Agenda and minutes

To note the attendance at this meeting of any duly appointed Reserve Members.

Reserve Members may attend meetings:-

(i)                 to take the place of an ordinary Member for whom they are a reserve;

(ii)               where the ordinary Member will be absent for the whole of the meeting; and

(iii)             the meeting notes at the start of the meeting at the item ‘Reserves’ that the Reserve Member is or will be attending as a reserve;

(iv)              if a Reserve Member whose intention to attend has been noted arrives after the commencement of the meeting, then that Reserve Member can only act as a Member from the start of the next item of business on the agenda after his/her arrival.

RESOLVED:  To note the attendance at this meeting of the following duly appointed Reserve Member:-

To receive declarations of personal or prejudicial interests, arising from business to be transacted at this meeting, from:

(a)               all Members of the Committee;

(b)               all other Members present.

RESOLVED:  To note that the following interests were declared:

Agenda Item 9 – Final Accounts

Councillor Sue Anderson declared a personal interest in that she was employed by Her Majesty’s Revenue and Customs (HMRC).  She would remain in the room whilst the matter was considered and voted upon.

That the minutes of the meeting held on 6 September 2011 be taken as read and signed as a correct record.

Members noted that the minutes of the meeting were circulated on a main agenda due to the close proximity of this meeting.  The Committee agreed to receive the minutes as an urgent item for the reasons stated on the supplemental agenda.

RESOLVED:  That the minutes of the meeting held on 6 September 2011, be taken as read and signed as a correct record.

To receive questions (if any) from local residents/organisations under the provisions of Committee Procedure Rule 17 (Part 4B of the Constitution).

RESOLVED:  To note that no public questions were put, or petitions or deputations received at this meeting.

To receive references from Council and any other Committees or Panels (if any).

None received.

Report of the Director of Legal & Governance Services.

The Committee received a report of the Director of Legal and Governance Services that outlined the main provisions of the Bribery Act 2010 and the steps that officers had identified would be necessary for its implementation within the Council.

An officer reported that:

·                     the Bribery Act 2010 came into force on 1 July 3011 and replaced, updated and extended the existing laws against corruption;

·                     the Act created four new offences, including:

·                     offences of Bribing another Person (Section 1) occurred where an individual was offered, promised or given financial reward (or been led to believe) and it induced them to perform an improper function or act;

·                     failure of Commercial Organisation to prevent bribery (Section 7) occurred when a commercial organisation failed to prevent a bribe being paid for or on its behalf.  In general, a commercial organisation would not include a public body, however, the Council may have subsidiaries which could fall within the scope of the Act or conduct its affairs in a manner akin to a private business.  The Council had considered the guidance published by the Ministry of Justice on Section 7 of the Act when implementing and updating procedures to prevent bribery.

In response to questions from the Committee, the officer advised that bona fide hospitality that sought to improve the image of a commercial organisation would not be prohibited as long as it was proportionate in accordance with the guidance.

RESOLVED:  That the report be noted.

Report of the Interim Director Finance.

The Committee agreed to receive a report on the Final Accounts as an urgent item for the reasons stated on the supplemental agenda.  The Committee received a report of the Interim Director of Finance which set out the Council’s audited Statement of Accounts for 2010/11.  An officer reported that:

·                     the 2010/11 accounts had been prepared in full accordance with the International Financial Standards (IFRS) for the first time.  Officers were required to ensure that account balances for 2009/10 and 2008/09 were restated in accordance with the Statement of Recommended Practice (SORP);

·                     the production and approval of the accounts was an important process as it enabled stakeholders to review the Council’s financial position for the year ended 31 March 2011;

·                     the draft statement of accounts was signed by the Interim Director of Finance in her capacity as the Chief Financial Officer on 30 June 2011.  The external audit of the accounts had began on 4 July 2011.  Members of the Committee had met with the External Auditors, Deloitte LLP, before the Governance, Audit and Risk Management (GARM) Committee meeting on 6 September 2011 when the draft final accounts had been considered.  A pre-meeting briefing on the final accounts also took place and Senior Officers within the Finance Team had had the opportunity to respond to Members queries in relation to the content of the draft accounts.  The Council was on target for signing off the accounts by the statutory deadline of 30 September 2011 as required by the Accounts and Audit Regulations 2011.

Representatives from Deloitte LLP, advised the Committee that:

·                     the process for preparing the Final Accounts had gone smoothly and the transition to the IFRS had been undertaken with due care.  There were fewer matters arising than in previous years.  Some minor areas that had been highlighted had been noted and corrected;

·                     the Council’s valuation of the pension scheme liabilities was reasonable;

·                     the Auditors were comfortable with the approach and assumptions made in relation to the Council’s property valuations;

·                     the Auditors had recognised some minor errors in the Council’s presumed risk of fraud in relation to revenue recognition.  These had been addressed by Management and the Auditors were satisfied with the approach taken;

·                     following amendments to auditing standards which were highlighted by the auditors, no significant weaknesses in relation to the control environment had been identified.  Nevertheless, to enhance existing processes, the Auditors had made recommendations that would improve the Council’s control environment;

·                     ongoing improvements to the control environment and the testing of in?year capital transactions undertaken by the Directorates and evaluated by Internal Audit had been reviewed.  The external Auditors were satisfied that the matter had been effectively addressed and mis?coding within the accounts had not occurred;

·                     the external Auditors procedures for the Whole of Government Accounts was ongoing.  It was anticipated that the audited return on the Council’s accounts would be returned by 30 September 2011;

·                     there was an unadjusted misstatement in relation to a potential over-provision against debtors.  Management had concluded that the total  ...  view the full minutes text for item 120.

Report of the Assistant Chief Executive.

An officer presented a report of the Assistant Chief Executive which set out the Council’s current insurance arrangements, including self-funding, and provided information on the main insurable risks faced by the Council.

The officer outlined key information contained in the report and advised the Committee that:

·                     the insurance service comprised a team of four officers, who sought to deliver an efficient, economic and high quality service that met customers needs, corporate priorities and statutory requirements;

·                     the main aims and areas of responsibility of the service included providing a comprehensive insurance and claims handling service to internal and external customers, as well as advising the Council on all insurance matters.  Officers within the insurance team worked in partnership with all departments to manage and reduce the council’s exposure to insurable risk;

·                     all claims against the Council were managed by the council’s in-house team with the exception of personal injury claims, which were handled by external claims handlers, Cunningham Lindsey;

·                     Harrow Council was a member of the Insurance London Consortium (ILC).  The ILC was established in 2009 following the demise of the London Authorities Mutual Ltd that was comprised of nine London Boroughs.  The purpose of the consortium was to reduce costs by combining purchasing power and making best practice improvements to internal systems that would enhance efficiencies.  Membership of the consortium had delivered savings on insurance premiums in 2011/12 of £110,000 for the Council.  In addition to the financial savings, consortium members also benefited from enhanced policy cover which was specifically tailored to the requirements of the ILC and embarked upon a number of initiatives to manage and reduce insurable risk;

·                     most of the Council’s external insurance polices were subject to large policy excesses.  The level of excess was set on a prudent basis in line with similar local authorities and recognised best practice.  Claims that fell within the policy excesses were met from the Council’s insurance provisions and were handled on similar terms and conditions as external policies.  The Council’s maximum financial liability under each class of business was capped by an annual stop loss aggregate which outlined a maximum exposure level in any one policy year;

·                     the Council’s insurance provisions were subject to an independent actuarial review, which took place every three years.  A mini-review had been due in 2009 and as at 31 March 2010, the fund was deemed to be adequate at £5.1 million;

·                     the total number of claims against the Council had peaked in the 2006/07 policy year.  Claim numbers had fallen and had remained static since the 2007/08 policy year.  This correlated with a fall in the total number of payments made from the Council’s funds which fell from £1.83 million in 2009/10 to £1.08 million on 2010/11;

·                     public liability claims accounted for 49% of all claims received.  13% of these claims relate to tree subsidence (for privately owned properties) which was 44% of insurance payments made by the Council.  Nevertheless, the majority of claims made against the Council were successfully repudiated.

Members thanked the  ...  view the full minutes text for item 121.

Which cannot otherwise be dealt with.

Lead Member Update

This item was considered to be urgent to provide Members with an update on the nominations and appointment of Lead Members for the GARM Committee.

An officer reported that nominations had been received for some service areas.  Members were invited to volunteer as a Lead Member for each of Corporate Governance, Risk Management, Internal Audit, Insurance and General Finance.  He added that a follow up letter would be sent to all Members and Reserves of the GARM Committee towards the end of the month.

Vote of Thanks

The Chairman advised that this was potentially the last meeting of the Clerk to the Committee as she had been offered a new role in the Legal Practice Team.  Members and officers present thanked her for all the work and support that she had provided to the Committee over the past two years and wished her all the best in her future career.