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Agenda and minutes

Venue: Committee Room 3 - Waltham Forest Town Hall

Contact: John Williams, Democratic Services Officer  020 8496 4344 | Email: john.williams@walthamforest.gov.uk

Items
No. Item

1.

APOLOGIES FOR ABSENCE AND SUBSTITUTE MEMBERS

Minutes:

Apologies for absence were received from Councillor Naheed Asghar and from Caryle Webb-Ingall, Independent Co-opted Member.

 

It was noted that Councillor Steve Terry was present as substitute for Councillor Asghar.

2.

DECLARATIONS OF INTEREST

Members are required to declare any pecuniary or non-pecuniary interests they or their spouse/partner may have in any matter which is to be considered at this meeting. Interests are defined on the inside cover of this agenda.

Minutes:

None.

3.

MINUTES OF THE PREVIOUS MEETING pdf icon PDF 87 KB

Minutes:

The minutes of the meeting held on 9 March 2017 were approved as a correct record and signed by the Chair.

4.

TREASURY MANAGEMENT ANNUAL REVIEW - 2016/17 pdf icon PDF 99 KB

Additional documents:

Minutes:

Consideration was given to a report of the Pensions and Treasury Manager and Senior Accountant.

 

Vincent Yeboah introduced the report, which was required by regulations.  It was one of a set of three, also including the mid-year update and the annual strategy agreed for the year ahead.

 

The Chair queried the underborrowing of £19,469,000 at 31 March 2017, and this was corrected to read £44,749,000.

 

Councillor Davis asked whether higher interest loans could be refinanced now that rates are lower.  Officers said that they always sought to bring down the cost of borrowing, but there are instances where the premiums are too high to achieve this, with no discounts available to offset them.

 

Decision

 

The Committee recommended the Council to agree the Annual Treasury Management Review 2016/17, subject to the amendment above.

5.

DRAFT 2016/17 CORE FINANCIAL STATEMENTS SUBJECT TO EXTERNAL AUDIT AND MEMBER APPROVAL pdf icon PDF 75 KB

Additional documents:

Minutes:

Consideration was given to a report of the Strategic Director of Finance and Governance and the Chief Accountant.

 

The Committee received a presentation from the Chief Accountant.  The presentation slides have been appended to the electronic version of the minutes.

 

The Chair thanked Mr Moldon for a detailed and highly informative presentation, which led to a discussion in which the following points were made:

 

Business rates – It was explained that the Business Rate retention Scheme presents greater risks to the Council, since growth and successful valuation appeals may vary from those forecast.  This tax base is also volatile, and susceptible in times of economic downturn.  The Director of Financial Management and Accountancy outlined the possible impact of a successful appeal by Virgin Media who were seeking to move their business rate liability onto a central list for its broadband fibre optic network, which accounts for a substantial proportion of the Council’s business rate income.

 

Demographic change –Councillor Mahmud referred to the increase in population and how far this had been taken into account, for example in the provision of secondary school places.  Mrs Borkett said this was factored in, although it is an inexact science.  There has been a slowdown in the primary sector but an increase in the secondary sector as the birth rate bulge works its way into the system. In terms of planning school places it is challenging as school builds can take two to three years to complete. The backdrop however is the overarching policy of generating new sources of revenue and growing the Council’s tax base to help manage demographic pressure.

 

Capital Slippage – Can be regarded as a missed opportunity even if there was a good reason for it and there usually is.  Need to ensure there is clarity of requirements, anticipated funding and any implications of delays. The analysis of the 2016/17 capital outturn was reported to Cabinet in June 2017.

 

Prevention of homelessness – as a new statutory duty, this is likely to be costly although the full implications are being evlauated.

 

Highway and other infrastructure – the revaluation is not as imminent as originally thought but is likely to be more comprehensive than at present.  The Chair asked whether in a project such as Marlowe Road, the valuation was on land or buildings.  Mr Moldon explained that the land value as it stood was quite high, and the value would simply move from one asset category to another.

 

The Vice-Chair praised officers for their achievement in finalising the accounts despite a shorter closedown period and a major restructure of the Department.

 

Decision

 

The Committee noted the draft 2016/17 Core Financial Statements and Narrative Report subject to external audit and Member approval as set out in the appendices to the report.

6.

ASSESSMENT OF COUNCIL AS GOING CONCERN pdf icon PDF 137 KB

Minutes:

Consideration was given to a report of Strategic Director of Finance and Governance and the Chief Accountant.

 

Brian Moldon said this was a new report and although the notion of a ‘going concern’ was more relevant to the private sector, it was also good practice in local government.  He outlined the main reasons leading to the conclusion that the Council is indeed a going concern, including £158 million in reserves and £10 – 15 million in the General Fund. 

 

The Director of Financial Management and Accountancy added that this is a fundamental accounting principle which underpins the Annual Governance Statement, and that not all local authorities would be able to reach the same conclusion with the same degree of confidence.

 

Decision

 

The Committee noted the outcome of the assessment made of the Council’s status as a “going concern” for the purposes of the draft statement of accounts 2016/17.

7.

ELECTION PLANNING – 2018 pdf icon PDF 76 KB

Minutes:

Consideration was given to a report of Director of Governance and Law.

 

The Director introduced the report and said that the 2017 General Election that was not anticipated at the last meeting of the Committee had provided scope for greater practice and preparedness.  Processes are being reviewed and would be tested further at the William Morris ward by-election on 29 June 2017.  The choice of count centre is still under consideration.

 

The Vice-Chair noted that due to the short notice of the General Election, some of the polling stations used were outside the relevant ward.  Mr Hynes said the expectation was that this would not be the case in 2018 but any exceptions would be discussed with Ward Members.

 

The Chair praised the smooth process on 8-9 June but warned against complacency in the potentially more complex Council elections, for example the counting challenge posed where a party stands fewer candidates than the total seats available.

 

Decision 

 

The Committee noted the report.

8.

ANNUAL REVIEW OF COMMITTEE'S TERMS OF REFERENCE pdf icon PDF 67 KB

Additional documents:

Minutes:

Consideration was given to a report of Director of Governance and Law.

 

The Director introduced the report and highlighted the changes proposed, namely the proposal for the Committee to co-opt experts to assist with aspects of its work, and a redefinition of its membership in relation to Scrutiny.

 

Decision

 

The Committee endorsed the proposed changes to the existing Terms of reference and recommended them to the Council for formal adoption.

9.

OFFICE OF SURVEILLANCE COMMISSION (OSC) - INSPECTION REPORT pdf icon PDF 90 KB

Additional documents:

Minutes:

Consideration was given to a report of Director of Governance and Law.

 

The Director briefly introduced the report.  Members welcomed the outcome of a very positive inspection.

 

Decision

 

The Committee noted the report and endorsed the recommendations within the OSC Inspector’s Report.

10.

DRAFT ANNUAL GOVERNANCE STATEMENT pdf icon PDF 63 KB

Additional documents:

Minutes:

Consideration was given to a report of Director of Governance and Law.

 

The Director introduced the report and said that it was an important means of providing assurance to the Leader of the Council , the Chief Executive and himself as Monitoring Officer that  the Council’s business is conducted properly, the public money is safeguarded, accurately accounted for and the Council’s resources are used economically, efficiently and effectively.

 

Mr Hynes drew Members’ attention to topical risks associated with housing, austerity, cyber-attacks and new legislation aimed at preventing homelessness.

 

The Vice-Chair asked how the contract management framework was working, and was informed that the Director, Supply Chain monitors compliance and waivers.  The Committee looked forward to receiving his report at a future meeting.

 

With regard to the Scheme of Delegation, it was stated that this would be examined by the cross-party working group that would be established to review the Constitution from September onwards.

 

Councillor Terry asked about the Housing Repairs and Maintenance Contract, on which there are two years left, and Democratic Services undertook to send him the relevant reports and minutes of the Housing Scrutiny Committee.

 

Decision

 

The Committee:

 

(a)    approve the draft Annual Governance Statement; and

 

(b)    delegated to the Director of Governance and Law the authority to make any further amendments to the Annual Governance Statement that might arise prior to its publication with the audited Financial Statements.

 

11.

REVISED WHISTLE BLOWING POLICY pdf icon PDF 61 KB

Additional documents:

Minutes:

Consideration was given to a report of Director of Governance and Law.

 

The Director introduced the report, Councillor Davis asked how a whistleblowing concern would be followed up.  Mr Hynes said that he had overall responsibility for the policy.  There had been three concerns raised during his time with the Council, all had been investigated and in each case the outcome was reported back.

 

Decision

 

The Committee approved the revised Whistleblowing Policy.

12.

RISK MANAGEMENT UPDATE pdf icon PDF 88 KB

Additional documents:

Minutes:

Consideration was given to a report of the Strategic Director of Finance and Governance.

 

The Insurance and Risk Manager introduced the report and updated the Committee on progress.  The directorate risk champions in consultation with their Directorate Management Teams have fully reviewed their operational risks and updated risk on JCAD, the Council’s risk management system.  Programme risks have been incorporated into JCAD on a stand-alone risk register, facilitating improved reporting of cross cutting risks.

The Insurance and Risk Team has provided risk management support to the Strategic Partnership Unit in order to capture and manage risks through JCAD.   The Risk Management eLearning module has been reviewed and updated and will launched by the end of June 2017.

Ms Nitschke said the Insurance and Risk team have attended departmental management teams to facilitate risk identification, and the Directors of Housing and of Property and Asset management have asked for a review of operational risk across their areas.

An internal audit of risk management provided ‘reasonable assurance.’

The introduction led to a discussion in which the following points were made:

IT and Multi-Agency Work – The Vice Chair said it was of continuing concern that the IT systems used by agencies involved in key cross-cutting work such as tackling anti-social behaviour and child protection (through MASH, the multi-agency safeguarding hub) were unable to communicate with one another and share data.  The situation has prevailed for many years and is compounded by high levels of staff turnover including agency staff in areas such Housing and Neighbourhoods.  It affects the quality and capacity of services, and the safety and satisfaction of residents.

Members acknowledged that all departments identified and addressed operation risk, but expressed frustration that even strategic management could not fully address and mitigate the inherent risks in the Council’s external relationships.

 

Responses to major incidents – Members enquired further about the Council’s preparedness in the event of, for example, a plane crash given the proximity of City Airport, or indeed something akin to the very real tragedy that occurred at Grenfell Tower.

 

Officers explained that the response operated at several levels, from daily business continuity after an event, to addressing the aftermath right up to the reputation and viability of the Council and other public services.  A range of scenarios are now being run and stress-tested, and these can reveal unanticipated shortcomings that need to be addressed.  For example a local authority seeking to rehouse a number of residents immediately discovered that its corporate credit cards were rapidly spent up.

 

Members said they would appreciate a briefing from the Director of Housing.

 

Identifying worsening services – In response to a question from Councillor Terry, officers confirmed that rising staff sickness levels or complaints are picked up in each directorate, targets set and reviewed.  The Risk Management team now has the structure and support to maintain links with  departmental management teams and develop mitigation processes that are dynamic and agile.

 

Strategic Risk Register – Members noted with concern the inclusion of the Amey  ...  view the full minutes text for item 12.

13.

CORPORATE ANTI-FRAUD TEAM PERFORMANCE FOR 2016-17 pdf icon PDF 266 KB

Minutes:

Consideration was given to a report of the Head of Internal Audit and Anti-Fraud.

 

Gemma Young introduced the report and said her team was particularly proud of their work on social housing fraud, where a notional value of almost £9½ million in fraudulent occupancies, payments and applications had been saved.  She provided the Committee will examples of housing fraud, such as claims on behalf of a dead relative, and subletting.  Estate agents now have an app to identify Council property.

 

Members supported publicising successful prosecutions with named offenders.. 

 

Decision

 

The Committee:

 

(a)  noted the report; and

 

supported the publicity of successful prosecutions.

14.

AUDIT AND FRAUD DIVISION:INTERNAL AUDIT ANNUAL REPORT AND OPINION ON THE COUNCIL'S INTERNAL CONTROL SYSTEM pdf icon PDF 694 KB

Minutes:

Consideration was given to a report of the Head of Internal Audit and Anti-Fraud.

 

Gemma Young introduced the report and said that she was able to provide reasonable assurance, although her opinion was more marginal than in recent years, as the 23 limited and four no assurance were disappointing.  The Chair said that the two substantial assurances for Walthamstow Central regeneration and for Budgetary Control and Reporting deserved congratulation.

 

The Assistant Director, Property was present at the beginning of the meeting, when the failure to provide information in relation to the annual inspection programme for commercial properties was raised.  Auditors were unable to determine how frequently the building surveys were carried out and unable to provide assurance as to whether the maintenance of properties was being reviewed as required.

 

Mr Miller explained that the work had been given to an external contractor who had not proceeded with it.  There is now a replacement programme using the Council’s own staff, which now appears to be more cost effective in the longer term subject to a decision to restructure.

 

The Chair asked for an update, and Miss Young replied that the corrective action was part of a long-term plan, and officers would come back to the Committee in six months.

 

Decision

 

The Committee:

 

(a) noted the Head of Internal Audit and Anti-Fraud’s opinion on the Council’s system of internal control;

(b)  noted the annual report on the activities of the Internal Audit team; and

 

requested a further report on progress with the inspection programme for commercial properties in January 2018.

15.

INTERNAL AUDIT PLAN 2017-18 pdf icon PDF 153 KB

Minutes:

Consideration was given to a report of the Head of Internal Audit and Anti-Fraud.

 

Gemma Young briefly introduced the report and drew Members’ attention to the overlap and co-operation with the Insurance and Risk Team.

 

Decision

 

The Committee agreed the Internal Audit Plan 2017-18.

16.

CORPORATE ANTI-FRAUD TEAM - ANTI-FRAUD & CORRUPTION STRATEGY AND ANNUAL ANTI-FRAUD ACTIVITY PLAN 2017/18 pdf icon PDF 187 KB

Minutes:

Consideration was given to a report of the Head of Internal Audit and Anti-Fraud.

 

Decision

 

The Committee approved the Anti-Fraud & Corruption Strategy and Annual Anti-Fraud Activity Plan 2017/18.