Apologies for absence were received from Councillors Danny Brookes, Adrian Benjamin and Colin Davie.

Those present were noted as in attendance.

At this point in the meeting, Members were invited to declare any relevant interests. 

·         Councillor Jill Makinson-Sanders asked it be noted that her son worked in the Economic Growth Team on Business Grants, Minute No. 24 refers.

·         Councillor Paul Hibbert-Greaves asked it be noted that he was a Director of PSPS Limited.

·         Councillor David Andrews declared that he was a Member of the General Licensing Committee, Minute No. 25 refers.

To confirm the Minutes of the Meeting held on 30 June 2021.

The Minutes of the Meeting held on 30 June 2021 were agreed as a correct record.

The Chairman informed Members that following a discussion with the Section 151 Officer, it was agreed that ideas for a future training programme would be considered by the Section 151 Officer with a view to delivering it across the Partnership.

A Member queried whether the feedback from the Skills and Knowledge Questionnaire recently circulated to Committee Members had been evaluated.  It was confirmed that the responses had been forwarded to the Monitoring Officer who would be presenting a report with the outcomes and future training needs identified to the next Committee meeting and would be considered as part of a future training programme.

A Member queried whether it would be possible for the training to run concurrent with the Committee meetings to lessen the travelling and contact between Members.  The Chairman responded that it was intended to hold the training sessions remotely to avoid unnecessary contact and would also be delivered in smaller more manageable sessions.

Actions from the last meeting.

The actions from the Meeting held on 30 June 2021 were confirmed as in hand or completed.

Action No. 8 (b) – Internal Audit Annual Report 2020/21 – ‘Clarification on whether the Council had a specific Value For Money (VFM) Policy, page 33 of the Agenda refers.

A Member referred to the response to the action, however considered that value for money was not just measured through procurement but true service delivery projects and queried whether there was any further action to be taken with regards to a specific VFM Policy.  Members were advised that a joint VFM audit was to be undertaken with Boston Borough Council as detailed on the Audit Plan 2021/22, page 81 of the Agenda refers, following which it was further queried whether this audit would look at value for money across the councils for all activities and not just procurement.

The Internal Audit Manager informed Members that the external auditors were undertaking further value for money work in 2021/22 and when this was completed it was part of the audit plan to do further work around that whilst making sure was not duplicated.

A Member added that he hoped that the auditors were not just looking at systems, but the actual delivery of value for money and a proper evaluation to ensure the Council was getting value for money on all of its projects.  It was however, acknowledged that this would be difficult in relation to the inflation situation in relation to construction costs on the capital programme.

A Member highlighted that a piece of scrutiny work was being undertaken on how the Council could respond to its communities’ needs post COVID and the Panel had interviewed all departments within ELDC which had identified that the Council did not have its own in-house procurement and was currently using Kings Lynn and West Norfolk Borough Council for its procurement.  A concern was raised that it was an oversight that the Council did not have an efficient and effective procurement department and should be looked at as a matter of urgency.

The Section 151 Officer advised Members that it was an area of focus that had been identified whilst looking at procurement generally.  It was confirmed that an audit on this was underway that was due to report back and there was also an advert out for resources at the moment.  It was considered that it would be sensible to look at working on a collective basis, however there was a challenge with recruiting.  The most important thing was to embed processes and procedures and invest time in training staff early on in the process.  It was highlighted that the Council had a lot of procurement planned which needed to go through due process and it was a significant piece of work for both regular work and major projects and the timescales would vary according to which element was being looked at, at that time.  The Section 151 Officer added that currently the Council was resourcing procurement  ...  view the full minutes text for item 24.

To receive a report from the Principal Licensing Officer.

Members received a report from Adrian Twiddy, Principal Licensing Officer which sought Members’ support to amend the Council’s Scheme of Delegation in relation to animal welfare licensing enforcement powers, pages 57 to 62 of the Agenda refer.

Members were advised that the report recommended a procedure for the urgent suspension or revocation of a licence where information was received of a serious nature that may affect animal welfare as the Council’s current procedure did not address cases where such immediate action was warranted. The proposed procedure was set out at Appendix A, pages 63 to 64 of the Agenda refer.

It was highlighted to Members that the report further sought to support to amend the Scheme of Delegation in relation to a refusal of a licence where the applicant did not achieve the statutory minimum licensing standards.

Members noted that the content of the report was considered and supported by the General Licensing Committee held on 5 July 2021, Minute No.12 refers.

Members were invited to put their comments and questions forward.

·         A Member commented that she supported this and queried how often urgent suspension or revocation powers were required to be invoked.  The Principal Licensing Officer responded that he expected this to be a rarity.

·         A Member queried whether delegation could be given to officers rather than the service managers as they were mandated to report their actions to the following Licensing Committee and by process this would keep the committee informed of any actions taken.  The Principal Licensing Officer informed Members that the procedure included a process for reporting to Licensing Committee and also to report to the Chair and Vice-Chair of Committee if any action was going to be taken under an emergency revocation or suspension procedure.

·         A Member commented that the Licensing Regulations in relation to animal welfare was introduced in 2018 and queried whether the change to the delegated authority to act upon information received was as a result of an incident.  The Principal Licensing Officer explained that a review was being undertaken since the introduction of the animal welfare legislation during the past couple of years, whereby it was flagged up as an area for attention and also during a debate by officers during a case presented to committee on whether it was classed as an emergency.

·         A Member provided anecdotal evidence of a situation with animals that caused grave concerns in her Ward, following which the Principal Licensing Officer commented that he would not comment in detail on individual cases, however confirmed that the licence referred had been checked and no issues were raised following an inspection by the animal welfare officer who was happy for the licence to continue.

No further comments or questions were received.

It was proposed and seconded that the report be accepted.

Following which it was,

RESOLVED:

1.   That Council be advised that Audit and Governance Committee support amendment of the Council’s Scheme of Delegation in order to delegate authority to the Service Manager – Safer Communities to  ...  view the full minutes text for item 25.

To review the Action Plan.

Christine Marshall, Section 151 Officer presented Members with an Action Plan which was developed to address the points raised by Internal Audit in the Internal Audit Annual Report 2021/22 and had been further highlighted as areas of concern by the Committee, Minute No. 8 from the Meeting held on 30 June 2021 refers. 

A copy of the Action Plan was circulated electronically to all Councillors for comment on 12 July 2021 and an updated version is attached to the Agenda, pages 65 to 66 refer.

Members were advised that there was an update against all of the actions identified and it had been agreed that the progress against the actions would be reported to Committee, following which Members were invited to put their comments and questions forward.

·         A Member commented that a large number of the actions had been allocated to the Section 151 officer and Deputy Chief Executive (People) both who were new to ELDC and asked for assurance that they had been well briefed as to the current situation.  The Section 151 Officer responded that she would be working with the Monitoring Officer to look at the governance framework, ethical framework and financial framework and assured Members that she would familiarise herself with the details as widely as necessary.

·         A Member referred to a comment from a previous item that the risk register was not currently being updated.  It was highlighted that risk was a common theme in the action plan and queried how the Committee could be assured that up to date risk was being considered whilst these matters were under consideration.  The Section 151 Officer advised Members that the review of risk was embedded within the Council’s processes, for example within a new project management framework that had been rolled out across the authority.  The Council would also have a way of monitoring and managing risk at a service level and a strategic level for emerging risks.  It was acknowledged that the Council’s risk register would have to be updated to reflect the changes over the past twelve months due to the alliance with Boston Borough Council and more recently entering the partnership with South Holland District Council and the associated strategic risks with that and work was currently underway on this.

A Member asked that information be provided when it was expected that all information on the various risk registers would be up to date.  The Section 151 Officer informed Members that she would confirm the timelines after speaking with the relevant officer.

·         A Member referred to Action 8 ‘The recruitment of a Procurement Manager’ on the plan with an amber status and a deadline of October 2021, page 6 of the Agenda refers.  It was queried whether a Procurement Manager would be in place by the next Committee meeting on 24 November 2021 and also whether Action 10 ‘Undertake a governance health check’ with the same timescale would be reported back to Committee.  The Section 151 Officer informed Members that the process for recruiting  ...  view the full minutes text for item 26.

To receive a report from Assurance Lincolnshire (Internal Auditor).

Matthew Waller, Audit Manager, Assurance Lincolnshire, LCC presented Members with the Internal Audit Progress Report Quarter 1 2021/22 which covered the period 31 May 2021 to 31 July 2021.

The purpose of the report was to provide Members with:

·         Details of the audit work completed during the period;

·         To advise on progress with the 2020/21 and 2021/22 plan;

·         To raise any other matters that may be relevant to the Audit Committee role.

Members noted that one assurance report had been issued since the last progress report in June 2021 as follows:

• Covid-19 Business Grants 2020/21 – High Assurance, page 70 of the Agenda refers.  (Assurance definitions were detailed at Appendix 1, page 73 of the Agenda refers).

Members were advised that there were currently ten audits as work in progress as follows:

2020/21 Audit Plan

·         Development Company – Fieldwork stage

·         Health and Safety (Magna Vitae) – Draft Report

·         New Finance System Support – Draft Report

·         Procurement – Draft Report

2021/22 Audit Plan

·         Payroll – Fieldwork stage

·         Brexit – Fieldwork stage

·         Towns Fund – Fieldwork stage

·         Housing Benefit Subsidy Testing – Fieldwork stage

·         Flood Management – Planning Stage

·         Carbon Reduction – Planning Stage

The Audit Manager advised Members that following on from the last meeting, Internal Audit was supporting management with the Governance Action Plan which was produced to support areas raised in the Annual Audit Opinion Report 2020/21.  A phased approach to supported management had been agreed starting with a health check review of good governance.

Members were advised that the 2021/22 audit work commenced on 21 July 2021 and performance on Key Indicators as at 31 July 2021 was highlighted as follows:

• Percentage of revised audit plan completed – 15%
• Percentage of recommendations agreed – 100%
• Percentage of agreed actions implemented – 19% (16 actions were due for implementation during the quarter, of which 3 were implemented.  Details of these overdue actions were detailed at Appendix 3, pages 74 to 78 of the Agenda refer.

A summary of the number of outstanding agreed actions and details for all audits as at 31 July 2021 was highlighted to Members at Appendices 2 and 3, pages 71 to 76 of the Agenda refer. 

Members were referred to Appendix 6 – Record of changes to the Internal Audit Plan 2021/22, pages 84 to 85 of the Agenda refer.

Members were invited to put their comments and questions forward.

·         A Member referred to the performance on key indicators, page 72 of the Agenda refers and highlighted that the actual of 15% was behind target at 25% and queried whether this was related to staffing issues or other factors.  The Audit Manager responded that it was not unusual for the performance to be behind target in the first quarter’s report and highlighted that there was some audits on the 2020/21 plan that was being finalised and COVID-19 had also had an impact on delivery.  Members were assured that staffing levels were sufficient to deliver on the audits planned and this would be reflected in  ...  view the full minutes text for item 27.

To receive a report from Mazars LLP, External Auditors.

Jon Machej, Mazars LLP (External Auditors) presented Members with the Audit Completion Report on the Council’s Financial Statements for the year ended 31 March 2021, the purpose of which was to summarise its audit conclusions.  The report was detailed at pages 87 to 124 of the Agenda referred.

Members were advised that the scope of the work identified significant audit risks and other areas of management judgement and was outlined in the Audit Strategy Memorandum Year Ended 31 March 2021 presented to Committee at its Meeting held on 17 March 2021, Minute No. 51 refers. 

Mr Machej advised Members that the audit was substantially complete, however wished to draw Members’ attention to the following areas that were set out as still outstanding at the time the report was written, page 93 of the Agenda refers.

·         With regards to the journals, all evidence required had now been received and Mazars had been able to conclude on that with no issues to be reported.

·         There were a large number of Member Related Parties forms still outstanding that had not been returned and without those forms Mazars was unable to conclude on the completeness of the Council’s related party disclosures and stressed that it was imperative that those forms were returned.

·         The majority of the work on Property, Plant and Equipment was complete although there were a couple of issues still to be resolved.  The first was in relation to a potential market value uncertainty declared by the Council’s Valuer, with the report to be considered and revised as appropriate.  The second issue was in relation to the floor areas that the Council’s Valuer had used in a number of valuations with more information or verification required of floor areas for some assets.

·         Outstanding assurance had been received on pensions from the auditors of the Local Government Pension Scheme (LGPS) for Lincolnshire and that work had now concluded.  A £1.4m error in the Council’s balance sheet for pensions had been identified.

·         Management’s paper on Going Concerns had been received and this had been concluded as there were no issues arising from that.

·         The National Audit Office had still not issued any guidance in relation to Whole of Government Accounts (WGA) for 2020/21 and this could not be completed.

Members were advised that a formal follow-up letter would be issued when these issues were concluded prior to Mazars issuing its opinion and would be circulated to Members when available ahead of the next Committee meeting.  A letter was circulated electronically to Members ahead of the meeting ‘Audit Letter – Delay in Issuing the Auditor’s Annual Report’ and is attached at Appendix A to the minutes.

Members’ attention was further drawn to significant findings that were identified as part of the audit plan that was issued in early 2021.  With the exception of the Property, Plant and Equipment issue Mazars was happy to conclude that there were no issues arising from any areas that needed highlighting to Members.

Members were advised that there had only  ...  view the full minutes text for item 28.

To receive a report.

Ellie Stacey, Deputy Chief Finance Officer (Corporate), PSPS Limited presented Members with the audited Financial Statements for the Year Ended 31 March 2021 including the Annual Governance Statement (AGS), detailed at Appendix A, pages 129 to 244 of the Agenda refer and asked that Committee considered and approved the Financial Statements 2020/21 and AGS for publication if no adjustments were required as part of the ongoing audit work by Mazars LLP (External Auditors). 

The Deputy Chief Finance Officer (Corporate) informed Members that the statements were currently still being audited, therefore if any figures did not materially change as a result of the audit then it was requested that delegated authority was given to the Chairman of the Committee in conjunction with the Section 151 Officer to make the required changes.  Members noted that the unaudited Financial Statements 2021/21 were presented to Committee on 30 June 2021, Minute No. 12 refers.

Members were advised that the Deputy Chief Finance Officer (Corporate) would continue to work closely with Mazars LLP, External Auditors to respond to any outstanding queries and bring the audit to the required conclusion.

Further to the adjustments highlighted by Mr Machej on the previous item, the Deputy Chief Finance Officer (Corporate) advised Members a further amendment had been made to the accounts regarding the value of one of the property funds where the incorrect asset value was found to have been taken from the property fund report, however this was below the triviality level of £59k and confirmed that all adjustments had been made in the various notes and primary statements.

As the draft accounts were produced earlier than the statutory deadline on 1 August 2021 a further review was undertaken on other aspects by the Finance Team once the audit had commenced and had made a further couple of changes as follows:

·         A £42k adjustment was made to the value of the amount owing to Boston Borough Council at the year-end regarding costs related to the Strategic Alliance.

·         The Impairment Allowance relating to business rates in the collection fund was revisited to ensure that sufficient provision was made for potential non-payment of business rates due to the impact of the pandemic.  This resulted in an increase in the deficit attributed to the Council, however also resulted in additional tax income guarantee grant due to the Council.

Members were advised that with regards to Paragraph 2 of the report, page 127 of the Agenda refers, it was considered that having regard to the Council’s arrangements and such factors as highlighted in the report that the Council remained a ‘going concern’ and the Council’s accounts for 2020/21 had appropriately prepared on that basis.

Members were further advised that no further changes had been made to the Annual Governance Statement.  This was required to be signed by the Leader of the Council and the Chief Executive and arrangements would be made for this prior to the publication of the accounts.  The Letter of Representation was required to be signed by the  ...  view the full minutes text for item 29.

To receive a report.

The Chairman informed Members that Sean Howsam, Treasury and Investment Manager, PSPS Limited had recently retired and asked that on behalf of the Committee very best wishes be sent to Sean who had served the Committee well for many years.

Members were advised that Jacqueline Mundy had been appointed as an interim replacement and would be presenting the treasury management reports moving forward.

The Chairman welcomed Steve Houchin, Chief Finance Officer, PSPS Limited to the meeting to present Members with the Treasury Management Report for Quarter 1 of 2021/22, pages 245 to 248 of the Agenda refers.

Members were referred to Appendix A which contained full details, pages 249 to 264 of the Agenda refer. 

The Chief Finance Officer explained to Members that the report provided Members with an update on the Council’s Treasury Management Strategy Statement and Annual Investment Strategy at Quarter 1 in line with CIPFA’s revised Code of Practice for Treasury Management in 2017 as requested by Audit and Governance Committee.

Key points were highlighted as follows:

·         Section 2 - An update on the national and international background influencing the outcome of investments made by various institutions provided by Link Asset Services, the Council’s treasury advisors, full details were outlined at pages 250 to 255 of the Agenda.

·         Section 3 – Information that provided details around interest rate forecasts, full details were outlined at pages 255 to 257 of the Agenda.

·         Section 4 – Information relating to cash investments and long-term investments including property funds that the Council had made, full details were outlined at pages 258 to 262 of the Agenda.

·         Section 5 – Details of the Council’s external borrowing position at the end of Quarter 1, full details were outlined at pages 262 to 263 of the Agenda refer.

Members were invited to put their comments and questions forward.  None were received.

Following which it was,

RESOLVED:

That the Treasury Management Report Quarter 1 2021/22 be noted.

To receive a verbal update.

The Chairman welcomed Alison Sparks, Deputy Monitoring Officer (DMO) to the Meeting.

The DMO advised Members that Mark Stinson had recently been appointed to Monitoring Officer across the three organisations and there were also four DMOs across the partnership.

The DMO advised Members that she had mainly been looking at governance issues for the towns and parishes and any legal queries that needed addressing.

The MO was currently looking at the revised Code of Conduct (the Code) published by the Local Government Association and a report would be presented to Committee at its meeting to be held on 24 November 2021 following which it would be presented to Council on 15 December 2021.  Members were advised that the revised Code came with lengthy guidance notes which was very useful and provided a lot of examples and it also included a code of practice for social media.

Members were invited to put their questions and comments forward.

·         A Member queried whether the new Code of Conduct would contain any legal differences as currently a problem for the MO function was lacking enforcement.  This had been a frustration for Councillors for a long time as existing sanctions were so lenient that they may well be non-existent or to the other extreme a prison sentence may be imposed but there was nothing in between.  It was highlighted that a consultation had been undertaken on new legislation in early 2019 and queried whether there had been any movement on that which would allow the MO to exercise sanctions to make a difference.

The DMO advised Members that the new version of the Code was a revision of the original Code to make it more robust and useful and confirmed that there had been no changes to the legislation and furthermore was not aware of any changes to legislation coming forward regarding sanctions, however would check with the MO.

·         A Member commented that there had been challenges in the past where Councillors had been perceived to be doing things against the Nolan Principles, but it had been argued that this was undertaken in their own time and not in their role as a Councillor.  However, there were Members who considered themselves to be Councillors 24 hours a day.  It was highlighted that over the years there had been a large number of MOs who had different views on this and interpreted the rules differently Members did not feel supported by MOs when there was a concern over behaviour.  It was considered that this reflected on all Councillors irrespective of which tier or authority was involved.

The DMO responded that she understood the point made and it was sometimes a fine line between when someone was or wasn’t acting in their capacity as a Councillor, or giving the impression that they were.  This was something that would be addressed in the revised Code and there was case law on that which assisted MOs when they were considering such matters along with the independent person.  The DMO  ...  view the full minutes text for item 31.

The programmed date for the next Meeting of this Committee will be Wednesday 24 November 2021.

The date of the next Meeting was confirmed as Wednesday 24 November 2021.