Practice and that Contracts will be let from 2012/13 on a five-year basis: This Council?s Contract would be with Grant Thornton and would be, for 2012/13 ?57,664, compared to ?96,106 in 2011/12. For the audit of grant claims the previous schedule of hourly rates has been replaced by a composite indicative fee. For South Ribble the fee for certifying grant claims has been set at ?12,100 compared to ?20,057 in 2010/11. Whilst welcoming the reduction in cost of the Council?s External Audit the Committee expressed considerable concern about the abilities of the new company to provide as rigorous an External Audit on such a substantial reduction in fee. They also questioned the knowledge base of the new company whilst accepting that many of the existing staff of the Audit Commission would transfer to the new company. Concern was also expressed that although the fee was fixed for the basic audit work and grant claims there may be hidden costs for any additional audit work that may be required. The Chairman thanked the External Auditors for their report and attendance. RESOLVED (unanimously): That the report be noted and the reduction in fee be welcomed and that the Committee look forward to no reduction in service as a result of the reduced fee, whilst noting the possibility of additional charges for additional services. |
Agreed | ||
| 54 |
Internal Audit - Audit Plan 2012/13 Report (146K/bytes) attached Clare Ware, Internal Audit Manager introduced this report which explained the content of the Internal Audit work programme for the 2012/13 financial year which has been determined following a detailed risk assessment and consultation exercise. The Internal Audit Plan was the vehicle by which audit workload is identified and prioritised. The main purposes of the report were to remind members of the respective roles of managers and Internal Audit to maintain a sound system of governance and internal control within the Council. The report summarised and explained the basis of the Annual Internal Audit Plan for 2012/13 and the priority areas to be reviewed during the year and sought the Committee?s approval of the Audit Plan. Councillor W Bennett questioned what member involvement there had been in decisions on what should be included in the Audit Plan and he was informed that the Audit Plan was developed following consultation with the Senior Management Team taking into account the risk assessments. Councillor Patten questioned the external contract and was informed that the payment rate was a commercial rate and that St. Catherine?s Hospice had requested the Audit as part of their governance arrangements. The Chairman questioned whether we should be looking at risk related to the change of external Auditors and was informed that the internal audit approach was unlikely to change but it was too early to be definitive. Reference was made to the inclusion in the Audit plan of the replacement windows contract and the Committee were informed that this was a review of the whole of the contract and would be reporting its conclusions sometime in the new year. Councillor Foster asked if the procurement process could be looked at as part of the audit of the replacement windows contract and the Gary Barclay Head of Shared Assurance Services confirmed that this could be done for a report to be prepared for the June Governance Committee without having any impact on the remainder of the Audit Plan. RESOLVED (unanimously): 1. That the 2012/13 Internal Audit Plan be approved 2. That a review of Windows Replacement Contract tendering procedure be included in the plan as part of the proposed review of the Window Replacement Contract |
Agreed | ||
| 55 |
Consultation on the Tendering Process for the Council?s Banking Services from 01/01/2013 to 31/03/2018 Report (67K/bytes) attached Appendix 1 (32K/bytes) attached Susan Guinness Head of Shared Financial Services introduced this report on the present banking contracts for both South Ribble and Chorley which expired on 31 March 2013 and which proposed a joint tendering process for the procurement of banking services for the following five years. Awarding this contract at the conclusion of the evaluation process would be a key decision with the preceding evaluation criteria being set and approved under delegation by the Executive Member and this report sought the views of the Governance Committee on the evaluation criteria to be used in the tender process She further reported that in drafting the tender invitation the key considerations have been that each Council should be able to make its own decision in awarding the contract. That the evaluation criteria should allow for the inclusion of changeover costs. That the evaluation criteria should give both Councils maximum flexibility to obtain the banker that it considers to be offering the best option to them. That tendering banks should have an acceptable ?credit quality?. The Cabinet Member for Finance and Resources informed members of the Governance committee that he had discussed the report with Susan Guinness and had expressed his concern at the scoring system which he believed was flawed and put price over quality. He also expressed his concern at the appointment of consultants to advise on the tendering procedure. Councillor Patten expressed his concern that the Co-op Bank had been excluded because of its credit rating when it had 35% of the local government banking market. It was explained that the Council?s Treasury Management Strategy precluded putting money in banks that had a credit quality below a certain level. Other members of the Committee also expressed their concerns over the scoring system and the use of consultants. Susan Guinness explained that the consultants brought a knowledge of the area and an ability to prepare the necessary documentation that was unavailable in the Shared Financial Services. The Chairman in summing up indicated that if the Head of Shared Services felt there was a need for external assistance that should be accepted but that the view of the Committee was that the scoring system should be, if not reversed, at least revisited. RESOLVED (unanimously): That, whilst agreeing that a single tendering exercise should be undertaken with Chorley, with separate tenders being obtained for each authority, before a final decision is made on the evaluation criteria the proposed scoring system should be reconsidered and agreed with the Cabinet Member for Finance and Resources in consultation with the Chair of Governance Committee. |
Agreed | ||
| 56 |
My Neighbourhoods - Governance Arrangements My Neighbourhood - Governance Arrangements (106K/bytes) attached Maureen Wood, Director of Corporate Governance introduced this report which had been prepared to provide the Governance Committee with information on the governance arrangements that are being proposed to control My Neighbourhood capital expenditure. Members will recall that the committee requested, at its meeting on 1 December, a report to be brought to this meeting explaining how the system would work and this report sought to explain the various stages involved in obtaining approval for the capital expenditure. Councillor M Green thanked Maureen Wood for the report and clarified that the core funding referred was capital as well as revenue which was accepted by Maureen Wood. Reference was made to the repeated inference in the report that there needed to be agreement by all i.e. ?unanimous? agreement which, it was accepted, would not be always possible to achieve and that this should be amended in the flow chart to a ?majority? of Members. The Chairman questioned how you can ever get a ?formal? agreement from an informal meeting. The Committee expressed their continued concern that the process did not ensure that the decisions taken would be as a result of discussions between all members of the My Neighbourhood area and that there needed to be put in place a robust uniform procedure that was understood by everyone and was subject to an audit trail which showed how the decision had been reached and that every member of the My Neighbourhood Area had been given the opportunity to have their views taken into account. The Chairman reminded members that these decisions were subject to ?Call In? and Maureen Wood explained the Scrutiny Call In procedure. Councillor Foster asked that any procedure for reaching a decision should be as robust as other procedures. RESOLVED (unanimously): 1. That the Committee note the proposed procedures. 2. That that unanimous agreement amongst all members of a ?My Neighbourhood? implied in the report was unrealistic and that it should be a ?majority? and requested that a process be developed that was accountable and provided an audit trail on how the ?majority? decision was reached. |
Agreed | ||
| 57 |
Forward Plan Plan (52K/bytes) attached The committee received and noted its Forward Plan. Reference was made to the IT procurement matter raised earlier in the meeting and it was agreed that the Director of Business Transformation be asked to explain the IT procurement policy to the June meeting. It was agreed that the next stages of the Constitution review be included on the forward plan for the June Meeting It was noted that the item requested under Minute 55 above for an Internal Audit review of Windows Replacement Contract tendering procedure should also be included in the Forward Plan for June. RESOLVED (unanimously): That the committee?s Forward Plan be amended in accordance with the above. |
Agreed | ||