Agenda and minutes

Governance and Audit Committee - Wednesday, 8th June, 2022 2.00 pm

Venue: Council Chamber - Council Offices, St. Peter's Hill, Grantham. NG31 6PZ

Contact: Email: 

No. Item


Apologies for absence

    • Share this item


    Apologies for absence were received from Councillors’ Dixon-Warren and Woolley.


Disclosure of interests

    • Share this item

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


    No interests were disclosed.


Minutes of the meeting held on 20 April 2022 pdf icon PDF 133 KB

    • Share this item


    The minutes of the meeting held on 20 April 2022 were proposed, seconded and AGREED as a correct record subject to the removal of the duplication of the Chairman, Councillor Paul Wood in the attendance list.


Updates from previous meeting pdf icon PDF 31 KB

    • Share this item

    To consider updates on Actions agreed at the meeting held on 20 April 2022.


    A question was asked about whether the Scrutiny Review undertaken the previous year was part of the Delivering Good Governance External Review, it was stated that this was a separate issue.





Counter Fraud Annual Report pdf icon PDF 313 KB

    • Share this item

    As part of the Committee’s terms of reference, it is required to monitor and review the counter fraud arrangements in place and the activities that are being undertaken to mitigate those risks. 


    The Chief Finance Officer presented the Counter Fraud Annual Report for the year 2021/22.  The overarching framework had been updated and agreed by the Committee in January 2022.  The framework included the following:


    ·       Counter Fraud Strategy,

    ·       Counter Fraud and Anti-Corruption Policy

    ·       Whistleblowing Policy

    ·       Fraud Response Plan

    ·       Anti-Money Laundering Policy


    The Chief Finance Officer drew Member’s attention to the Whistleblowing part of the report.  The Confidential Reporting Line was managed on behalf of all the districts by the Lincolnshire Counter Fraud Partnership.  Some Districts promoted it heavily through their website such as South Kesteven, whilst other Districts had their own local arrangements and this was reflected in the volumes that went through the confidential Reporting Line as different districts had different routes for Whistleblowing.  It was noted that there was a reduction in calls by about a third on the previous year for South Kesteven. 


    All referrals went directly to the Governance and Risk Officer as part of her role and were dealt with accordingly, based on the information provided.  Member attention was drawn to paragraph 4.5 of the report which gave a breakdown of the type of allegations received for South Kesteven for 2021/22.  As a housing authority 41% of allegations were in relation to housing stock, this did not apply to districts such as East Lindsey and Boston as they did not hold housing stock and highlighted some of the discrepancies between the figures reported.


    Reference was then made to the fuel theft which had received a lot of media coverage.  Whilst the Police investigation had taken place the Council had been asked not to discuss the matter in public.  Following the conclusion of the police investigation a summary of the allegation, the investigation and actions implemented were detailed in the report. Seven actions had been implemented as a result of the whistleblowing investigation, where the internal framework had failed and the mitigations that had been put in place and the lessons that had been learnt from the incident.  These were highlighted and detailed within the report together with the financial penalty given to the individual.


    The other piece of work that the Council participated in was the Lincolnshire Counter Fraud Partnership (LCFP) which was hosted by Lincolnshire County Council. All Lincolnshire District authorities gave a financial contribution to the partnership which oversaw and jointly collaborated with all the districts in Lincolnshire to share good practice, and share resources on counter fraud initiatives. 


    The area that the LCPF had most input into was the review of the single person discount in respect of Council Tax liability which gave a 25% financial reduction in Council Tax.  It was a self-declaration which could be exposed to potential fraud where people made a declaration which was not appropriate.  A review of the single person discount was carried out regularly across Lincolnshire which had a financial advantage to all partners, particularly the County Council who were in receipt of nearly 80% of the Council Tax liability.  Different types of Information were joined up  ...  view the full minutes text for item 5.


Risk Management Annual Report pdf icon PDF 249 KB

    • Share this item

    In accordance with the terms of reference of the Committee, it is a requirement to produce an annual report on the risk management and business continuity arrangements in place.


    The Chief Finance Officer presented the annual report on Risk Management for the period 2021/22.  Risk Management was an integral part of the Committee’s terms of reference and the overarching risk management framework.  The Committee had revised and approved the current risk management framework at its meeting on 9 June 2021.


    The Risk Management Group was chaired by the Governance and Risk Officer and consisted of all the Heads of Service and Assistant Directors. The Group compiled a work plan around some of the main risks and interventions around risk management, internal audit, insurance, counter fraud governance, procurement, data protection, health and safety, business continuity and safeguarding. 


    Going forward the Risk Management Group would be scheduled as part of the Senior Leadership Team and meetings would be held quarterly with focus on one specific area and updates on other areas as applicable.


    Service Risk were risks that sat within operational service areas rather than strategic risk and these were currently being reviewed by the Governance and Risk Officer with Heads of Service following the completion of service plans.  Risks identified by the service area which would compromise service delivery and mitigations to address those risks.  A full register would be compiled and this would be reviewed to see if any were strategic or corporate and needed to be included in the strategic risk register.


    The Strategic Risk Register was last approved by the Committee at its meeting on 20 April 2022.  The register was based under seven themes and was reviewed by the Corporate Management Team before it came to Committee.  The register would be coming back to the Governance and Audit Committee in September 2022.  


    The Strategic Risk controls and actions were tracked and monitored using software that gave a real time picture of the risks.  Progress of risk actions could be tracked through implementation and outcome by Managers.


    A key element of the Annual Governance Statement was the Annual Assurance Statement.  Each Heads of Service had individually compiled an Annual Assurance Statement for 2021/22 which was designed to assess the effectiveness of the key internal control environment and they were asked if they strongly agreed or disagreed with the themes under the seven governance headings.  75% of Heads of Service had agreed with the statements on assurance with the remainder partially or did not agree or did not know as it was felt that it was not relevant to them.  From the information a workplan was developed and shared with the Risk Management Group.  A draft Annual Assurance Statement for 2021/22 would be coming to the July Committee meeting, both the counter fraud and risk management work would be fed into the document.


    The Governance and Risk Officer briefly spoke to the Committee about the Risk Management Group and how effective being part of the Senior Leadership Meetings was.


    A question was asked about risk in respect of the Council’s arm’s length companies and it was stated that it would be a matter for the Companies Committee to  ...  view the full minutes text for item 6.


Annual Treasury Management Review pdf icon PDF 387 KB

    • Share this item

    The report provides the Committee with the details of the Council’s treasury management activity for the financial year 2021/22.

    Additional documents:


    The Assistant Director of Finance presented the Treasury Management Annual Report for 2021/22 which met the requirements of both the CIPFA Code of Practice on Treasury Management and the CIPFA Prudential Code for Capital Finance in Local Authorities.


    The Annual Treasury Management Strategy was approved by Council on 1 March 2021 and a mid-year treasury update was approved by the Governance and Audit Committee at the meeting on 26 January 2022.  The report before Members was the annual review following the year end and described the activity compared to the strategy.


    Member’s attention was drawn to the table on page 31 which summarised the Council’s Treasury position as at 31 March 2022.  The Council had a fixed rate debt of £89.435m as at the 31 March 2022, £3.221m was repayable within the next 12 months.


    The investment position for both short and long term investments as at 31 March 2022 stood at £89.6m, of which £65m was fixed rate investments and £24.6m were variable rate investments.   Variable rate investments had reduced over the last 12 months due to interest rates on notice accounts being inferior to fixed rate investments.   When monies were invested, rates were reviewed to maximize the rate of return but taking into consideration the risk to those investments and also the liquidity position.  Investments were only made following advice from Link Treasury advisors.


    Members were referred to paragraph 2.7 of the report which concerned the £3m investment with the CCLA Property Fund, which invested in property. It was a long term investment where the fluctuation risks could be managed over the period of the investment.   As at 31 March 2022 the investment stood at £3.2m which was an improvement on the previous year of £2.7m.   The main reason for investing in the fund was the quarterly dividend received which was significantly higher than the return on other investments.  The dividend payable for the year was £104k which was a 3.5% return on the investment.


    Member’s attention was then drawn to the graphs within the report that dealt with the duration and counterparties of investments as at 31 March 2022.  The table contained in paragraph 2.11 showed the average rate of return compared with other District Council’s within the comparable groups which showed that at Quarter 4 South Kesteven at a 0.79% average rate of return compared to 0.54% for other authorities.  In paragraph 2.12 appendix 1 should be appendix A.


    The outlook for 2022/23 shown at paragraph 2.13 had been provided by LINK treasury advisors and remained uncertain.  The base rate was increasing faster than anticipated and it was expected that this would be reflected in the interest rates.


    All investments placed during 2021/22 had been repaid on the dates agreed and all cash liquidity requirements had been met throughout the year.  Investment income levels had exceeded the original estimated levels set in the budget and rates were higher than originally estimated.  It was confirmed that Performance Indicators set had been achieved.


    The Officers were thanked for  ...  view the full minutes text for item 7.


Work Programme 2022 - 2023 pdf icon PDF 122 KB

    • Share this item

    To consider the Committee’s Work Programme for 2022 – 2023.


    The Work Programme was discussed and the following points raised;


    ·       Following Member training it was stated that the Committee should approve the Annual Governance Statement but it was not shown on the Work Programme.

    ·       Also, the Committee should meet privately with both Internal and External Auditors when would this take place.

    ·       When would the Scrutiny Review document be reviewed, would this be undertaken by this Committee?


    Reference was made to the Governance and Audit Annual report which was discussed at Council on 26 May 2022.  Appended to the report was the Work Programme for 2022/23.  The Work Programme before Members needed to be updated to reflect the items contained within the Work Programme submitted to Council on 26 May 2022. 


    It was proposed, seconded and AGREED to approve the Work Programme for 2022/23 subject to the amendments raised and the items listed on the Work Programme for 2022/23 submitted to the Council meeting on 26 May 2022.




    The Work Programme for 2022/23 to be amended to reflect those items contained in the Work Programme 2022/23 appended to the Annual Report for the Governance and Audit Committee submitted to Council at the meeting on 26 May 2022.


Any other business, which the chairman, by reasons of special circumstances, decides is urgent.

    • Share this item


    A statement was made by Councillor Baxter.


    Councillor Baxter stated that it had been explained to him that he had a choice, either to make an apology or face a long and expensive process of censure which could potentially prevent him from doing his job as a Councillor.


    At the meeting of the Committee held on 16 March 2022, Councillor Cottier had attended the meeting and Councillor Baxter had drawn the Committees attention to his attendance.  Councillor Cottier had not attended a meeting for five and half months prior to the meeting and had not tended his apologies.  Councillor Baxter had commented that by attending the meeting on 16 March 2022, the Council had been saved from holding a By-election.  The Chairman had said that the comments made by Councillor Baxter in relation to Councillor Cottiers attendance at the meeting were irrelevant, to which Councillor Baxter had responded not as irrelevant as Councillor Cottier.   Councillor Baxter stated that he had only meant to draw attention to Councillor Cottiers attendance record, and his unexpected attendance at the meeting on 16 March 2022.  He understood that people had taken offence by the use of the word irrelevant, and had taken it to be disrespectful to Councillor Cottier. It had not been Councillor Baxter’s intention to insult Councillor Cottier and he unreservedly apologised for any offence caused to anyone by the comments he had made.


Close of meeting

    • Share this item


    The meeting closed at 15:10.