Agenda item

Report of the Financial Planning Manager

The Interim Director of Resources welcomed the External Auditors to the meeting.  He added that as the Financial Planning Manager was unfortunately not in attendance, any technical answers would be addressed outside of the meeting.

Mr S Gill, External Auditor, presented his report to Members highlighting the audit risks, judgements, key issues and recommendations.  He also informed Members that from the year 2017/18 there would be a new statutory requirement to produce a draft set of accounts earlier, this shortened the amount of time available to audit and would impact on the current accounting practices.  He concluded by thanking the Financial Planning Manager and her team for the work undertaken.

Councillor S Sheahan referred to the key issues within appendix one of the report and asked what the issue was regarding the cash flow.  He was concerned as it had been an issue for the past two years.  The Interim Director of Resources responded that he was unsure of the exact issue but he was aware that the Financial Planning Manager had taken steps to manage the cash flow but further information would be provided outside of the meeting.

Councillor F R D Fenning referred to recommendation three within appendix two of the report and questioned if the service was appropriately staffed due to the number of mistakes being made.  The Interim Director of Resources agreed to circulate information regarding how the overpayments of benefits was being addressed.  He added that recovery of overpayments were difficult for a number of reasons and there were also legal restrictions.  Councillor D Harrison also raised concerns as tax payers money was being mistakenly given away.  He asked for assurances that serious work was being undertaken to prevent this in the future.  The Interim Director of Resources reported that a large part of the overpayments was due to changes in claimants’ personal circumstances rather than errors being made by staff and once again referred to the further information he would be circulating.

Councillor S Sheahan questioned when Universal Credit would be introduced in the district and asked for assurances that the authority was prepared.  The Interim Director of Resources responded that preparations were being made and there was a session planned with the Department of Work and Pensions to assist with dealing with the change.  He confirmed that it would be introduced in parts of the district in 2018, with full implementation in 2019.  He also suggested that a report considered by the Revenues and Benefits Joint Committee on this matter be circulated to Members.

Councillor D Harrison commented that people were now worried about the pension deficit and asked how the authority was planning on dealing with the issue.  The Interim Director of Resources reported that the authority had recently received information to confirm that there were pressures but it was being managed and therefore no action was required at the moment.

Councillor S McKendrick referred to the coming changes in accounting practices for the year 2017/18 and asked if the staff were prepared.  The Interim Director of Resources explained that staff would receive additional training and the Financial Planning Manager was currently looking at best practice as other authorities were already working to the new timescales.

At the request of Councillor G A Allman, the Interim Director of Resources agreed to provide a percentage figure for housing benefit in proportion to the overall budget outside of the meeting.

Councillor F R D Fenning referred to the current work being undertaken around the leisure service which would involve the transfer of a proportion of council employees, he asked if this had been considered by the external auditors.  Mr T Crawley, External Auditor, explained that they did not get involved with Council decision making and were only looking at the current accounts, therefore this area of work was not yet included.  However, he did keep in regular contact with the Financial Planning Manager to have an idea of what was coming in the future.

Councillor S Sheahan commented that there seemed to be a lot of budget surplus which was not being spent.   The Interim Director of Resources explained that the surplus was being put into reserves in accordance with the Council’s current strategy to safeguard for the future.  He reported that a surplus had been growing due to planning and recycling income, investments, plus collection of business rates.  He added that it would all be detailed within the budget report for Cabinet and the surplus was reviewed regularly.  Councillor S Sheahan was frustrated that money was being put into reserves when it could be used towards some of the Council’s deficit.  The Interim Director of Resources reiterated that surplus was dealt with in accordance with the current budgeting strategy.

Councillor S Sheahan also raised concerns regarding the surplus in the Housing Revenue Account due to underspend on cyclical repairs in housing and asked if there was an issue in getting work completed. The Interim Director of Resources agreed to provide the information outside of the meeting.

It was moved by Councillor J Cotterill, seconded by Councillor R Ashman and

RESOLVED THAT:

a)      The content of the External Auditor’s Report be noted.

b)      The letter of representation be approved.

c)      The External Auditor’s recommendations and the management comments as set out in appendix one be noted.