Agenda and minutes

Members are asked to declare any interests in the items under consideration and in

doing so state:

(1) the type of interest concerned, either a

(a) personal interest

(b) prejudicial interest

(c) disclosable pecuniary interest (DPI)

and

(2) the nature of the interest concerned

If any Member requires advice on declarations of interests, they are advised to contact the Head of Democratic Governance in advance of the meeting.

There were no declarations of interest on this occasion.

To agree the minutes of the last meeting of the Audit Committee held on 25 March 2021 as a true and correct record.

The Committee agreed that the minutes of the meeting held on 25 March 2021 be signed by the Chairman as a true and correct record.

To consider a progress report on the recommendations made in the internal audit report of Business Support issued on 10October 2019.

Mr Peter Legg, Head of Economic and Cultural Services presented a progress report on the recommendations made in the internal audit report of Business Support which had been issued in October 2019. Mr Legg noted that the audit had taken place in late 2019 and as such a number of changes had been implemented within the service since that time, not least as a result of the ongoing pandemic. He provided a summary of the work undertaken by Mr David Slater, Business Growth Manager and his team, particularly in relation to the administration of discretionary COVID business grants over the last year. Mr Legg explained that the Council’s online business communication channels, centred around ‘Blackpool Unlimited.com’, had proven key in promoting government grant availability as well as providing wider support to new and growing businesses. He reported that the website had recently been improved and relaunched. The considerable impact on the level of work undertaken by the Business Support team as a result of the pandemic was highlighted by Mr Legg, as well as digital efficiencies and changes to the way in which the team operated and connected with businesses as a result of the lockdown restrictions.

Mr Legg identified that whilst a number of the recommendations resulting from the audit had been completed, others had been put on hold and would need to be revisited to address the changes in the type of business support being offered to include new methods being used to interact with customers. In relation to recommendation R4 ‘A full business case should be developed for any future investment in additional managed workspace facilities,’ Mr Legg reported that an advanced project proposal for an enterprise facility called ‘The Edge’ was in development, one of seven key projects within Blackpool’s Towns Fund programme.  A pre-condition of approval of the £6.3m project (£4.5m capital grant, and match funding of £1.8m) was a Treasury Green Book Business Case which would be subject to an in-depth appraisal. He advised of an anticipated completion date for the case and submission to government of November 2021.

With regards to recommendation R1 ‘Formal aims and objectives for Business Support should be determined, including identifying any future prioritisation on support to businesses with greater perceived growth potential, any development plans for the service and links to wider strategies and Growth and Prosperity aims and objectives,’ the Committee questioned how those sectors with the most growth potential would be identified. Mr Slater advised that the work recently undertaken as part of the Green Book Business Case for The Edge included an independent assessment of the start-up market in Blackpool and this had identified the sectors which had been growing within the town. Mr Slater noted the importance of striking the correct balance between providing support to those businesses who were striving for growth and creating employment opportunities as well as continuing to provide a service to those wishing to become self-employed and he noted that both these areas needed to be  ...  view the full minutes text for item 3.

To consider the controls being implemented to manage the strategic risk relating to the pandemic infection.   

[Ms Kate Aldridge, Head of Delivery and Performance joined the meeting during consideration of this item.]

The Committee considered a progress report outlining the individual risks identified within the Strategic Risk – Pandemic Infection. Consideration was given to the sub-risk ‘Impacts on the Council's ability to deliver critical services and wider impacts on the town,’ with Ms Liz Petch, Consultant in Public Health providing an update. Ms Petch informed the Committee that Dr Arif Rajpura, Director of Public Health attended weekly Covid-19 regional meetings withPublic Health England and other national and regional stakeholders. In addition, Dr Rajpura attended weekly meetings with the Chief Medical Officer in order to receiveupdates on Covid-19 risks and national action. Ms Petch outlined numerous regular meetings and decision-making forums in place across Lancashire which were attended by Blackpool representatives and highlighted the co-ordinated and proactive testing regime in place across the region which was sensitive to the emergence of new variants. She reported that Blackpool had increased testing as soon as this had become available and noted that Blackpool was one of the first local authority areas to pilot community testing, as well as the introduction of the ‘Local Zero’ contact tracing, which had both assisted in providing essential data in quickly identifying any outbreaks of the virus. She noted that whilst Blackpool reported low levels of infection currently, areas of concern still remained such as the emergence of new variants and international travel and as such partnership working continued on a local, regional and national level.

The Committee asked Ms Petch to identify the biggest challenge currently faced by the Public Health team as well as asking what the impact of the pandemic had been on the wellbeing of the team. Ms Petch reported that the provision of timely and accurate data was currently proving to be a challenge in terms of the results of self-administered tests carried out by individuals in their own homes. She informed the Committee that the initial pressures experienced by Public Health at the start of the pandemic had eased, aided by the provision of additional capacity in the form of health protection expertise and support from the wider Council community as a whole.

The Committee questioned whether plans were in place to deal with data collection as the summer season approached, noting that as a seasonal resort holiday-makers would be attracted to the area and as such an increased capacity for testing would presumably be required. Ms Petch advised that the Council’s Communications team had been utilised to broadcast key messages to the community to encourage the continuation of testing and the importance of maintaining social distancing to limit the spread of infection. She reported that partnership working had also been utilised, for example via holding regular meetings with headteachers to receive feedback on any current issues within schools and to provide current data on infection rates.

With regards to seasonal variations, the Committee sought information on the plans in place for autumn, with the anticipated  ...  view the full minutes text for item 4.

To provide the Audit Committee with a summary of the work completed by Risk Services in quarter four of the 2020/2021 financial year. 

Mrs Tracy Greenhalgh, Head of Audit and Risk presented a report summarising the work of Risk Services, including the overall assurance statements for all audit reviews completed in quarter four. Mrs Greenhalgh noted the ongoing support of the verification of business grants undertaken by her team. Details of the national risk register were provided, with Mrs Greenhalgh reporting that the Lancashire Resilience Forum had reviewed the national risks via the Risk Assessment Working Group and its various supporting sub-groups to assess pan-Lancashire impact.

The Committee was informed that the Health and Safety team continued to play a key role in providing advice, support and guidance to all Council services and schools with regards to safe working practices during the Covid-19 pandemic. This involved reviewing government and Health and Safety Executive guidance in relation to working safely during the pandemic and implementing any necessary changes or systems to ensure that the Council continued to be compliant. The team had been undertaking unannounced workplace inspections at some Council buildings to continue to ensure compliance with Covid-secure arrangements.

Mrs Greenhalgh provided an overview of the year-end position of the Risk Services performance indicators, reporting that she was pleased with the overall level of performance across Council departments. She noted that 80 per cent of the audit plan had been completed against a target of 90 per cent but that due to the increased demand on the internal audit team because of the pandemic this was a pleasing result and reflected a higher level of completion in comparison to other local authorities. Mrs Greenhalgh highlighted the disappointing percentage of risk registers which had been revised and updated, with 74 per cent having been completed by the end of the financial year. As a result, she advised that compliance would be managed via the Risk Management Group going forward.

In response to the question of whether the eight Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) reportable employee accidents had highlighted any trends, Mrs Greenhalgh confirmed that whilst a full accident investigation report had been completed on each incident, no trends had been identified.

Mrs Greenhalgh summarised the internal audit reports completed during quarter four, reporting an overall positive picture with only one area of concern highlighted as being that of the household waste recycling centre. She assured the Committee that a new service manager was now in place who would be addressing the resulting recommendations. The Committee noted that the identified Priority One recommendations would be addressed, but questioned whether the eight Priority Two and six Priority Three recommendations would also be followed up. Mrs Greenhalgh agreed to add follow-up of the Priority Two and Three recommendations to the Audit Committee’s plan. The Committee questioned the specific amount of income lost as a result of the identified lack of invoice generation for waste streams, which Mrs Greenhalgh agreed to circulate to Committee Members following the meeting.

In response to the reported completion of fraud awareness training for 2020/2021, the Committee questioned why  ...  view the full minutes text for item 5.

To provide updates in respect of Contract Management and Procurement arrangements from the Annual Governance Statements.

As previously requested by the Committee, Mr Steve Thompson, Director of Resources provided an update in respect of contract management and procurement arrangements from the Annual Governance Statements. He reported that in January 2020 a dedicated Social Value Co-ordinator post had been established on a two-year fixed term basis. A number of social value documents had been reviewed and updated and in April 2021 Executive approval was received for the updated Social Value Policy and the Suppliers Charter. In addition the Committee was informed that the Social Value guide issued to all suppliers at tender stage had been updated and the revised documents would be issued with all tender opportunities with immediate effect. In spite of the impacts of the Covid-19 pandemic, the Social Value Co-ordinator had been in liaison with a number of key providers to ensure the continued delivery of social value.

Mr Thompson informed the Committee that a contract management iPool training course had been developed and that to date 32 members of staff had completed the training. He advised that further work would be undertaken to target areas of the Council where staff should be actively encouraged to complete the course.

With regards to procurement, Mr Thompson reported that engagement with local suppliers took place where appropriate and where circumstances permitted on specific tender opportunities. He noted that often stakeholders failed to allow sufficient time between requiring a contractor to be in place and making an initial approach to the procurement team to enable supplier engagement and that the impacts of the Covid-19 pandemic had made engagement with local suppliers more challenging. The Committee was informed that a training event for Elected Members in relation to procurement had been scheduled for January 2022.

In relation to the Audit Committee’s role in monitoring these areas, Mr Thompson advised that completion data of the iPool contract management training could be included within the quarterly Risk Services performance reports going forward.

The impact of the pandemic on the number of available apprenticeships was queried, with Mr Thompson reporting that within the Council the introduction of the Kickstart initiative had created apprenticeship opportunities across all services.

Resolved: That the Chair of the Audit Committee give further consideration as to the role of the Committee in relation to contract management and procurement arrangements, in conjunction with Mrs Tracy Greenhalgh, Head of Audit and Risk.

The Audit Committee is asked to consider the Annual Audit report for the year ended 31 March 2021.

Mrs Tracy Greenhalgh, Head of Audit and Risk presented the Annual Audit Opinion and explained that her report detailed the individual and collective outcomes of the audit reviews undertaken in the year ended 31 March 2021. In addition, Mrs Greenhalgh provided an audit opinion on the control environment based on the audit work undertaken. She explained that the Annual Audit Opinion was one component that the Council took into account when compiling its Annual Governance Statement. The Committee was informed that the report also set out the proposed programme for Heads of Service to report progress against audit recommendations to the Audit Committee based on a random sample of audits.

Mrs Greenhalgh reported that as Head of Audit and Risk she was satisfied that sufficient assurance work had been carried out to allow the provision of a reasonable conclusion on the adequacy and effectiveness of Blackpool Council’s internal control environment. Her opinion was that the overall control environment of the Council was adequate. The regeneration programme being implemented by the Council had increased risk both in terms of project delivery and financial risks and the financial position of the Council’s wholly owned companies also created a number of financial sustainability risks which needed to be closely monitored going forward. Mrs Greenhalgh highlighted that the Covid-19 pandemic had impacted on the control environment and that this would continue to be monitored during 2021/2022 and steps taken to manage risk as effectively as possible given the challenging circumstances, with a particular focus on recovery and the impact on the sustainability of the Council. She noted that where weaknesses had been identified through internal audit work, the team had worked with management to agree appropriate remedial actions and a timescale for improvement. 

The Committee commended the work of the internal audit team during a challenging period and asked whether there were plans in place to address the number of ‘Adequate’ overall opinions and assurance statements with the aim of raising them to ‘Good’ in the future. Mrs Greenhalgh advised that whilst there was no corporate action plan specifically aimed at raising assurance levels to ‘Good’, recommendations for strengthening current arrangements had been included within all internal audit reports. In relation to the number of ‘Adequate’ assurances reported for the year, Mrs Greenhalgh suggested that this was in line with previous years and that in the challenging circumstances she was pleased that a higher number of ‘Inadequate’ assurances had not been given. She reported that the need to adapt to virtual auditing methods had initially proven challenging and her team had learnt that instead of aiming for perfection, it was more beneficial to ensure that risks had been adequately managed without the need to always focus on achieving best practice.

The Committee expressed its thanks to Mrs Greenhalgh and her team for all the hard work completed during a difficult year.

Resolved: To note the Annual Audit report for the year ended 31 March 2021.

The Audit Committee is asked to approve the Quality Assurance and Improvement Programme for the internal audit service for 2021/2022.   

Mrs Tracy Greenhalgh, Head of Audit and Risk informed the Committee that a requirement of the Public Sector Internal Audit Standards was that a Quality Assurance and Improvement Programme (QAIP) be implemented for the internal audit team and approved by senior management and the Audit Committee.

The Committee was informed that internal audit’s QAIP was designed to provide reasonable assurance to stakeholders of internal audit that the service performed its work in accordance with its Charter, which conformed to the requirements of the Public Sector Internal Audit Standards (PSIAS), it operated in an effective and efficient manner and

was perceived by stakeholders as adding value and improving operations.

Mrs Greenhalgh assured the Committee that the QAIP covered all aspects of the internal audit service in accordance with the PSIAS Standard 1300 (Quality Assurance and Improvement Programme), including:

·       Monitoring of internal audit activity to ensure it operated in an effective and efficient manner;

·       Ensuring compliance with the PSIAS’ Definition of Internal Auditing and Code of Ethics;

·       Helping the internal audit service add value and improve organisational operations;

·       Undertaking both periodic and on-going internal assessments;

·       Commissioning an external assessment at least once every five years, the results of which would be communicated to the Audit Committee and Corporate Leadership Team in accordance with the Standards.

With regards to the cited external assessment of the Council’s internal audit service conformance to the Public Sector Internal Audit Standards scheduled for June 2021, the Committee suggested that it might be beneficial for a range of Members from the Committee to be interviewed as part of the process instead of only the Chair, which Mrs Greenhalgh agreed to put forward to the assessors.

Resolved: To approve the Quality Assurance and Improvement Programme for the internal audit service for 2021/2022.   

To consider adopting a local code of governance, as recommended in the Annual Governance Statement Action Plan.

Mr Mark Towers, Director of Governance and Partnerships presented a proposed Code of Governance for consideration by the Committee. He noted that the Annual Governance statement action plan, as agreed by the Audit Committee in November 2020, had identified that in terms of good practice the adoption of a local Code of Governance was recommended. The mechanics of the Code were already in place as the Council utilised the principles in the Chartered Institute of Public Finance and Accountancy (CIPFA) Delivering Good Governance publication (2016)when it undertook its Annual Governance Statement Self-Assessment, but Mr Towers explained that the adoption of a code with these principles at its centre would clearly evidence how governance was being monitored in Blackpool.

The Committee was informed that the governance framework at Blackpool Council comprised the systems and processes, culture and values which the Council had adopted in order to deliver on the principles of good governance as defined by CIPFA. These principles had been used in recent years to compile the Annual Governance Statement and form the heart of the proposed Code of Governance. The approach at Blackpool had taken the form of using 15 thematic strands to document its assessment against the principles. Mr Towers asserted that this had been informally recognised as the ‘Blackpool Governance Framework’. In undertaking the drafting of the code, a further strand was being recommended, that of ‘Ethical and Responsible Governance’ to reflect the Council’s focus on climate emergency and equalities and diversity.

Mr Towers reported that an interim Annual Governance Statement had to be published by 1August 2021 to accompany the draft annual accounts. The final Annual Governance Statement and final Statement of Accounts had to be agreed by the Committee by 30September 2021. He recommended that, as Director of Governance and Partnerships, he be delegated to authorise that an interim Annual Governance Statement be published by 1August 2021 following consultation with the Chief Executive, Leader of the Council and Chair of the Committee.

A Partnership Governance Framework had also been recommended as part of the Annual Governance Statement Action Plan. Mr Towers explained that as this document would normally be based on the structure of the local Code of Governance, when this code was agreed by the Committee it was being recommended that a draft Partnership Governance Framework be brought to a future meeting of the Committee.

The Committee questioned how the Code of Governance would be utilised to effectively improve the Annual Governance Statement. Mr Towers advised that the thematic strands were not as currently visible to the Audit Committee and stakeholders, but that once they had been included as part of the Constitution, Members would be made more aware of them and Officers would be better able to identify supporting evidence over the course of the year due to the more prominent structure being in place.

Resolved:

1.       That the Audit Committee recommend to Council the adoption of the Code of Governance as presented and that this forms part  ...  view the full minutes text for item 9.

To consider the feedback from the self-evaluation exercise undertaken by the Audit Committee and senior officers who engage with the Committee on a regular basis and to approve the training plan.

Mrs Tracy Greenhalgh, Head of Audit and Risk presented the results of the self-evaluation checklist that Members of the Audit Committee had been invited to complete in order to help measure the effectiveness of the Committee. Also presented were the results from when the exercise had been completed in 2020, along with an indication of the direction of travel.

The Committee was informed that a number of Officers who engaged with the Audit Committee had also been asked to undertake an evaluation of the Committee based on their experiences. A number of questions had been asked, based on the CIPFA Guidance on Audit Committees and Officers were also asked to provide any comments or suggestions as to potential improvements going forward. The results from the Officer evaluation were presented for consideration by the Committee. The Committee suggested that it might be beneficial in future to include the external auditors in the completion of the evaluation.

Mrs Greenhalgh also presented the proposed Audit Academy training programme for 2021/2022, which identified the skills which would be developed as a result of the training as well as indicating the contents and date of each proposed session. The Chair of the Committee informed Members that the high quality training provided to the Audit Committee had been rebranded as the Audit Academy and that in order to acknowledge the accomplishment of attending each session, a certificate of achievement would be presented to all Members who completed the whole course.

Resolved: To approve the Audit Academy training programme for 2021/2022.

To consider the updates provided and to ask follow up questions as appropriate to ensure that all recommendations are implemented.

The Committee considered the updated Action Tracker, noting that no actions were due for further consideration at this time.

To note the provisional date and time of the next meeting of the Committee as 17 June 2021, commencing at 6pm.

The date of the next meeting of the Committee was noted as 17 June 2021 commencing at 6pm, subject to approval at Annual Council.