Agenda and minutes

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

RESOLVED:  To note that there were no Reserve Members in attendance.

To receive declarations of disclosable pecuniary or non pecuniary interests, arising from business to be transacted at this meeting, from all Members present.

RESOLVED:  To note that Councillor Dan Anderson declared a non-pecuniary interest on page 134 of the risk register which referenced trade unions as heis a Member of the GMB Union.

That the minutes of the meeting held on 19 March 2024 be taken as read and signed as a correct record.

RESOLVED:  That the minutes of the meeting held on 19 March 2024, be taken as read and signed as a correct record.

To note any public questions received.

Questions will be asked in the order in which they were received.  There will be a time limit of 15 minutes for the asking and answering of public questions.

[The deadline for receipt of public questions is 3.00 pm, Wednesday 10 July 2024.  Questions should be sent to publicquestions@harrow.gov.uk  

No person may submit more than one question].

RESOLVED:  To note that no public questions were received.

To receive petitions (if any) submitted by members of the public/Councillors.

RESOLVED:  To note that no petitions had been received.

To receive deputations (if any).

RESOLVED:  To note that no deputations had been received.

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

RESOLVED:  To note that no references were received.

To consider the appointment of a Vice-Chair to the Governance, Audit, Risk Management and Standards Committee for the Municipal Year 2024-2025.

RESOLVED:  To appoint Councillor Ghazanfar Ali as Vice-Chair of the Governance, Audit, Risk Management and Standards Committee for the 2024/2025 Municipal Year.

Report of the Director of Finance & Assurance

The Committee received a report which provided an update on the progressof the 2022/23 external audit and received information on the audit planfor 2023/24.

The report was introduced by the Director of Finance and Assurance who reminded Members that there had been a national delay in the sign of off the audit.  Harrow’s 2021/2022 audit was signed off in November 2023 which pitched it well against other London Borough’s.

Members were informed that the audit backstop that was previouslydiscussed at the last meeting had been put on hold due to the timing of the General Election.

Members were advised that the main issue with the 2022/2023 audit was the balance sheets of the audit of some of the Council’s assets; however, there wereno significantweaknesses identifiedwithin theValue formoney progress report.

Members were given the opportunity to ask questions and in response it was clarified that:

-                 The Councilhad usedan externalcompany tocarry outthe valuationof its land and these were valued at a higher end which was inconsistent with what the Council and other Council’s normally do and this caused an issue for the external auditors.  Members were however informed that this valuation was in the process of going down.

-                 There had been an improvement in the engagement and communication between the Council and the external auditors to identify and resolve any issues.

The external auditors were then invited to present appendix 1,2 and 3.  Members wereinformed thatthe 3weaknesses onthe valuefor moneyfor the previous audit were no longer an issue for the current audit.

Members were given the opportunity to ask questions of the external auditors and it was clarified that:

-                 The Fees for the audit had risen for 2023-2024 due to the public sector procurement exercise that the Council had undertaken.

-                 The risk of data transfer with the Council’s new financial system related to the 2021/2022 audit and not the 2022/2023 audit.

-                 Due to the general election, the proposed backstop did not get through Parliament.  The understanding is that the new government would liketo continue with the backstep; however, the date of this was still to be confirmed by Central Government.

-                 The Final fees had not yet been firmed up as the audits were minded to get to a position whereby the audit was close to completion; however it was confirmed that the final fees would be in line with the ranges quoted.  In response to this a member raised the point that they would like to have the final fees for the 2023/2024 audit confirmed as soon as possible.

-                 The timescalesfor completingthe 2023/2024audit werestill ontrack.

-                 Due to the backlog, it was expected that the 2023/2024 audit would not look dissimilar to the 2022/2023 audit; however it was expected that that the 2024/2025 audit would be significant progress.

A Member raised their desire to receive an update from the  ...  view the full minutes text for item 128.

Report of the Director of Finance & Assurance

The Committee received a report which set out the Council’s corporate risk register as of June 2024.

Particularly attention was drawn to page 117 of the report which set out the main risks which were currently being experienced by the Council.

Members were given the opportunity to ask questions of the report and in response it was clarified that:

-                 The Council had a number of technical features in place to prevent against potential cyber security attacks.

-                 There were2 newmitigations introducedagainst thenew cybersecurity risk and this related to adopting a London wide framework for cyber security incident response and a London wide supplier framework checklist.

-                 An annual information governance program and regular phishing exercises were undertaken to provide further training for those who fall victim to such exercises.

-                 The risk of cyber security threats had risen over the years and today’s methods are now more sophisticated.

-                 Customer data between the Council and its suppliers were encrypted as a mitigation against cyber-attacks.

-                 The Corporate Leadership team would regularly meet to analyse the Council’s risk register.  This team comprised of the most senior Officers within the Council.  The team would identify which of the risks that they were significantly concerned about and would allocate such resources to put in mitigations against the risk.

A Member raised their desire for the Committee to receive a further update at a later date on how the Council was intending to prepare itself against future cyber security attacks.  It was confirmed that this would be looked into.

A Member raised a query regarding the Council’s level of insurance against health and safety incidents and it was confirmed that this would be looked into.

RESOLVED:  That the Information Report – Q1 Corporate Risk Register 2024/25 be noted.

Report of the Director of Finance and Assurance

The Committee received a report which was to go to Full Council in September which set out the work undertaken by the GARMS Committee during 2023/2024.

Members were informed that this report was produced in line with the Committee’s Terms of Reference which requires the committee to:

1)              report to those charged with governance on the committee’s findings, conclusions and recommendations concerning the adequacy and effectiveness of their governance, risk management and internal control frameworks, financial reporting arrangements, and internal and external audit functions.

2)              report to full Council on an annual basis on the committee’s performance in relation to the terms of reference and the effectiveness of the committee in meeting its purpose.

3)              publish anannual reporton thework ofthe committee.

With the exception of the Health and Safety, all of the other functions of the Committee had been undertaken.

RESOLVED:  That

(1)            the draftreport attachedat Appendix1 beconsidered;

(2)            no comments/ changeswere requiredto thereport;

(3)            the reportto bepresented toCouncil on26 September2024.

Report of the Director of Finance and Assurance

The Committee received a report which set out the annual governance process and the 2023/24 Draft Annual Governance Statement (AGS) along with the final 2022/23 AGS published with the draft 2022/23 accounts.

As part of this review, Members were informed that the Local Code of Corporate Governance was also required to be reviewed as this had not been done since 2014.

Members were given the opportunity to ask questions of the report and in response it was clarified that:

-                 The risk register is a live document; whereas the annual governance statement refers to things that took place during a specific time period and therefore the risk register was more up to date and reflective of the risks.

RESOLVED:  That

(1)            the draft 2023/24 Annual Governance Statement at Appendix 1 be  noted;

(2)            the draft 2022/23 Annual Governance Statement at Appendix 2 be noted;

(3)            the Local Code of Corporate Governance Review be noted.

Report of the Director of Finance and Assurance.

The Committee received a report of the Director of Finance and Assurance which set out the 2024/25 Internal Audit Annual Plan and the reviewedInternal Audit Charter.

The Head of Internal Audit and Corporate – Anti Fraud introduced the report and informed Members that the report was due to go the Committee in April but was delayed due to the cancellation of the meeting. It was noted that the plan had already began being put in place.

RESOLVED: That

(1)            the Committee notes the Internal Audit Annual Plan 2024/25 and approves the internal Audit Charter 2024/25 in accordance with the Public Sector Internal Audit Standard 2020 Communication and Approval.;

(2)            the Committee notes the annual plan process, the Internal Audit Strategy, the service’s organisational independence, the resources available to complete the plan, audit techniques to be used and other sources of assurance.

Report of the Director of Finance and Assurance

The Committee received a report which set out the 2024-25 Corporate Anti-Fraud Plan.

Members were informed that the plan had been developed by taking into account both internal and external factors that assess fraud risks according to their likelihood and impact.

In responseto questionsfrom Membersit wasclarified that:

-                 There was always a risk when the plan becomes proactive, and a risk assessment was required to assess how to put the plan into practice to balance the resources of the CAFT Team.

-                 Additional screening checks for new employees were planned to assess whether there were any previous fraud incidents reported against individuals.

RESOLVED:  That

(1)            the Committeeapproves theCorporate Anti-FraudPlan 2024-2025;

(2)            the Committee notes the annual plan process, the plan development process and the resources available to complete the plan.

Report of the Director of Finance and Assurance

The Committee received a report which set out the 2023/24 year-end report for Internal Audit and included the Head of Internal Audit’s overall audit opinion on the control environment.

Members were informed that Internal Audit had achieved 93% of the 2023/24 internal audit annual plan which met the target of 90%.  A total of 124 recommendations were made to management to improve internal controls of which 100% were agreed for implementation exceeding the 95% target.

In response to questions from Members, it was clarified that:

-                 The plan was a rolling document and often evolved throughout the year with things either added or removed as required.

RESOLVED:  That the report and the appendix be considered and its contents be noted.

Report of the Director of Finance and Assurance

The Committee received a report which set out the performance of the Corporate Anti-Fraud Team in 2023/24.

Members were informed that of the 13 work streams contained within the plan, 11 (85%) were achieved, 1 (8%) was ongoing and 1 (8%) was not achieved and carried over to 2024-25.  In terms of the team’s key performance indicators; 4 of the 5 were achieved.

In response to questions from Members it was clarified that:

-                 The Hub intranet pages were seen by internal staff and the website was visible to residents which provided information on how to report a fraud case.

-                 The fraud e-learning course was mandatory for all staff to undertake.

RESOLVED:  The report and the appendix be considered and its contents be noted.

Report of the Director of Finance and Assurance

The Committee received a report which set out the Council’s Treasury Management Outturn position for 2023/24.

An Officer introduced the report and informed Members that the Treasury Management Outurn report was produced in line with CIPFA Code of Practice on Treasury Management, and the CIPFA Prudential Code for CapitalFinance along with meeting the requirements of the Council’s Financial Regulations.

Particular emphasis was drawn to page 269 of the report which highlighted a total capital expenditure of £64.218 million.  Members were informed that this was made up of £37.696 million of external borrowing and £26.523 million of unfinanced capital at the end of the year.

Members wereinformed thatno additionalexternal borrowingwas undertaken during2023/24 andthe Councilmaintained aninternal borrowingstrategy the same as the last couple of years.

It was explained that the Council had approximately £74 million in total investments at the end of the year which was invested through the debt management office as well as some money market funds.

A Member queried why some operating leases were being classified as Finance Leases.  The officer confirmed that this would sometimes be the case as legislation requires that the Council was only required to classify finance leases.

A Member questioned whether slippage meant that the Council was not using its capital finance requirements and queried whether in such instances there would be a recommendation to scale back the budget.  It was confirmed that this was not necessarily the case, and the level of slippage was difficult to predict during capital expenditure and this was a position that was common across other Local Authorities.

RESOLVED:  That

(1)            the TreasuryManagement outturnposition for2023/24 benoted;

(2)            the reportbe referredto Cabinetfor noting.