Minute
North Lanarkshire Council · 18 May 2023
Back to Audit and Scrutiny Panel — 18 May 2023 and its agenda
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 33 18 May 2023 at 2 pm. A Meeting of the AUDIT AND SCRUTINY PANEL PRESENT Councillor Watson, Convener; Councillor Dunbar, Vice-Convener; Councillors D. Johnston, T. Johnston, McNally, Robinson, Stevenson and Sullivan. CHAIR Councillor Watson (Convener) presided. IN ATTENDANCE Chief Officer (Audit and Risk); Chief Officer (Finance); Chief Officer (People Resources); Chief Officer (Assets and Procurement); Chief Officer (Education – South); Chief Officer (Business and Digital); Chief Officer (Housing Management); Business Strategy Manager; Supported Enterprise Manager; Strategy and Performance Manager; Education and Families Manager; Category Manager; Corporate Risk Manager; Principal Auditor and Democratic Services Manager. ALSO IN ATTENDANCE P. Murray and J. Boyd, Audit Scotland. APOLOGY Councillor Fisher. DECLARATIONS OF INTEREST IN TERMS OF THE ETHICAL STANDARDS IN PUBLIC LIFE ETC. (SCOTLAND) ACT 2000 1. There were none. STRATEGIC PERFORMANCE FRAMEWORK – PERFORMANCE REPORTING SCHEDULE QUARTERLY PERFORMANCE ASSURANCE REVIEW 2. There was submitted a report by the Chief Officer (Business and Digital) (1) reminding the Panel that it had received a report at its meeting in February 2023 which had provided detail on the Strategic Performance Framework – Performance Reporting Schedule 2023 to 2024; (2) providing a summary of the Cycle 1 Performance report submitted to the Council’s committees in line with that Schedule; (3) explaining that, by bringing together a summary of the Council’s Performance reports into one composite overview, the Panel is able to maintain strategic oversight and awareness of the Council’s performance reporting arrangements in line with its remit and, supports the Panel’s governance and accountability role in terms of ensuring that the Council can demonstrate best value through the existence of robust arrangements for performance reporting and scrutiny, and (4) attaching, as Appendices to the report, (i) Chief Officer’s individual six monthly performance reviews at Service committees in line with the Strategic Performance Framework, (ii) corporate reporting to the Panel and/or Policy and Strategy Committee in line with the Strategic Performance Framework, and (iii) Chief Officer Service specific performance reporting which takes place each year to meet business and/or strategy obligations.
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 34 Decided: that the composite overview of performance reporting, as provided within the Appendices to the report, be noted. IN-DEPTH SCRUTINY OF THE PROVISION OF A PAYMENT SOLUTION FOR TOWER AND LAUNDRIES (NLC–CPT–21-083) 3. There was submitted a report by the Chief Officer (Housing Management) (1) providing a report in response to the Panel’s request for additional information on the provision of a payment solution for the tower laundries; (2) explaining that the purpose for a laundry payment solution was to provide a more efficient payment method for tenants who use the 67 laundries across the 24 towers; (3) advising that the Electrolux system is the only one compatible with the payment system provided by Electrolux due to the complexity of the software provided within the platform and that, after a review of solutions available from Electrolux, the current contract was procured and awarded; (4) detailing that site surveys in all locations had been carried out in April/May 2022 which had highlighted that there was a requirement for electrical work to be carried out in some locations for which the appropriate work orders were issued and, in addition to this, there was also a need for broadband connection to nine of the towers; (5) outlining engagement which had been undertaken with tower residents; (6) outlining delays which had taken place with the installation of updated broadband; (7) providing a narrative on the payment solution which had been installed; (8) explaining that an operational decision had been made during the Covid Pandemic and lockdown which had resulted in the laundry machines being switched to free vend; (9) detailing the loss of income as a result of the decision to operate machines on free vend and providing statistical information on income recovery against anticipated budget for tower laundries, and (10) intimating that it is anticipated that the solution which has been installed will provide a more efficient and convenient payment method using modern technology for tenants living within the multi-storey towers to charge their laundry fobs. Decided: that the contents of the report be noted. IN-DEPTH REVIEW OF SUPPORTED BUSINESSES 4. There was submitted a joint report by Chief Officer (Assets and Procurement), Chief Officer (Place) and Chief Officer (Education – South) (1) notifying the Panel of the in-depth scrutiny review process that had been carried out to address matters and questions raised regarding the Council’s governance, support, business functions and operational processes used to facilitate involvement of supported businesses in its procurement and enterprise development activity; (2) reminding the Panel that it had made a request at its February 2023 meeting for an in-depth scrutiny review of supported businesses; (3) providing a definition of the term Supported Business; (4) explaining that, in relation to the in-depth scrutiny review request, Chief Officers were asked to provide a response to nine individual questions, as detailed in the report, and (5) attaching, as an Appendix to the report, responses received to the questions asked of Chief Officers. During consideration, the Chief Officer (Education – South) confirmed that she would provide further information to the Panel on the services offered by one of the companies listed in the Appendix. Decided: that the information presented in the report in relation to the in-depth scrutiny be noted. AUDIT AND RISK-RELATED ITEMS: ACTION LOG 5. There was submitted a report by the Chief Officer (Audit and Risk) enabling the Panel to track implementation of requests and recommendations made by it in respect of Audit and Risk related items within the previous 18 months, with the action log, attached as an Appendix to the report,
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 35 recording those requests and recommendations made by the Panel where these had been addressed and/or were expected to be addressed. Decided: that the contents of the report be noted. AUDIT SCOTLAND – ANNUAL AUDIT PLAN 2022-23 6. There was submitted a report by the Chief Officer (Audit and Risk) (1) providing the Panel with sight of the Annual Audit Plan 2022-23 received from Audit Scotland, the Council’s appointed external auditor, and (2) attaching, as an Appendix to the report, the Audit Scotland Annual Audit Plan 2022-23. Thereon, J. Boyd, Audit Scotland, presented to the Panel the Audit Scotland Annual Audit Plan 2022-23 and responded to questions from the Panel. During discussion of this matter, the Chief Officer (Finance), following a request from the Panel, confirmed that she would provide to the Panel a report on the value and type of assets held (including details of any cash deposits) in respect of the JC McNaught Poor Children’s Holiday Fund and the North Lanarkshire Council Educational Endowment Fund. Decided: that the Annual Audit Plan by Audit Scotland for 2022-23 be noted. INTERNAL AUDIT PROGRESS REPORT 7. There was submitted a report by the Chief Officer (Audit and Risk) (1) providing an overview of Internal Audit activity; (2) reporting the results of Internal Audit outputs finalised since the last update to the Panel in February 2023; (3) highlighting the most significant issues arising from the completed audit work; (4) updating the Panel on other aspects of the work of Internal Audit, and (5) attaching, as an Appendix to the report, a brief summary of the scope and key findings of each substantive planned audit, together with a summary pack containing copies of these reports. During consideration, the Panel sought a further report in relation to progress made progressing planned actions in respect of the Internal Audit report “Payments to Staff: Overtime and Travel and Subsistence”. Decided: (1) that the findings, conclusions and recommendations of completed Internal Audit reports, together with the associated management responses, be noted; (2) that Internal Audit provide a report to future meetings of the Panel, reporting progress made by management implementing agreed management actions in relation to all audit recommendations categorised as “High” or “Medium”; (3) that a further report be brought to the Panel in respect of progress made progressing planned actions in respect of the Internal Audit report “Payments to Staff: Overtime and Travel and Subsistence”, and (4) that the report be otherwise noted.
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 36 INTERNAL AUDIT: FOLLOW UP OF ACTIONS PREVIOUSLY AGREED BY MANAGEMENT IN RESPONSE TO AUDIT RECOMMENDATIONS 8. There was submitted a report by the Chief Officer (Audit and Risk) (1) detailing the extent to which management had implemented actions previously committed to in response to recommendations in Internal Audit reports, where those actions were to be completed by the end of March 2023; (2) advising that Internal Audit had concluded that, of the 21 outstanding Internal Audit recommendations, ten had been completed, eight partially implemented and three were no longer considered relevant; (3) explaining that of the 12 actions agreed in respect of external audit outputs, seven had been completed, four were not yet due and one was no longer considered relevant, and (4) attaching, as an Appendix to the report, commentary for management and details of proposed management actions, together with reviewed target dates for the completion of those outstanding audit recommendations where Internal Audit had assessed the residual risk as “High” or “Medium”. During consideration, the Panel sought further reports in relation to (i) Risk Management; (ii) Managing Strategic Change, and (iii) the Economic Regeneration Development Plan. Decided: (1) that the contents of the report be noted; (2) that the recommendations made by Internal Audit in the Appendix attached to the report be noted, and (3) that further reports be brought to the Panel in respect of (i) Risk Management; (ii) Managing Strategic Change, and (iii) the Economic Regeneration Development Plan. INTERNAL AUDIT ANNUAL PLAN 2023-24 9. There was submitted a report by the Chief Officer (Audit and Risk) (1) presenting the proposed Internal Audit Plan 2023-24 to the Panel for its consideration and approval; (2) explaining that, whilst the Plan has been presented to Chief Officers for consideration, responsibility for the approval of the Plan lies solely with the Panel; (3) setting out the background and context within which the Internal Audit planning process is undertaken and that it follows a well-established planning methodology, and (4) attaching, as Appendices to the report, (i) the proposed Internal Audit Plan 2023-24; (ii) Internal Audit coverage of current key corporate risks over the previous five years; (iii) Internal Audit coverage of key financial systems over the previous five years; (iv) Internal Audit activity (previous and planned) considered against the Programme of Work to 2028, and (v) Internal Audit Performance Framework. Decided: (1) that the approach adopted to produce the 2023-24 Internal Audit Annual Plan be noted; (2) that the detailed list of proposed Internal Audit assignments for the 2023-24 Plan, as detailed in Appendix 1 to the report, be acknowledged, and (3) that the 2023-24 Internal Audit Annual Plan, as attached at Appendix 1 to the report, be approved. RISK MANAGEMENT UPDATE 10. There was submitted a report by the Chief Officer (Audit and Risk) providing an update to the Panel on key Risk Management developments since the most recent report in February 2023; (2) highlighting a selection of the more significant issues which are of current focus from a risk perspective;
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 37 (3) confirming that risk issues continue to be addressed in relation to a number of significant projects and programmes, and (4) attaching, as Appendices to the report, (i) the 2022-23 Corporate Risk Register and (ii) Risk Scoring Matrix and Descriptors. Decided: (1) that the current residual scores for those risks agreed for inclusion in the Corporate Risk Register for 2022-23, as detailed in Appendix 1 to the report, be noted; (2) that the references to other topical risk issues, as highlighted in the report, be noted, and (3) that the work ongoing to further strengthen and embed risk management arrangements be noted. RAISING ATTAINMENT AND CLOSING THE ATTAINMENT GAP – RISK 11. There was submitted a report by the Chief Officer (Education – South) (1) explaining that, to support the Council in mitigating the risks and uncertainty, it operates risk management arrangements which identify, evaluate, manage and control a range of key corporate risks; (2) indicating that all risks identified and agreed as meriting inclusion in the Corporate Risk Register are subject to regular monitoring and review by relevant senior management and periodic review and consideration of individual risks by both the Corporate Management Team and the Panel in line with the Council’s Risk Management Strategy and their respective roles; (3) highlighting a corporate risk which had been identified that current strategies and approaches do not improve attainment and achievement levels and/or do not reduce the poverty related attainment gap; (4) providing an overview of the current risk environment, as set out and assessed within the deep-dive document attached at Appendix 1 to the report; (5) reminding the Panel that although raising attainment and closing the poverty related attainment gap has been a priority for several years, recent findings outlined by Audit Scotland concluded that progress on closing the poverty-related attainment gap between the most and least deprived school pupils had been limited and falls short of the Scottish Government’s aims, and (6) proposing that further work is required to fully analyse risk impacts and to reflect and develop mitigating actions and controls which may be exercised by the Council to support it to raise attainment and to close the gap. Decided: (1) that the deep-dive document, attached at Appendix 1 to the report, and the indicative risk scoring which reflects both high levels of uncertainty associated with the complex nature of this risk and potentially wide-ranging impacts for the Council associated with this risk be noted, and (2) that it be noted that this risk documentation will be regularly reviewed in keeping with both the high indicative scoring and the fluid risk environment. USE OF TEACHING SUPPLY STAFF 12. There was submitted a report by the Chief Officer (People Resources) (1) informing the Panel that an audit exercise had been carried out regarding short and long term supply teaching staff with the aim to provide assurance on the adequacy and effectiveness of the Council’s key controls and management arrangements with ensuring that teaching supply staff are recruited and employed in a manner consistent with the Council’s legal obligations, the approved Devolved School Management Scheme and the Council’s Financial Regulations and Corporate Budget Monitoring and Control arrangements; (2) outlining that the work had been designed to offer an opinion on two specific questions (i) are supply staff being recruited, employed and paid in accordance with key legal obligations and corporate expectations, and (ii) is there appropriate and effective monitoring and
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 38 oversight of how schools utilise supply staff to ensure that any risk from the use of such staff is effectively managed; (3) reporting that, although the work indicated that there was satisfaction that supply staff were being recruited and paid in accordance with the legislation, SNCT guidelines and corporate expectations, concerns were raised due to the timing of aspects of the SEEMIS system which impacted on many of the key processes for managing and monitoring the use of supply teachers; (4) highlighting the specific concerns required to be addressed by People Resources in conjunction with the Education and Families Service and that, to address these concerns, an agreed Action Plan had now been put in place with appropriate timelines for completion from February to December 2023; (5) detailing that the Action Plan captures complex iTrent system development work to be undertaken together with consultation with teaching trade unions required to address the concerns highlighted in regard to the issuing of contracts of employment beyond two days in line with SNCT guidelines; (6) outlining actions which had already been taken to address any weaknesses, or actions which it was proposed be undertaken, and (7) confirming that the People Resources Team continues to work closely with both Financial Solutions and Education and Families on an ongoing basis to minimise all risks, including those highlighted in the audit report, due to the limited available IT systems solutions. Decided: (1) that the progress already undertaken by People Resources to date be acknowledged; (2) that the timescales for the identified actions to be undertaken be endorsed, and (3) that the challenges regarding iTrent system development be noted. MANDATORY LEARNING 13. There was submitted a report by the Chief Officer (People Resources) (1) explaining that, to support the Council in ensuring that staff are aware of, and fully understand, key statutory and legislative requirements associated with the Council, staff must complete six mandatory e-Learning modules on a two-yearly basis; (2) indicating that work was currently underway to create an appropriate learning resource for frontline staff to provide them with the required knowledge in the areas of Data Protection, Information Security and Records and Information Management which is at a level relevant to their role; (3) highlighting that, to monitor completion levels across all Services, information is provided to the Data Governance Board on a quarterly basis on Data Protection, Information Security, Managing Risk and Records and Information Management training; (4) advising that the Corporate Management Team had recently sought further information on completion levels across all mandatory models to tackle those areas where completion levels are low and that this information has been presented to each Senior Management Team with individual reports sent to all Chief Officers highlighting all staff who have yet to complete their mandatory learning; (5) explaining that there is a commitment to get levels of completion across all mandatory e-Learning modules to 100% and outlining how the Council identifies, ensures and gains assurance that staff are aware of their responsibilities to ensure that they have undertaken the mandatory learning modules, and (6) attaching, as Appendices to the report, examples of the learner dashboard that can be used by employees on LearnNL, and an example of a managers dashboard that can be used on LearnNL. Decided: (1) that the approach to more closer monitoring of completion rates across the Council be endorsed; (2) that the work which is being undertaken by People Resources, in conjunction with Business and Digital, to increase completion levels across all services be acknowledged, and (3) that the approach for frontline staff, which will introduce learning activities covering mandatory learning areas relevant to their role, be endorsed.
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AUDIT AND SCRUTINY PANEL - 18 MAY 2023 39 PRE-EMPLOYMENT CHECKS 14. There was submitted a report by the Chief Officer (People Resources) (1) reminding the Panel that it had requested an update on how the Council plans to strengthen pre-employment checks, or otherwise address the issues highlighted in a recent audit report regarding the Council’s re-employing someone who had previously left, or been dismissed during an investigation; (2) advising that the Service had now considered a range of options for addressing the issues highlighted, whilst taking account of relevant legislation which applies, including employment, equalities and other data protection legislation, particularly as it applies to the rights of individuals, and (3) presenting the Panel with a list of planned actions which People Resources was now proposing to implement which had resulted in changes to the recruitment process as detailed in the report. Decided: that the actions which are now underway to identify where an employee has previously been employed by the Council, and to undertake the relevant checks which can lawfully be used to assess their suitability, or otherwise, to be re-employed in a similar or other capacity, be noted.