To confirm the minutes of the meeting held on 29 September 2022.

The Minutes of the meeting held on 29 September 2022 were agreed as a correct recorfd and signed by the Chairman.

Councillor Morton mentioned the reference to a request on page 7 of the Minutes (penultimate paragraph) in respect of the figures in terms of the spend for temporary accommodation that was supposed to be quantified at this meeting.

Alison Chubbock, the Assistant Director of Finance stated that such figures would be available as part of Quarter 3 Performance Report.

To receive apologies for absence.

None received.

Julie Britton, the Democratic Services Officer apologised to Mr Fowler, the Independent Lay Advisor for not including his name on the front of the Agenda again, this would be rectified for the June meeting.

To note whether the Chairman proposes to accept any item as urgent business, pursuant to Section 100(B)(4)(b) of the Local Government Act 1972.

None.

The duties to register, disclose and not to participate for the entire consideration of the matter, in respect of any matter in which a Member has a disclosable pecuniary interest are set out in Chapter 7 of the Localism Act 2011.  Members are also required to withdraw from the meeting room as stated in the Standing Orders of this Council.

None declared.

To note the names of any non-members wishing to address the meeting.

Councillor James, the Executive Member for Customer & Corporate Services and Councillor Cowen, Executive Member for Finance, Revenue & Benefits were in attendance to present Agenda items 8, 10 and 11 respectively.

Councillor Birt and Councillor Morton were also in attendance.

To note if there are any training issues/ requests.

None required.

Report of Cllr Jane James, Executive Member for Customer & Corporate Services.

Councillor James, the Executive Member for Customer & Corporate Services introduced the report.

She was pleased to inform Members that the strategic risks identified by the Council had reduced by one to 11, this risk related to Leisure Centres reopening that was discussed at the previous Committee meeting in September.  Attention was drawn to the waste consultation and Nutrient Neutrality risks.  It was noted that there had been movement in regard to these risks in relation to announcements and proposed ways forward, however, whilst these were steps in the right direction the Council had taken the decision not to change the current risk ratings.  The reason for this decision was that these announcements had yet to be translated into tangible mitigations that could possibly lower the risk.  She had not doubt that these announcements would be possible steps forward, but time would have to be allowed for them to become fully realised and implemented.

Ryan Pack, the Innovation & Change Business Partner provided further details in respect of the Leisure risk. This risk had been removed based on the fact that the levels of participation had now recovered and were back to pre-Covid levels and therefore was no longer considered to be a strategic risk to the Council.   Other risks mentioned were the rescoring of the IT cyber security and GDPR.  The IT cyber security risk had been rescored at the request of this Committee and the GDPR risk had been rescored at the request of the Auditors who believed the score to be too high. 

In response to a question about whether it was anticipated that the risks mentioned earlier in respect of Nutrient Neutrality and Waste consultation could eventually be moved into a lower category, the Innovation & Change Business Partner explained that there was nothing specific that he was currently aware of that would warrant decreasing those risks at the moment.

Mr Fowler, the Independent Lay Advisor drew attention to page 19 of the agenda pack under the rising temporary accommodation usage risk in respect of the potential consequences and asked what was meant by ‘large’ costs. Referring to the same risk, he also referred to the national awareness that had been raised in regard to poor housing conditions and asked if the Council considered this as a risk. Additionally, he queried the date of the National Planning Policy Framework (NPPF) review that could be found on page 23 of the agenda pack, as he was aware that this consultation was currently taking place at the moment and not in 2024 as mentioned in the register.

The Vice-Chairman, Councillor Kybird agreed with the latter query as a report had been included on the agenda for the forthcoming Cabinet meeting.

Mr Fowler then referred to a typo on page 31 of the agenda pack, 3^rd line down, the word ‘and’ should be changed to ‘are’, to read ‘As the contracts ‘are’ all long-term’. He then mentioned the Planning & Building Control contract that was due to end in 2024 and felt  ...  view the full minutes text for item 8/23

Report by Faye Haywood, Head of Internal Audit.

The Head of Internal Audit presented the report.

This was quite a lengthy report; however, some elements of it were just a formality; therefore, Members were guided through the high-level points and directed to the areas where their input and feedback was required. 

The introduction outlined the reason why the report was produced, and the Internal Audit Strategy and Charter were formal documents that Audit was required to provide to Members as part of the Public Sector Internal Audit Standards.  These went into great detail of how Internal Audit carried out their work that Members received annually and had not changed from previous versions. 

In October 2022, Eastern Internal Audit Services was fully assessed by the Chartered Institute of Internal Auditors and the conclusion of the review had been very good in terms of performance with the Standards.  It had been highlighted; however, that Assurance Mapping was as an area that required further development.  Following discussions with Senior Management, the Internal Audit Team had been able to map the types of assurance available for the top five strategic risks facing the Council in each of the three assurance categories (see section 6.5 and 6.6 on page 41 of the agenda pack).

Members attention was then drawn to page 54 of the agenda pack onwards.  This was a high level 3-year programme looking at the types of audits that should be carried out and the strategic risks had been mapped to those.

Referring to page 58 of the agenda pack, these were the areas that Internal Audit were proposing to look at for the year ahead - the number of days proposed to carry out this work and notes in terms of what might be looked at.  Members were asked for feedback on this section and if there were any areas that they had expected to see in next year’s programme that had not been included.

Councillor Clarke referred to the Internal Audit Plan 2023/24.  He agreed with Appendix 5 in respect of the top strategic risks and the fact that Nutrient Neutrality was a moving feast and would ultimately be resolved but in the commentary in Appendix 3 the column headed ‘last reviewed & assurance’ he felt that it would be helpful to have some explanation on how assurance was moved from ‘reasonable’ to ‘substantial’.

The Head of Internal Audit explained the methodology behind the 4 gradings, no assurance, limited, reasonable and substantial.  Substantial was the top grading, the meaning of which was that everything was operating effectively.

Councillor Kybird, the Vice-Chairman mentioned People & Governance that included Elections and asked what Audit would cover in respect of the photographic evidence that was now required to be able to vote in an Election.

Members were informed that the Election Team was extremely busy at the moment, and she had no intention of disturbing them and as this was a new element, assurance would be provided going forward.

Councillor Monument was puzzled by the dates in respect of the Internal Audit Charter for  ...  view the full minutes text for item 9/23

Report of Councillor Phil Cowen, Executive Member Finance, Revenues and Benefits.

Councillor Cowen, the Executive Member for Finance, Revenue & Benefits introduced the report. 

All information was contained in the background at section 1 of the report and was very important as it set out what the Council had to do in terms of preparing and producing this information.   Appendix A contained a summary of a number of activities.

Matthew Fernandez-Graham, the Accountancy Manager then provided more detail in respect of a couple of points contained within the report

As of the end of December 2022, the Council had just over £34m invested in cash with various counterparties and had made in 9 months, £340k in interest, better than the budgeted amount. This had been due to the increase in interest rates and the Council Tax rebate scheme. Members were informed that an error had been spotted by Councillor Monument when the agenda had been published, within the two tables on page 70 of the report, the correct figure on the top table under the budget 2022/23 in respect of the closing balance should read £2.182m   and again in the bottom table budget 2022/23 in the bottom two rows for CFR and Under/ (over) funding of CFR should read £2.182.

Councillor Birt drew attention to section 2.1 on page 68 of the agenda pack.  He was struggling to understand the two tables, firstly, the service investments, it seemed to him that the Council had made less than half of what it had planned, and if this was the case, which investments had not been and why, and had these been carried forward.

The Accountancy Manager explained that the service investments figure would be reported to Cabinet at its forthcoming meeting and was the position at the end of December 2022, there would be some carry forward requests and not all of the budget would have been spent by the end of the financial year.

The Chairman said that he believed this was called slippage and did not necessarily mean that they would not be delivered just not in this financial year.   The answer to the remainder of Councillor Birt’s question would be contained in the Cabinet report.

On page 79, Appendix B of the report, Councillor Birt had noticed a reference stating that currently 49% of investments had a maturity of less than one week and asked if it would be better to tie up the Council’s investments for a longer term and getting a better return on them rather than just for a week.  

Members were informed that this was just a coincidence, the Council did have long term investments and were due back in the first week of January 2023 so as at 31 December those investments had a maturity value of less than a week. 

As the interest rates were due to increase again, the Chairman felt that it was not a good idea to invest long-term at a set level. 

As there were no further questions, it was

RESOLVED that:

1.    the actual prudential indicators for April  ...  view the full minutes text for item 10/23

Report of Councillor Phil Cowen, Executive Member for Finance, Revenues & Benefits.

The Chairman pointed out that under this item there was an appendix that was private & confidential and if Members wished to discuss this in more detail, a vote would have to be taken to go below the line and would be taken as the last item on the agenda.

It was agreed that no discussion was required in terms of the private & confidential appendix and the meeting remained in public session.

The Executive Member for Finance, Revenue & Benefits introduced the report. This report was for Members to recommend to Full Council and it outlined the Council’s prudential indicators for 2023/24 and 2025/26.  Item 1 of the report provided the background and identified why the Council was doing this, why it had to do it and the procedures subsequently identified how the Council had gone about it.  He asked Members to note the key elements of the Prudential Code that had to be addressed and most importantly, at section 1.3, it confirmed that a balanced budget had to be produced.

The Accountancy Manager then presented the report.  The report contained relatively few changes since July 2022 when Members last considered the Treasury Management Policy and Strategy.

The main changes were highlighted.

The maximum amount that the Council could invest in secure counterparties for up to one year or more was currently £7.5m but was now being recommended that where these secure counterparties were non-UK banks, the Country limit set at £5m for all investments, should be raised to £7.5m to ensure consistency of investments.

The Council was still not expecting to borrow externally over this time period but borrowing internally would be required to fund the Capital Programme and would be repaid overtime.

The table on page 94 of the agenda pack that the returns on the Council’s investments for next year would be just over 6% in terms of the Council’s revenue stream due to the level of interest rates.

Attention was then drawn to page 99 of the agenda pack, where based on the estimates in the report and the 10 year capital programme, a liability benchmark had been developed to cover the next 10 years. The dotted red line was the key line to note as this was the liability benchmark which was negative for the next 10 years and the reason for this was that the investments were expected to exceed the Council’s external borrowing.

Mr Fowler, the Independent Lay Advisor referred to table 2 on page 90 of the agenda pack and asked why there was such a leap in the capital receipts and reserves column from this year to next.

Members were informed that the Council current had a major asset sale that was expected to happen at some point in 2023/24.  The Chairman stated that the key here was that this was only an estimate.

Councillor Birt referred to page 131 of the agenda pack, the interest rate forecast. He was aware that there had been some huge changes in this forecast compared to  ...  view the full minutes text for item 11/23

Report of the External Auditor.

Mark Hodgson, the External Auditor introduced the External Audit Plan for the 2021/22 financial year.  Overall, Ernst & Young were in a very good place with the audit and were looking to complete and sign the audit next week, this was due to the excellent support provided by the Officers in the Finance Team, and indeed the strength in the draft financial statements that had been presented for audit.   A few audit differences had been identified and at the time of the agenda publication, the auditors had not been in a position to issue a full audit result report but an audit progress report had been provided.

A detailed update on the major areas was then provided by Andrew Paylor, the Audit Manager in attendance.

The Vice-Chairman asked if all matters concerning the previous partnership with South Holland District Council now closed.

Members were informed that there were still some shared services, but these were significantly less.

Mr Fowler had noticed that there was a few references to outstanding information on page 149 of the agenda pack and that supporting documentation was still awaited.  He had also noticed that there was a long list of items on page 155 to 159 of the agenda pack that were still outstanding and asked the auditors if they were concerned.

Members were informed that dialogue in respect of such matters was still on-going, but he did not have any concerns.

Alison Chubbock, the Assistant Director of Finance advised that this was a list at a point in time, a good dialogue was still taking place and the information required was being provided in a timely manner.

Councillor Morton referred to the £1.6m due to Covid and how this would affect the accounting.  

The Audit Manager explained that there would  be no impact to the bottom line this would just show on the balance sheet.

Councillor Morton also asked a question about pension liability and whether the auditors felt that this was stable.

The Accountancy Manager advised that pension liability varied and went up and down every year.  This amount was the amount that authorities would have to pay out, but Norfolk County Council was a stable policy and this £1.6m was just a number at a point in time.

The Chairman advised that the pension fund was in the hands of others and was positive than previous years.

The External Audit Plan for 2021/22 was otherwise noted.

Report of Alison Chubbock, Assistant Director Finance (S151 Officer).

The Accountancy Manager presented the audited Statement of Accounts 2021/22.

Members were informed that the audit had progressed very well and the list of all changes made since July 2022 could be found at paragraph 1.3 of the report.  There was one additional change to be made and that was around covid related grants and infrastructure but most of the changes were only to note.

Councillor Birt was confused about the page numbers and referred to pages on either page 210 or 217 of the agenda pack under Note 15, Provisions (page 217) the outstanding legal cases budget provision.  He had noticed that the text was all about planning cases and asked if the provision was entirely for such matters or was there provision in there for other legal cases.

It was noted that all related to planning court cases at this point in time.

Mr Fowler referred to page 163 of the agenda pack and wondered how this authority managed to determine more applications than were received.

The Assistant Director of Finance said that this was a timing difference but she would check the numbers.

There were no further questions.

RESOLVED that subject to the finalisation of the audit of the accounts by Ernst & Young, the Governance and Audit Committee resolved as follows:

(a) to approve the financial statements of the Council as presented, having taken account of the External Auditors report. To authorise the Chairman of the Governance & Audit Committee to sign and date the financial statements, once the auditor has completed their outstanding procedures as described, on the basis that no material audit differences are identified. If those procedures identify any material audit difference, which would require a material adjustment to the financial statements, the Governance & Audit Committee would be notified and updated accordingly and a new motion to approve the revised financial statements made at the next available Governance & Audit Committee meeting.

(b) to approve the Annual Governance Statement 2021-22 as presented, having taken account of the External Auditors report. To authorise the Chief Executive and Leader to sign and date the Annual Governance Statement once the auditor has completed their outstanding procedures as described, on the basis that no material audit differences have been identified or are expected.

(c) to authorise the Chairman of the Governance & Audit Committee to approve the Letter of Representation 2021-22 once this is received.

Report of Alison Chubbock, Assistant Director Finance (S151 Officer).

The Accountancy Manager presented the report.

It was noted that a couple of changes were proposed to the accounting policies for this financial year, the appeals provision and surplus land – both were proposed to be removed and the reasons were explained.

Councillor Monument drew attention to page 276 of the agenda pack and referred to the wording above the yellow highlight where it said that ‘a de-minimis level of £20,000 has been adopted for the inclusion of non-current assets in all categories’ and felt that  the following yellow highlighted wording, ‘with the exception of’, that was marked for deletion should remain otherwise it did not make sense.

The Chairman agreed with the above amendment.

Councillor Birt asked who determined the de-minimis level.  Members were informed that it was this Committee

RESOLVED, that subject to the above amendment, the accounting policies for 2022-23 at Appendix A of the report be agreed.

Report of Rob Walker, Deputy Chief Executive & Monitoring Officer.

Sarah Wolstenholme-Smy, the Legal Services Manager presented the report.

Under the Localism Act all authorities were required to adopt a Code of Conduct.   The Council’s current arrangements had been adopted in March 2017 and the current Code was published as part 5 of the Constitution.

Following a review of the ethical framework for members, the Committee on Standards in Public Life (CSPL) recommended that there should be a national model Code of Conduct.  This recommendation had been passed to the LGA to progress and in 2020 the LGA released a draft Model for consultation.

There had been extensive consultations on the draft resulting in some changes and a finalised Model Code of Conduct had been released in May 2021.

The LGA model was more detailed than the Council’s own Code of Conduct (see paragraph 3.1 of the report), but it was not compulsory to adopt; however, it was being recommended that it should be adopted for a consistency approach across all Norfolk councils

The Chairman felt that this was very important as not only would it be used by Breckland Council but also by many Parish Councils who had adopted Breckland’s Code.  He also felt that it had been worth bringing this new Code forward now prior to the Elections in May for good governance.

The Vice-Chairman referred to Appendix B of the report that referred to the Joint Statement and asked who the parties were in this Statement.  The Legal Services Manager said that she would clarify that and report back accordingly.

The Vice-Chairman also noticed that the Model Code did not refer to pre-determination and contained very little in terms of data protection.  He also felt that it should include some form of guidance on appropriate Member training.

Councillor Clarke was pleased to see reference to the Seven Principles of Public Life, known as the Nolan Principles, being taken into account.  He was also pleased to see, under paragraph 1.2 of Appendix A of the report, that all Councillors must be committed to behaving in a manner consistent with the seven principles.  He then referred to the role of the Monitoring Officer, in terms of the Appeal process.

The Legal Services Manager explained that the Standards Committee had made recommendations to Government in terms of what powers the Monitoring Officer had, and the response was still awaited.

Councillor Birt had also noticed the omission of pre-determination. He did, however, support the adoption of this new Code of Conduct as he felt that this would be a significant improvement as to what the Council had now. He had on many occasions pointed out numerous flaws in the past in terms of Breckand’s interpretation of the Nolan Principles, and by adopting this, it would be up to date, and all would have to be truthful.  He then quoted a section from the Standards of Public Life that stated that ‘all people appointed to work in the Civil Service, Local Government’ which he believed should equally include Officers of the  ...  view the full minutes text for item 15/23

A copy of the Committee’s work programme is attached.  The Committee is asked to consider whether any additions, deletions or amendments to the programme are required.

The Work Programme was noted.

To note the arrangements for the next meeting on Thursday, 22 June 2023 at 10am in the Anglia Room.

The arrangements for the next meeting on Thursday, 22 June at 10am in the Anglia Room were noted.

Before the meeting closed, and as this was the last meeting before the Elections, the Chairman wanted to thank everyone for their support and help over the last 4 years.

The Vice-Chairman felt that as there could possibly be new Members, training should be specifically addressed.