Agenda and draft minutes

To receive any apologies for absence

There were apologies for absence from Councillor Deering and Councillor Woollcombe. It was noted that Councillor Connolly was substituting for Councillor Woollcombe. 

To approve as a correct record the minutes of the meeting held on 25 September 2024.

It was moved by Councillor Williamson and seconded by Councillor Nicholls, that the Minutes of the meeting of the Committee held on 25 September 2024 be confirmed as a correct record and signed by the Chair. After being put to the meeting and a vote taken, the motion was declared CARRIED.

RESOLVED – that the Minutes of the Committee meeting held on 25 September 2024 be confirmed as a correct record and signed by the Chair.

The Chair welcomed all to the meeting. He said that it would be interesting to see how the Government’s Autumn Budget would affect areas within the Council such as Planning.

To receive any declarations of interest.

There were no declarations of interest.

The Interim Chief Executive delivered a presentation to the Committee which gave an update on the Transforming East Herts project, which projected savings for 2024/25 of £781,000. She said that these savings included those made by the creation of the new Corporate Support Hub, non-recruitment to vacant Senior Leadership Team posts and the implementation of the new Adelante Smart Pay system.

The Interim Chief Executive said that the remaining savings for the year would be achieved by changes within the Revenues and Benefits Service following a review by Liberata, and by maximising the use of the Capita system.

The Interim Chief Executive said that there were three streams to the programme, Be Agile – which had seen the launch of a new staff intranet, giving savings of £28,000. Be Commercial – which included reviewing the options for the future of the Wallfields building and Be Digital – which included Adelante Smart Pay going live in November 2024.

The Head of Strategic Finance and Property gave assurance that cash or cheque payments would still be available at the post office and via PayPoint.  

The Chair thanked the Interim Chief Executive for her presentation. Councillor Nicholls asked how cultural change would be achieved with staff and Members. 

The Interim Chief Executive said that staff received regular staff briefings and that the East Herts Together Team also cascaded information down. She said that Members could be included in these activities, with Thursday evening briefings a possibility.

The Chair asked for clarification of the governance arrangements for the programme, and a timescale for the savings.

The Interim Chief Executive said that the well-versed Programme Manager met monthly with the three strand leaders at the programme’s Governance Board. She said that consideration was being given to all of Leadership Team being on the Governance Board, to give complete oversight/ownership of the programme. 

The Interim Chief Executive said that a totaliser had been introduced as a visual aid for the savings total. She said that annual timescales were seen as more robust than timescales against individual projects within the programme, and that this approach avoiding swamping the Transformation Team.

Mr Poppy said that it may be beneficial for officers to liaise with Welwyn Hatfield Council as they had a Go Ape activity centre within their district. He added that other Local Authorities may also be able to share their experience of letting out office space.

The Interim Chief Executive said that all decisions relating to the Wallfields building would need to be the right decision, made at the right time. She said that Members were keen to retain their own Council Chamber.

Councillor Brittain asked if the programme would be reviewed, and new items added.

The Interim Chief Executive said that the project would be forever ongoing, with officers trained in Lean Six Sigma giving input into finding items which require attention. She said it was important that each project within the programme was completed to avoid drift.

The Chair asked if the Interim Chief Executive  ...  view the full minutes text for item 213.

The Executive Member for Financial Sustainability introduced the report, directing the Committee to Appendix A which gave the current Community Asset Register. He explained how the legislation pertaining to the register was designed to provide additional safeguard for community facilities.

The Chair thanked the Executive Member for Financial Sustainability for his report.

Councillor Willcocks sought clarification as to why the Yew Tree Public House had a ten-year expiry date of 2027, and why the Crooked Billet remained on the register when it had an expiry date of 9 April 2024.

The Executive Member for Financial Sustainability said that the date of expiry for the Yew Tree Public House was an error, which would be corrected. 

The Head of Communications, Strategy and Policy said that new guidance was to keep expired nominations on the register.

Councillor Nicholls observed that a number of assets were due to expire next year, and asked if reapplication was possible. She also asked if the process worked well for communities.

The Head of Communications, Strategy and Policy said that officers advised Ward Members and community groups when an asset was due to expire, and that re nomination was a simple process. He said that a handful of assets did transfer to community groups, and that government funding for groups to assist with business cases and purchases would strengthen the scheme further.  

Councillor Willcocks asked if assets would come off the register if they were sold and converted for residential use. 

The Head of Communications, Strategy and Policy said that residential properties were exempt, and would not be eligible for renomination.

Councillor Nicholls asked if council property could be nominated.

The Head of Communications, Strategy and Policy said that it did not matter who the landlord was, if the property had community value it could be nominated. He added that there was a council owned property on the current register.

The Chair asked if there could be any financial implications for the council.

The Head of Communications, Strategy and Policy said that should a landlord be able to prove that being on the register had jeopardised a sale or had a financial impact the Council could be liable for compensation via a First-Tier Tribunal. He said however, that he did not know of any cases where this had occurred.   

The Chair asked if there were any nominations which were pending.

The Head of Communications, Strategy and Policy said that there were currently 31 properties listed on the register, with 4 nominations in progress (3 of which were in Watton-at-Stone, and one a footpath in Bengeo).

It was moved by Councillor Willcocks and seconded by Councillor Williamson, that the recommendations, as detailed, be approved. After being put to the meeting and a vote taken, the motion was declared CARRIED.

RESOLVED – that the Asset Register be reviewed and any comments regarding Assets of Community Value be given.

The Ernst and Young LLP (EY) representative introduced the report which gave interim commentary on the Value for Money (VFM) arrangements for the Council.

The EY representative gave context to the interim report by explaining that work was not fully concluded in all areas – with information received from the council last week, which had prompted further queries. She said that EY were not in a position to give an audit opinion, adding that this needed to be completed by the backstop date of 30 December. The EY representative said that therefore, the VFM report would come back to Members as a composite report to include audit opinions. 

The EY representative said that fairly significant issues had been raised within the report, which would impact the audit opinion. She said that it was quite a complex and unusual situation, explaining that the statutory backstop dates had been brought in nationally by the Local Government Minister to clear the system wide audit backlog and reset the public audit system.

The EY representative said that the backstop date of 30 December had been given for the conclusion of all audits up to 31 March 2022, but to enable this a set of financial statements for that year needed to be produced/published, have undergone the thirty-day public inspection period, and subsequently been approved.

The EY representative said that VFM had three key areas;

·            Financial Sustainability

·            Governance

·            Improving Economy

The EY representative referred to page 37 of the report which detailed two areas of significant weakness around governance and improving economy, efficiency, and effectiveness. The first related to the non-preparation and publication of the financial statements for 2021/22 and 2022/23, and the Annual Governance Statement for 2021/22. The second in respect of the delays and overspends on major projects – in the main Hertford Theatre. 

The EY representative drew Members attention to the key findings around financial sustainability, which could be found at page 40 of the report. She said that there were no significant weaknesses identified, but as per the Finance Peer Challenge areas of improvement in financial management and reporting had been noted (which could be seen at page 43).

The EY representative referred to the council’s Minimum Revenue Provision (MRP) and said that the organisation was previously debt free, but now borrowing - largely to support its capital programme. She said that EY was recommending that the council;

·            Review its MRP policy and calculation to ensure it is necessarily prudent.

·            Ensure robust savings plans are in place.

·            Ensure that planned savings are produced in a timely manner.

·            Mitigate the future use of reserves balances. 

The EY representative referred back to the weaknesses identified in the council’s governance arrangements and said that the accounts for 2021/22 were not published until December 2023 with the Annual Governance Statement not included and the Statement of Responsibilities out of date. She said that the 2022/23 accounts were again published late, and that a Statement of Responsibilities and a narrative statement were not included. 

The EY  ...  view the full minutes text for item 215.

The Executive Member for Financial Sustainability introduced the report, which detailed the Annual Treasury Management Review and Prudential Indicators for 2023/24 at Appendix A.

The Executive Member for Financial Sustainability drew Members attention to the tables from page 66 of the report and said that these contained numerical errors which would be corrected and recirculated.

The Chair thanked the Executive Member for Financial Sustainability for his report.

Councillor Williamson asked if there were any main concerns within the report.

The Executive Member for Financial Sustainability said that the content of the report was always anticipated, with increased borrowing inevitable. He said that as this was planned it was no concern.

Mr Sharman said that it was important to keep an eye on the risks relating to a potential reduction in reserves. 

The Executive Member for Financial Sustainability said that there was £2 million in the Council’s reserves, but it was impossible to say at this time if this would be enough.

It was moved by Councillor Nicholls and seconded by Councillor Connolly, that the recommendations, as detailed, be approved. After being put to the meeting and a vote taken, this motion was declared CARRIED.

RESOLVED – that Members examine and comment on the Annual Treasury Management Review and Prudential Indicators for 2023/24.

The Executive Member for Financial Sustainability introduced the report, which reviewed the content of the corporate risk register.

The Chair thanked the Executive Member for Financial Sustainability for his report and asked if EY’s findings (as presented to the Committee at the meeting) would be swept up and included.

The Executive Member for Financial Sustainability said that implications of EY’s findings would be investigated.

RESOLVED – that the 2024/25 quarter one corporate risk register and actions being taken to control and mitigate risk be noted.

The Executive Member for Financial Sustainability introduced the report, which set out the savings requirements, the assumptions, risks, and uncertainties facing the council in setting and timetabling the budget.

The Executive Member for Financial Sustainability said that the Mid Term Financial Plan (MTFP) was approved by Council in February 2024, where a savings target of £4.2 million was agreed. He said that the budget monitoring process had identified a number of pressures on the 2024/25 budget, which currently forecast a £1.1 million overspend. He said that a number of these pressures where one offs, with £0.55 million having any ongoing impact.

The Executive Member for Financial Sustainability said that MTFP planning used three scenario models. He said that the Base Case, which was the most likely and therefore used in budget preparations could be found at Appendix A of the report.[PM1] 

The Executive Member for Financial Sustainability said that the 2024/25 savings had been reviewed, and could be seen in Appendix C of the report, with reserves detailed in Appendix D. He said that lots of work was required, and that he was hopeful that the Government would give extra support.

The Chair thanked theExecutive Member for Financial Sustainability for his report.

Councillor Williamson said that the report was the first in a cycle and set the scene. He said that it was helpful to have the scenario modelling included, and asked for clarification regarding the differing savings targets in Appendix A and B.

The Executive Member for Financial Sustainability said that the savings figure of £1.4 million related to a previous target, set earlier in the year. He said that the figure of £1.96 million was the new outcome figure.

Councillor Connolly said that she understood the three scenario cases but asked for clarification of how monthly Council Tax collections were modelled within the pessimistic case. 

The Executive Member for Financial Sustainability said that:

·            The Base Case – assumes that Council Tax increases in line with the current referendum limit of 2.96%

·            The Optimistic Case - assumes that the current referendum limit may be relaxed to allow an increase in Council Tax of more than 2.96%.

·            The Pessimistic Case – assumes that the Council Tax referendum limit of 2.96% remains andthat grants from Government to Local Authorities are also reduced.

Councillor Hart asked if there was a contingency plan should the projected figures for BEAM (formally Hertford Theatre) not be met. She said that these figures had been optimistic, but that the arts were in decline nationally. 

The Executive Member for Financial Sustainability said the 2024/25 figures for BEAM had not been revised, adding that the venue was in its infancy, having been open for only two months. He said that a review by external consultants to identify challenging areas, learn processes to meet forecasts in the business plan would be undertaken.

The Executive Member for Financial Sustainability said that there was no contingency plan for BEAM in isolation, but that it did form part of  ...  view the full minutes text for item 218.

The Head of Strategic Finance and Property introduced the report and invited any questions or comments from Members.

Councillor Nicholls said that she welcomed the extra meetings which had been arranged for the current civic year and asked if having no meetings scheduled in between May and September 2025 was a good idea.

The Committee Support Officer said that the Committee Timetable was currently being put together by the Democratic and Electoral Services Manager. She said that the meetings of the Audit and Governance Committee would likely be a conversation[PM1]  for the new Section 151 Officer.   

Mr Sharman asked if the Committee would receive an update from this evening’s EY presentation at the next meeting.

The Chair said this would be a natural update at the next meeting.

Councillor Williamson observed that the January meeting of the Committee had nine agenda items (to include the budget) and asked if any reports could be postponed – such as the Data Protection Update and/or the Anti-Fraud Progress Report.

The Chair said that he would discuss these issues with officers, and that scheduling could be revisited at the next meeting of the Committee in November 2024. 

Councillor Williamson questioned if the Procurement Strategy should be on the Work Programme, and instead be for the attention of the Overview and Scrutiny Committee.

The Head of Strategic Finance and Property said that it was correct that the Procurement Strategy come to the Audit and Governance Committee.

It was moved by Councillor Nicholls and seconded by Councillor Willcocks, that the recommendations, as detailed, be approved. After being put to the meeting and a vote taken, this motion was declared CARRIED.

RESOLVED – that A) the work programme as set out in the report be approved; and

(B) that any training requirements be specified. 

To consider such other business as, in the opinion of the Chairman of the meeting, is of sufficient urgency to warrant consideration and is not likely to involve the disclosure of exempt information.

There were no urgent items.