Agenda item

To consider a report by the Director of Finance and Corporate Services providing an update on the implementation of audit actions.

With the aid of a report prepared by the Director of Finance and Corporate Resources (a copy of which is appended in the Minute Book) the Committee received an update on the implementation of audit actions. A summation of the discussions is outlined as follows.

By way of background, the Director of Finance & Corporate Resources introduced the report and as a result of discissions on the matters raised it was acknowledged that there are potentially risks behind every purchase and whilst they cannot be avoided, they can be managed by identifying both internal and external risks to the supply chain. Then eliminating those situations that would put HDC at unnecessary or increased risk. Therefore, it is important that HDC has effective risk management to map out those potential risks, the likelihood of their occurrence, and whether or not they can effectively avoid those risks without disturbance to the Council’s supply chain.

Following comments from Councillors Gray and Jennings the Committee was in agreement that the activities of the Internal Audit team are pivotal to the organisation’s governance and control processes and therefore need to be properly resourced. As the outcomes of the Audit Teams activities will establish, if there is the necessary controls and processes in place these will show where any improvements should be made. Tracking the recommendations and closure of these is key to maintaining good control and evidencing the organisation’s commitment to delivering good quality, high value for money services with good control and compliance with the relevant statutory obligations.

The Committee acknowledged that procurement within HDC needs to be properly resourced as effective procurement has never been more important with increased economic pressures on the Council and its suppliers to look beyond the financial cost of a contract to consider how the services HDC commissions and procures can improve the quality of life for local people and create a better Huntingdonshire for future generations. Whilst  reflecting the Council’s commitment to equality, diversity and inclusion through how HDC deliver, resources and transforms  all of its services in a way that is inspiring, collaborative, accountable, respectful and enterprising.

Members also wanted to make sure that the Council builds into the HDC grant applications, the cost of providing that procurement and secondly improves resilience through (i) clear governance, (ii) audit trail, (iii) effective contract management and (iv) transparency. Accordingly, the Committee therefore agreed that it needs to formally express its concerns to the Chief Executive and the Cabinet that investment in the procurement process is essential to ensure that it functions effectively. The Committee was advised that Councillor S W Ferguson the Executive Councillor for Customer Services was meeting with the Council’s Chief Executive and would be stressing that such investment takes place as a priority. In addition, the Committee Chair Councillor N Wells indicated that he would also be raising this matter with the Chief Executive.

Following comments from Councillor Hodgson-Jones the Committee asked why this issue was not on the corporate risk register as procurement has an impact, not just financial but where HDC gets the incorrect price for goods and services or purchases the inappropriate goods and services. This means the process of procuring these goods and services needs to be undertaken again and also has an impact on the reputation of HDC. Therefore, if there are audit actions on procurement that simply are not progressing as expected then the Committee should be looking at including this on the register of potential risks relating to procurement. Accordingly, the Director of Finance & Corporate Resources agreed to undertake to discuss this with the Senior Leadership Team.

The Committee also noted under the Outstanding Audit Action No. 1680 Fuel Usage and Payments (a copy of which is appended in the Minute Book) the reference to the requirement for a spare 50,000 litre tank at the Councils Eastfield House for the storing of Hydrogenated Vegetable Oil (HVO) as part of the trail to reduce the need for hydrocarbon fuel (i.e. diesel) the outcome of this trial will determine if there will be an ongoing need for a spare 50,000 litre tank.

Members also requested an update in regard to Outstanding Audit Action No. 1658 Shadow IT/Service-Procured Systems (a copy of which is appended in the Minute Book) about revising the Council’s Code of Procurement including both new thresholds and terminology.

The Committee was informed that in regard to Outstanding Audit Action No. 1613 Small Works Contract (a copy of which is appended in the Minute Book) responsibility for this action has been reviewed and will be formalized once the contract has been let and the intention being that the new contract will be awarded in April 2024.

The Committee was notified that with regard to Outstanding Audit Action No. 1652 Corporate Enforcement Policy (a copy of which is appended in the Minute Book) an action has been included within the Community service plan to be rewritten and to then have approved as a new Corporate Enforcement Policy. It was noted that this policy is intended to inform the public of the Council’s enforcement policy and operational guidance relating to the enforcement of environmental crime that covers a diverse range of issues such as noise, litter, waste and refuse, dogs and pests.

Finally noted that the HDC Internal Audit Manager was on a leave of absence and arrangements had therefore been made to ensure continued independent evaluation of risk management, control and governance processes.

The Committee having considered and commented on the report RESOLVED to formally recommend to the Cabinet that as a priority.

1. The HDC Audit Team needs to be properly resourced.
2. Procurement should be included within the HDC Corporate Risk Register.