Finance, Resources, Audit and Governance Committee 25 July 2014 Agenda Item No. 8 EY Local Government Audit Committee Briefing Debbie Lorimer The report details how the Council is responding to a number of areas identified by EY (Ernst & Young) as areas that Audit Committees should be focussing on. The report produced by EY is attached in Appendix A. Cabinet member(s): Ward(s) affected: Garry Wheatley All Contact Officer, telephone number, and e-mail: Debbie Lorimer 01508 533981 [email protected] 1. Background 1.1. EY have produced a Local Government Audit Committee Briefing for Members which is attached as Appendix A. This Briefing covers a number of areas and suggests five questions that the Audit Committee should be asking itself about the areas covered in the paper. This report provides Members with an update on how the Council is responding to those questions. 2. Q uestions 2.1. Question 1 What impact will the introduction of the SFIS have on our capacity and expertise to tackle other areas of fraud risk, such as Council Tax, Business rates, Housing and other corporate Fraud? The Council has identified 1 FTE which will be transferring to the DWP under SFIS from August 2015. In response the Council has been lobbying MP’s that this transfer of resource will impact the level of fraud work carried out in other areas by the Council. Currently when investigating a Housing Benefit fraud the team will also successfully investigate other frauds such as council tax support at the same time. Following the transfer to SFIS Councils will no longer be able to do so and the Council will be left with approx. 0.5 FTE to cover fraud. However the Government recently announced a £16 million fund, for Councils to bid for. This funding will give councils 2 years of support to tackle non-benefit related fraud, such as Council Tax fraud, Housing fraud and theft of grants. Successful bids must demonstrate an innovative approach to tackling fraud, encompassing detection, prevention and deterrence from genuine additional activities to achieve financial savings through counter fraud activities. All bids will be judged against the potential financial savings and benefits on offer, as well as additional criteria Finance, Resources, Audit and Governance Committee 25 July 2014 such as partnership working, sustainability, feasibility and innovation. South Norfolk Council is proposing to submit a bid by the deadline of 5 September. 2.2. Question 2 Is there scope for us to take advantage of further opportunities for efficiency savings resulting from joint working with other public sector bodies? Yes there is scope for the Council to achieve efficiency savings through joint working and this is being progressed through the Early Help Hub where it is anticipated that efficiencies will come from reducing duplication of work between the public sector bodies. Another example would be the regional building control model where the Council is replicating the successful CNC model in each County in the East of England. CNC has achieved many efficiency savings while increasing resilience and offering an improved service. 2.3. Question 3 Where joint working arrangements are already in place, are they still fit for purpose or do we need to consider modifying the arrangements in line with our changing challenges and priorities? This Council continues to reflect on its joint working arrangements as the opportunity arises. The change of governance arrangements around CNC was championed by South Norfolk Council which has led to SNC having delegated authority to supply the building control service to three different Local Authorities. Another example would be the Internal Audit Consortium where the requirement to tender for a new contract provider led to a review of the service and influenced the current tender. 2.4. Question 4 What level of governance does our organisation have around contract management and delivery with both our public and private sector partners? Unlike many other local authorities this Council delivers most of its services inhouse and there is not as much reliance on the performance of external providers. However where contracts are in place the Council provides guidance in its Contract Standing Orders on contract management. Where contracts exist with other public bodies and the third sector these are often in the form of Service Level Agreements (SLA). There is a programme for reviewing these SLA’s and all contracts are monitored. 2.5. Question 5 How can we work with our audit engagement team to improve audit quality? The FRAG Committee already provides support to the internal audit team management and has previously reviewed the contract KPI’s. Looking forward the current tender process of utilising the dialogue method to engage the prospective bidders has assisted in ensuring the Council receive value for money Finance, Resources, Audit and Governance Committee 25 July 2014 both in terms of cost but also around first time quality. There have been discussions around the supplier’s processes in place to ensure first time quality and the outcomes from these discussions will be included within the Internal Audit Contract and monitored on a regularly basis through the KPIs. 3. Relevant Corporate Priorities 3.1. All 4. Implications and Risks 4.1. Financial and reputational (included elsewhere in the report). 5. Conclusion 5.1. The Council has controls in place to deal with the risks identified by EY in its report. 6. Recommendations or Action Required 6.1. Committee is requested to note the report from EY.
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