Agenda and minutes

No apologies were received.

Members are asked to declare any interests in matters for consideration at the meeting.

No declarations of interest were received.

To approve the minutes of the meeting held on 8^th November 2011.

The minutes of the meeting held on 8^th November 2011 were confirmed as a correct record and the Chairman authorised to sign them.

No representations were received.

The Committee received a report of External Auditors, the Audit Commission, the purpose of which was to present to the Committee the regular progress report.

Ms Ironmonger of the Audit Commission was in attendance to speak to the report and she briefly outlined the main points for the consideration of the Committee, in particular she referred to the following:

(i)      That the 2010/11 accounts had now been signed off and work continued toward the same end for the 2011/12 accounts.  The first stage of this would be to send auditors on site and this was being organised by officers.

(ii)     A response to the 2010/11 letter would be needed from the Committee and this had been previously delegated to the Chairman in consultation with officers.

(iii)   That the report also included an update on the externalisation of the audit process

The Committee discussed the report following comments made and questions raised the following further information was received from officers:

(i)      That the online comparison tool referred to in the report was a relatively straightforward mechanism, which did allow comparisons between boroughs. Boroughs selected would be those from the same ‘family’ ie having similar demographics.

(ii)    That although this tool had not been utilised at Richmond Data matching had taken place

It was RESOLVED:

1.                  That the Chairman and Vice Chairman respond to the Audit Commission letter on behalf of the committee and the response be reported to the next committee.

2.                  That the information in the report be NOTED.

The Committee received a report of the external auditors, The Audit Commission. Ms Ironmonger was in attendance to speak to the report and in particular she referred the committee to the following information:

(i)      That the cost of the certification work for 2010/11 was £44,422

(ii)    That one recommendation was made in relation to school employee pension returns and the standardisation of figures

(iii)   That the fees charged were lower this year than in previous years as no in depth investigations had been warranted by the initial sample cases. These initial samples were normally 60 in number in the first instance. The lack of concern arising from these samples was to be congratulated as it was unusual.

It was RESOLVED:

1. That the reports be NOTED.

To receive a report presenting the Treasury Management Strategy, the Treasury Management Policy and the Approved Investment Criteria 2012/13.  This report is presented for review and comment, and seeks endorsement of the document for before it is considered by cabinet and Council.

The Committee received a report of the Resources the purpose of which was to present the key Treasury Management documents for 2012/13 namely the Treasury Management Strategy, the Treasury Management Policy and the Approved Investment Criteria. The report sought the views of the committee before consideration by Cabinet and adoption by Council.

The Head of Capital Finance was in attendance to speak to the report and in particular the committee was directed to the following information:

(i)      That the background to this review was the economic climate and the loss of confidence in the market and the avoidance of risk in investment.

(ii)    That timing of borrowing had also proved an increased risk in this climate. At present internal borrowing was being undertaken in order to fund cash flow; at some point external borrowing would be restored. The timing of this was important as the authority was mindful not to wait too long and miss out on low cost borrowing.

(iii)   Government investments and lending were seen as low risk because there was an assumption that the government would not allow any local authority to fail; in fact this assumption was couched in legislation.

The Committee discussed the report and following comments made and questions raised the committee received the following additional information from Officers:

(i)      That the local authority would reassess its investments in banks part owned by the Government should Government shares be sold but generally a deposit would be allowed to run to its full term.

(ii)    That occasionally an organisation in which the authority was invested would fall below the rating level we would normally require for investment. These were monitored closely and action taken where necessary, these actions were reported to the committee but not where changes had not occurred.

(iii)   That although there was a small spike in debt repayments in 2032 it was not considered to be a potential issue. In comparison to other authorities it was not unduly high.

(iv)  That Building Societies, despite the general assumption that the larger ones would not be allowed by the Government to go out of existence, were not considered to be a safe investment until that assumption was confirmed.

It was RESOLVED:

That the report be NOTED.

To receive a report providing information on the potential risks to the Council arising from the Olympic and Paralympics Games, particularly from the events which directly impact on the Borough and to consider how these risks are being addressed.

The Committee received a report of the Director of Environment, the purpose of which was to facilitate consideration of the potential risks to the Council arising from the Olympic and Paralympics Games, particularly from those events which directly impact on the Borough.

The Director of Environment was in attendance to speak to the report and he referred the committee to the following pertinent information:

(i)      Potential risks to essential Council services from travel congestion and crowd control.

(ii)    Potential risk of hostile acts being carried out

(iii)   Potential reputational risks if the impact on residents, businesses and visitors was not effectively managed

(iv)  Potential financial risks.

(v)    That these risks were being managed through governance arrangements put in place for the occasion; learning from the London-Surrey Classic; regular representation at operational meetings with LOCOG/TfL, utilisation of guidance and checklists, multi-agency resilience exercises and a comprehensive Communications Plan.

(vi)  That the Environment Overview and Scrutiny Committee had been monitoring the risk management needs that resulted from the trial and road race events.

(vii) A Project Manager for the Olympics had now been appointed, former Borough Commander, Rick Turner, and part of his responsibility would be to highlight and mitigate risks identified internally as well as the adequacy or otherwise of the planning provision in other organisations.

The Committee discussed the following themes, and in response to questions raised and comments made the Committee heard the following additional information from officers:

(i)      That the two biggest risks were likely to be communications with the public, and between the various organisations involved.

(ii)    Resources and the fair and equal distribution of costs were discussed.

(iii)   That the numbers expected to arrive in the Borough for the road race was unknown and past events were difficult to compare but members of LOCOG who had experience of the Sydney Olympics were using all relevant information to attempt to establish a realistic estimate.

(iv)  That more detail of the timing of the events themselves was needed.

(v)    That TFL would have some responsibility for the route itself but not to those other areas where residents may choose to visit.

(vi)  That diversion routes for cyclists would be considered and may be put in place in cases of emergency.

(vii) That holiday cover for staff in the environment directorate was being closely monitored and managed by the Director through his Management Team.

(viii)                       That responsibility for “cleansing” the race route of unauthorised advertising would lie with LOCOG.

(ix)  That road works for the race route were in the main being undertaken by the Council at TfL cost. However in places LBRuT would fund works, for example, where it was necessary by our own required standards.

It was RESOLVED that the information received be NOTED.

To receive a report containing details of the Council’s Transformation and Commissioning programme, the risks that have been identified with its successful implementation and the measures in place to mitigate them in order to deliver the programmes objectives.

The Committee received a report of the Assistant Director of Finance and Corporate Resources and Assistant Director Commissioning Corporate Policy and Strategy the purpose of which was to provide details of the Council’s Transformation and Commissioning programme, the risks that had been identified with its successful implementation and the measures in place to mitigate them.

The Assistant Director of Finance and Corporate Services was in attendance to speak to the report, he briefly introduced the report and explained that it provided a high level strategic view of the programme on which the committee could base questions for officers.

The Committee discussed the information in the report and following questions raised and comments made the committee received further information from officers:

(i)      The VAT issue for certain of the delivery vehicles proposed was related to the nature of the services supplied and the inability of the vehicle to then claim VAT back. With regard to business rates and the loss of benefits currently enjoyed by Local Authorities, officers believed that this was an unintentional consequence of recent government changes and an approach had been made to government to this effect. No response had been received as yet.

(ii)    That there were some capacity issues ongoing at present. In particular employing and keeping staff in procurement was difficult.

It was RESOLVED that the report be NOTED.

To receive a report providing an update on the proposal to develop a shared service with the Royal Borough of Kingston (RBK) for the delivery of an Internal Audit and Investigations service (IAIS).

 The Committee received a report of the Joint Heads of Internal Audit and Risk Management, the purpose of which was to provide an update on the proposal to develop a shared service with the Royal Borough of Kingston for the delivery of Internal Audit and Investigations services.

The Joint Heads of Service were in attendance to speak to the report and briefly reminded the committee of the key factors in the shared service process, namely:

(i)      That the Joint Heads of Internal Audit and Risk Management were now located at Kingston on a part time secondment basis managing both teams whilst the business case for a permanent shared service arrangement was being developed.

(ii)     That Cabinet was expected to consider and reach a decision on the full business case in March

The Committee was offered the opportunity to see the full business case at an extraordinary meeting.

The committee discussed the contents of the report and from this discussion made the following comments:

(i)      That the use of 2.5days and 0.5 fte be standardised within the report.

(ii)    That the Chairman and Vice Chairman should consider and comment on the full business plan on behalf of the Committee in order that an extraordinary meeting need not be called.

It was RESOLVED

1.                  That authority be delegated to the Chairman and Vice Chairman to meet with officers and comment on the Business case prior to its consideration by Cabinet.

2.                  That having regard for the comments above and resolution at 1. the report be NOTED.