Document Pack (Bookmarked) - Audit Committee - 10 December 2025
West Dunbartonshire Council · 10 December 2025
Back to Audit Committee — 10 December 2025 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
Page 1
Agenda Audit Committee Date: Wednesday, 10 December 2025 Time: 14:00 Venue: Civic Space, 16 Church Street, Dumbarton G82 1QL Contact: Lynn Straker, Committee Officer lynn.straker@west-dunbarton.gov.uk committee.admin@west-dunbarton.gov.uk Dear Member Please attend a meeting of the Audit Committee as detailed above. The business is shown on the attached agenda. Yours faithfully PETER HESSETT Chief Executive Page 1
Page 2
Distribution: Councillor Gordon Scanlan (Chair) Councillor Sophie Traynor (Vice Chair) Councillor Ian Dickson Councillor Michelle McGinty Councillor John Millar Councillor Lauren Oxley Councillor Martin Rooney Councillor Clare Steel All other Councillors for information Chief Executive Chief Officers Date of Issue: 27 November 2025 Page 2
Page 3
AUDIT COMMITTEE WEDNESDAY, 10 DECEMBER 2025 AGENDA 1 APOLOGIES 2 DECLARATIONS OF INTEREST Members are invited to declare if they have an interest in any of the items of business on this agenda and the reasons for such declarations. 3 MINUTES OF PREVIOUS MEETING 5 - 8 Submit for approval, as a correct record, the Minutes of Meeting of the Audit Committee held on 24 September 2025. 4 OPEN FORUM The Committee is asked to note that no open forum questions have been submitted by members of the public. 5 INTERNAL AUDIT PLAN 2024/25 9 - 28 PROGRESS TO 31 OCTOBER 2025 Submit report by Chief Officer - Resources advising of progress to 31 October 2025 against the Internal Audit Plan for 2024/25. 6 2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN 29 - 37 Submit report by Chief Officer - Resources advising on the planned programme of work for the Internal Audit Section for the year 2025/26. 7 EXTERNAL AUDIT PROGRESS REPORT To Follow Submit report by Chief Officer - Resources advising on the above. 8 PUBLIC INTEREST DISCLOSURES AND OTHER 39 - 45 INTERNAL AUDIT INVESTIGATIONS 1 APRIL TO 31 OCTOBER 2025 Submit report by Chief Officer - Resources advising on the outcome of investigations into allegations and disclosures in line with public interest disclosure and business irregularities policies received by Internal Audit between 1 April and 31 October 2025. Page 3
Page 4
9 SCOTTISH PUBLIC SERVICES OMBUDSMAN 47 - 59 COMPLAINTS REPORT 2024-2025 Submit report by Chief Officer - Citizen, Culture and Facilities presenting the Scottish Public Services Ombudsman (SPSO) report on complaints handling by West Dunbartonshire Council for the year 1 April 2024 - 31 March 2025. 10 TREASURY MANAGEMENT MID-YEAR REPORT 2025/2026 61 - 76 Submit report by Chief Officer - Resources providing an update on treasury management to 30 September 2025. 11 ACCOUNTS COMMISSION REPORT - AUDIT OF GLASGOW 77 - 106 CITY COUNCIL SENIOR OFFICER EXIT PACKAGES Submit report by Chief Officer - Resources providing detail on West Dunbartonshire Council’s response to the recommendations arising from a recent Controller of Audit’s report to the Accounts Commission on governance and transparency of decision making of exit packages of senior officers in Glasgow City Council. 12 EXTERNAL AUDIT ENQUIRIES - 2024/25 ACCOUNTS 107 - 119 Submit report by Chief Officer - Resources informing of External Audit’s requirement for the provision of information regarding the Council’s approach to dealing with fraud, litigation, laws and regulations as part of their audit of the Council’s 2024/25 Statement of Accounts and 2024/25 Trust Accounts. ___________________________________________________________________ Page 4
Page 5
AUDIT COMMITTEE At a Meeting of the Audit Committee held in Council Chambers, Clydebank Town Hall, 5 Hall Street, Clydebank on Wednesday, 24 September 2025 at 10.00 a.m. Present: Councillors Michelle McGinty, John Millar, Lauren Oxley, Martin Rooney, Gordon Scanlan and Sophie Traynor. Attending: Peter Hessett, Chief Executive; Laurence Slavin, Chief Officer – Resources; Andi Priestman, Shared Service Manager – Audit and Fraud; Julie Slavin, Chief Financial Officer – HSCP; Carol Alderson, Finance Manager; Claire Cusick, Senior Education Officer; Tom Reid, External Auditor – Forvis Mazars and Lynn Straker, Committee Officer. Apologies: Apologies for absence were intimated on behalf of Councillors Ian Dickson and Clare Steel. Councillor Gordon Scanlan in the Chair DECLARATIONS OF INTEREST It was noted that there were no declarations of interest in any of the items of business on the agenda. MINUTES OF PREVIOUS MEETING The Minutes of Meeting of the Audit Committee held on 11 June 2025 were submitted and approved as a correct record. OPEN FORUM The Committee noted that no open forum questions had been submitted by members of the public. STRATEGIC RISKS 2022-2027 A report was submitted by the Chief Officer – People and Technology providing an update on the strategic risks for 2022-2027. Item 3 Page 5
Page 6
After discussion and having heard the Chief Officer – People & Technology and Chief Officer - Resources in further explanation and in answer to Members questions, the Committee agreed to note the strategic risks as detailed at Appendix 1 of the report. INTERNAL AUDIT PLAN 2024/25 PROGRESS TO 31 JULY 2025 A report was submitted by the Chief Officer – Resources advising of progress to 31 July 2025 against the Internal Audit Plan for 2024/25. After discussion and having heard the Shared Service Manager – Audit and Fraud and the Chief Officer – Resources in further explanation and in answer to Members’ questions, the Committee agreed to note the report. EXTERNAL AUDIT PROGRESS REPORT A report was submitted by the Chief Officer – Resources advising Members of the outcome of investigations into allegations and disclosures in line with public interest disclosure and business irregularities policies received by Internal Audit between 1 November 2024 and 31 March 2025. After discussion and having heard the Audit Director - Forvis Mazars in further explanation, the Committee agreed to note the report. 2024/2025 TREASURY MANAGEMENT ANNUAL REPORT A report was submitted by the Chief Officer – Resources advising Members of the treasury function and its activities in 2024/25 and requesting that the Committee remits the report to the full Council for its approval. After discussion and having heard the Chief Executive, the Chief Officer – Resources and Finance Manager in further explanation and in answer to Members’ questions, the Committee agreed:- (1) to note the contents of the 2024/25 Annual Treasury Management Report and; (2) to remit the 2024/25 Annual Treasury Management Report to full Council for approval. VALEDICTORY ANDI PRIESTMAN, SHARED SERVICE MANAGER - AUDIT AND FRAUD Laurence Slavin, Chief Officer - Resources, informed the Committee that this would potentially be the last meeting of Audit Committee that Andi Priestman, Shared Service Manager - Audit and Fraud, would attend as she would soon be moving to a different post within the Council. Members passed on their best wishes and thanked Ms Priestman for her dedication and long service to the Audit Committee and wished Page 6
Page 7
her the very best in future. In response, Ms Priestman thanked the Committee for its kind words. The meeting closed at 10.38 a.m. Page 7
Page 8
Page 8
Page 9
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - Resources Audit Committee - 10 December 2025 Subject: Internal Audit Plan 2024/25 - Progress to 31 October 2025 1. Purpose 1.1 The purpose of this report is to advise Members of progress to 31 October 2025 against the Internal Audit Plan for 2024/25. 1.2 The report also advises Members of: recently issued Internal Audit reports and action plans the status of implementation progress relating to action plans from previously issued Internal Audit reports. 2. Recommendations 2.1 It is recommended that Members note the contents of this report. 3. Background 3.1 The annual audit plan for 2024/25 was approved by the Audit Committee on 4 December 2024. This report provides information on the progress in implementing the plan. 3.2 When audit reports are issued by Internal Audit, an action plan is agreed with management in relation to issues highlighted by the audit report. Progress on implementing the actions is monitored by Internal Audit on a monthly basis and reported to the Audit Committee. 4. Main Issues 4.1. The annual audit plan sets out the audit coverage for the year utilising available staff resources to enable the Shared Service Manager – Audit & Fraud to provide the annual internal audit opinion regarding the adequacy and effectiveness of internal control within the Council. 4.2 In accordance with the risk-based audit methodology, for each audit, one of four audit opinions is expressed: Strong In our opinion there is a sound system of internal controls designed to ensure that the organisation is able to achieve its objectives. Satisfactory In our opinion isolated areas of control weakness were identified which, whilst not systemic, put some organisation objectives at risk. Item 5 Page 9
Page 10
Requires Improvement In our opinion systemic and/or material control weaknesses were identified such that some organisation objectives are put at significant risk. Unsatisfactory In our opinion the control environment was considered inadequate to ensure that the organisation is able to achieve its objectives. 4.3 Detailed findings and recommendations reported to management are graded using the following criteria: Red In our opinion the control environment is insufficient to address the risk and this could impact the Council as a whole. Corrective action must be taken and should start immediately. Overseen to completion by Corporate Management Team. Amber In our opinion there are areas of control weakness which we consider to be individually significant but which are unlikely to affect the Council as a whole. Corrective action must be taken (some exceptions may be agreed with Internal Audit) within reasonable timeframe. Overseen to completion by Chief Officer/Head of Service. Green In our opinion the risk area is well controlled or our audit highlighted areas for minor control improvement and/or areas of minor control weakness. Process improvements/efficiencies may be actioned at management discretion in consultation with Internal Audit. Managed by service owner. Not reported in Audit Committee papers. 4.4 There were no audit reviews finalised since the September 2025 Audit Committee. Due to an unanticipated vacancy arising in the team, some audits were delayed in starting but have been reallocated to other members of the team to finalise. 4.5 In relation to audit work for the Integration Joint Board, work is now complete for the 2024/25 audit plan. 4.6 In relation to the Valuation Joint Board, the audit for 2024-25 is now complete. 4.7 In relation to the Leisure Trust, the audit for 2024-25 is now complete. 4.8 Internal Audit Action Plans In relation to audit action plans, these are monitored by Internal Audit on a monthly basis. The status report at 31 October 2025 is provided at Appendix 2. Ongoing Corporate Fraud Team Work 4.9 The Corporate Fraud team’s day to day work continues to focus on referrals relating to council tax reduction/single person discounts, joint working with DWP in relation to housing benefit and council tax reduction, referrals relating to housing tenancies and investigating relevant national fraud initiative matches. Page 10
Page 11
4.10 The Internal Audit Team and the Corporate Fraud Team continue to work together as appropriate in order to ensure a joined-up approach to fraud investigation and detection for example in relation to whistleblowing enquiries. National Fraud Initiative 4.11 The National Fraud Initiative is a series of biennial exercises run by the Cabinet Office and Audit Scotland to identify or prevent fraud and error by matching electronic data held by public bodies. Participating bodies are required to investigate data discrepancies within a set timescale and report back on any savings. 4.12 In relation to the 2024 exercise, a significant number of matches have been received in relation to a range of datasets including Housing Benefit, Council Tax Reduction, Payroll, Business Rates, Creditors and Blue Badges. High risk matches have been prioritised for investigation and progress is as follows: Matches Received Number Investigated Number in Progress No Issue Fraud (1) Error (2) Value of Fraud/Error 9712 803 31 613 79 80 £157,396.59 (1) Fraud relates to: 76 CTR cases where income was not fully declared. Recovery is in progress; 1 Housing Benefit case where income was not fully declared. Recovery is in progress; and 2 cases of tenancy fraud. Properties have been recovered. (2) Errors relate to: 79 blue badges which had not been cancelled on the system; and 1 case where CTR was not updated in relation to a deceased case. Benchmarking 4.13 In accordance with the Council’s Strategic Improvement Framework, the Council’s Internal Audit service continues to be part of a benchmarking group which involves seven other Councils. 5. People Implications 5.1 There are no people implications. 6. Financial and Procurement Implications 6.1 The Corporate Fraud Team activity can result in actual recoveries, charges and re-billings. The total amount of actual recoveries, charges and re-billings identified will be included in the Internal Audit Annual Report and Assurance Statement for 2025-26. 6.2 There are no procurement implications arising from this report. Page 11
Page 12
7. Risk Analysis 7.1 There is a risk that failure to deliver the Internal Audit Plan would result in an inability to provide a reasonable level of assurance over the Council’s system of internal financial control to those charged with governance. The main basis for providing assurance is coverage of the planned risk-based audits. Every endeavour is made to ensure that no material slippage occurs in risk-based audits by concentrating resources on these audits. 8. Equalities Impact Assessment (EIA) 8.1 There are no direct equalities impacts arising from the report however where an agreed action results in a change in process this will be considered for equalities impact by the relevant service. 9. Consultation 9.1 This report has been subject to consultation with appropriate Chief Officers. 10. Strategic Assessment 10.1 This report helps ensure strong governance and will help support delivery of the Council Plan, and in particular priority 4: Inclusive and Adaptable, with the Council seeking to provide high quality and adaptable services that deliver value for money. .................................... Laurence Slavin Chief Officer - Resources Date: 6 November 2025 Person to Contact: Andi Priestman, Shared Service Manager – Audit & Fraud E-mail: andi.priestman@west-dunbarton.gov.uk Appendices: 2024/25 Annual Audit Plan – Progress to 31 October 2025 (Appendix 1) Status of Internal Audit Action Plans at 30 September 2025 (Appendix 2) Internal Audit Reports - Copies available on request Wards Affected: All wards Page 12
Page 13
2024-2025 Internal Audit Annual Audit Plan – Progress to 31 October 2025 Item 5 Appendix 1 Audit/Status Not Started Planning Fieldwork Fieldwork Complete Draft Report Final Report Date Reported to Audit Committee Risk-Based Reviews Void Management June 2025 Housing Repairs and Maintenance June 2025 Budgetary Control Participatory Budgeting Deferred to future audit plan. Corporate Procurement Regularity Audits Payroll High Earners – Quarterly Review Quarterly exercise is underway. Residential Care Homes – Overtime Included in Payroll High Earners quarterly review exercise. Other Work Integration Joint Board – Internal Audit Service The 2024/25 audit plan is complete. Valuation Joint Board – Internal Audit Service The 2024/25 audit plan is complete. Leisure Trust – Internal Audit Service The 2024/25 audit plan is complete. National Fraud Initiative Matches for the 2024 Exercise have now been received and investigations are underway. Completion of 23/24 Audit Plan Audits Completed: Debt Recovery; UK Shared Prosperity Fund; Commercial Waste Income Billing and Collection. Page 13
Page 14
Page 14
Page 15
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLANS AT 30 SEPTEMBER 2025 Summary: Section 1 Summary of Management Actions due for completion by 30/09/2025 There were 14 actions due for completion between 1 July and 30 September 2025, 10 of which have been reported as completed by management and the completion date for 3 actions has been revised. For one action, a management update is overdue. Section 2 Summary of Current Management Actions Plans at 30/09/2025 At 30 September 2025 there were no audit reports delayed due to management not finalising the action plan within agreed timescales. Section 3 Current Management Actions at 30/09/2025 At 30 September 2025 there were 27 current audit action points. Section 4 Analysis of Missed Deadlines At 30 September 2025 there were 14 audit action points where the original agreed deadline has been missed. Section 5 Summary of Action Plan Points by Audit Year Item 5 Appendix 2 Page 15
Page 16
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS SUMMARY OF ACTION PLANS DUE FOR COMPLETION BY 30.09.2025 SECTION 1 2 Strategic Area No. of Actions Due No. of Actions Completed Deadline missed Revised Date set* Update overdue* Education 1 1 Housing and Employability 13 10 3 Total 14 10 3 1 * These actions are included in the Analysis of Missed Deadlines – Section 4 Page 16
Page 17
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS SUMMARY OF CURRENT ACTION PLANS AT 30.09.2025 SECTION 2 3 CURRENT ACTIONS BY STRATEGIC AREA Roads and Neighbourhood Due for completion December 2025 1 Total Actions 1 Education Due for completion September 2025 1 Total Actions 1 Housing & Employability Due for completion November 2025 1 Due for completion December 2025 10 Due for completion January 2026 1 Due for completion February 2026 1 Due for completion March 2026 8 Due for completion June 2026 1 Due for completion July 2026 3 Due for completion August 2026 1 Total Actions 25 Total current actions: 27 Page 17
Page 18
Page 18
Page 19
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 4 Status Key On track Complete Overdue – update required Missed original due date Current Internal Audit Action Plans CSA Education Procedures (Report Issued May 2024) Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/231 Adequacy of School Fund Procedures A review of the procedures will be undertaken and updated to reflect up to date practice and provide sufficient guidance to staff involved in maintaining and managing school funds. A copy of the updated school fund procedures will be disseminated to Heads of establishments. 31-Mar-2025 30-Sep-2025 Senior Education Officer Chief Officer – Education, Learning and Attainment UK Shared Prosperity Fund Assurance Review (Report Issued June 2024) Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/237 Inadequate policies and procedures to support closure of the fund (Amber) Management are in regular discussions with Government officials about continuity of UKSP Funds. Should these discussions prove to be unsuccessful and there is no further funding from this source, WDC has a full set of HR policies relating to staff terms and conditions and processes for dealing with the loss of funding. We will begin to implement the appropriate course of action three months in advance of the fund closing. As an update, the funding has been extended into Year 4 (25/26) and a report will be presented to IRED Committee in February 2025 on further year funding. 31-Dec-2024 31-Dec-2025 Chief Officer Housing & Employability/ Chief Officer, Resources Chief Executive Page 19
Page 20
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 5 Status Key On track Complete Overdue – update required Missed original due date Void Management (Report Issued May 2025) Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/255 /3 Adequacy of Tenant Rechargable Repairs Process (Amber) Review recharge process to include guidance for staff to follow should previous tenant query/ dispute recharge amount invoiced for and be incorporated into Void Procedure and Recharge processes. 30-Jun-2025 31-Dec-2025 Maintenance Manager/ Housing Operations Manager Chief Officer Housing and Employability IAAP/255 /4 Adequacy of Tenant Rechargable Repairs Process (Amber) Design and implement new PowerBi clear out report. 31-Aug-2025 31-Dec-2025 Housing Operations Manager Chief Officer Housing and Employability IAAP/256 /3 Adequacy of Job Costing Process (Amber) Continue to report void management data at appropriate forums including Building Services Board. 31-Mar-2026 31-Mar-2026 Housing Operations Manager Chief Officer Housing and Employability IAAP/257 /3 Lack of monitoring and authorisation of repairs costs to void properties (Amber) Implement any necessary changes to the variation process and agreed authorisation processes. 31-Jul-2025 31-Jul-2025 Housing Operations Manager Chief Officer Housing and Employability IAAP/258 /3 Ensuring Value for Money when using external contractors (Amber) If appropriate arrange and carryout a full tender exercise to engage a void property contractor from an existing framework or arrange an open tender exercise. 30-Nov-2025 30-Nov-2025 Contracts Manager Chief Officer Housing and Employability Page 20
Page 21
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 6 Status Key On track Complete Overdue – update required Missed original due date Housing Repairs and Maintenance (Report Issued May 2025) Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/263 /1 Adequacy of Housing Client Function (Red) Carry out a review of the Client Function to identify any areas that require improvement to ensure quality, value for money repair and maintenance services are provided. 31-Jul-2025 31-Mar-2026 Building Services Manager Chief Officer Housing and Employability IAAP/263 /2 Adequacy of Housing Client Function (Red) Implement any necessary Client Function changes identified. 31-Mar-2026 31-Mar-2026 Building Services Manager Chief Officer Housing and Employability IAAP/263 /3 Adequacy of Housing Client Function (Red) Develop Building Services 2025/2026 improvement action plan to include appropriate financial management, service costs recovery and budget management actions. 30-Jun-2025 31-Dec-2025 Building Services Manager Chief Officer Housing and Employability IAAP/263 /4 Adequacy of Housing Client Function (Red) Present Building Services 2025/2026 improvement action plan to the Building Service Board for approval. 30-Jun-2025 31-Dec-2025 Building Services Manager Chief Officer Housing and Employability IAAP/263 /5 Adequacy of Housing Client Function (Red) Complete actions within Building Services 2025/2026 action plan. 31-Mar-2026 31-Mar-2026 Building Services Manager Chief Officer Housing and Employability IAAP/263 /6 Adequacy of Housing Client Function (Red) Carry out a review of variation procedure and authorisation limits and implement any necessary changes ensuring robust procedures are in place and provide value for money services. 30-Jun-2025 31-Dec-2025 Contracts Co- ordinator/ Support Services Co-ordinator Chief Officer Housing and Employability IAAP/264 /5 Lack of Checking of Overtime Claims (Red) Monitor and review revised processes to ensure effectiveness. 31-Jul-2025 31-Jul-2025 Building Services Manager Chief Officer Housing and Employability IAAP/265 /1 Adequacy of Stock Control Procedures (Amber) Complete the procurement of an appropriate barcoding hardware and software solution. 30-Jun-2025 30-Jun-2026 Contracts Manager Chief Officer Housing and Employability Page 21
Page 22
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 7 Status Key On track Complete Overdue – update required Missed original due date Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/265 /2 Adequacy of Stock Control Procedures (Amber) Implement the procurement of an appropriate barcoding hardware and software solution. 31-Jul-2026 31-Jul-2026 Contracts Co- ordinator Chief Officer Housing and Employability IAAP/265 /3 Adequacy of Stock Control Procedures (Amber) Present a decision paper to the IHMS Project Board to approve development of the automatic reordering module. 30-Jun-2025 31-Dec-2025 IHMS Change Officer Chief Officer Housing and Employability IAAP/265 /4 Adequacy of Stock Control Procedures (Amber) Following approval, complete necessary work implement, test and go live on QL system. 31-Aug-2026 31-Aug-2026 IHMS Change Officer Chief Officer Housing and Employability IAAP/265 /5 Adequacy of Stock Control Procedures (Amber) Fully implement phase 2 of the review of Building Services structure in warehouse services. 31-May-2025 28-Feb-2026 Contracts Co- ordinator Chief Officer Housing and Employability IAAP/265 /9 Adequacy of Stock Control Procedures (Amber) Training will be provided and distribution of the new procedures to all stores staff will be recorded in a register. Staff will sign the register to confirm receipt of the procedures. 31-May-2025 30-Sep-2025 Contracts Co- ordinator Chief Officer Housing and Employability IAAP/266 /1 Lack of Recovery Plan to reduce overspend (Amber) Develop a cost recovery plan for 2025/2026 and gain approval of the plan from the Building Services Board. 30-Jun-2025 31-Dec-2025 Building Services Manager Chief Officer Housing and Employability IAAP/266 /2 Lack of Recovery Plan to reduce overspend (Amber) Complete actions in the cost recovery plan for 2025/2026 reporting progress at the Building Services Board and other appropriate forums. 31-Mar-2026 31-Mar-2026 Building Services Manager Chief Officer Housing and Employability IAAP/266 /3 Lack of Recovery Plan to reduce overspend (Amber) Drive down tenant and resident reactive repair demand in line with the criteria within the new repairs policy. 31-Mar-2026 31-Mar-2026 Building Services Manager Chief Officer Housing and Employability IAAP/267 /3 Adequacy of monitoring of Schedule of Rates for Specifying and Controlling Repairs & Maintenance Work (Amber) Implement any necessary changes identified in the variation processes. 31-Jul-2025 31-Jul-2025 Maintenance Manager Chief Officer Housing and Employability Page 22
Page 23
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 8 Status Key On track Complete Overdue – update required Missed original due date Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/267 /4 Adequacy of monitoring of Schedule of Rates for Specifying and Controlling Repairs & Maintenance Work (Amber) Reduce the average percentage of variation on non emergency reactive repairs by 5% in 2025/2026 compared the level in 2024/2025. 31-Mar-2026 31-Mar-2026 Maintenance Manager Chief Officer Housing and Employability IAAP/268 /4 Lack of Post Inspections (Amber) Review post inspection targets to ensure these are effective and repair standards are being met / improved. 30-Sep-2025 30-Sep-2025 Maintenance Manager Chief Officer Housing and Employability IAAP/269 /1 Inefficient Allocation of Resources (Amber) Include an action in the Building Services 2025/2026 improvement action plan to have an effective imprest stock provision in place. 30-Jun-2025 31-Dec-2025 Building Services Manager Chief Officer Housing and Employability IAAP/269 /2 Inefficient Allocation of Resources (Amber) Develop alternative scheduling and appointment system to replace DRS. 31-Jul-2025 31-Jul-2026 IHMS Change Officer Chief Officer Housing and Employability IAAP/269 /3 Inefficient Allocation of Resources (Amber) Seek approval from Building Services Board to implement new system. 31-Aug-2025 31-Aug-2025 Building Services Manager Chief Officer Housing and Employability IAAP/269 /4 Inefficient Allocation of Resources (Amber) Implement new scheduling and appointment system. 30-Sep-2025 31-Jul-2026 Building Services Manager/IHMS Change Officer Chief Officer Housing and Employability IAAP/270 /2 Lack of Risk Assessments for Staff with Secondary Employment (Amber) Review and if necessary complete risk assessments for employees that have informed management of secondary paid work. 31-Aug-2025 31-Aug-2025 Building Services Co-ordinators Chief Officer Housing and Employability IAAP/271 /1 Adequacy of Monitoring of Vehicle Usage (Amber) Develop a formal fuel emission and tracking guidance procedure and rollout for use within service. 30-Sep-2025 30-Sep-2025 Contracts Manager Chief Officer Housing and Employability IAAP/271 /2 Adequacy of Monitoring of Vehicle Usage (Amber) Continue to monitor automated reports from webfleet system and take appropriate action in line with Fuel Emission and Tracking Protocol and appropriate Council policies. 31-Mar-2026 31-Mar-2026 Maintenance Manager/ Contracts Manager Chief Officer Housing and Employability Page 23
Page 24
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS CURRENT ACTION PLANS AT 30.09.2025 SECTION 3 9 Status Key On track Complete Overdue – update required Missed original due date Code Agreed Action Status Original Due Date Due Date Assigned To Managed By IAAP/273 /1 Lack of Standard Operating Procedure Manual (Amber) Review procedure file within x-drive to identify if there are gaps in available procedures that are not available within QL to ensure team members have appropriate guidance to effectively complete tasks. 30-Jun-2025 30-Sep-2025 Maintenance Co- ordinators Chief Officer Housing and Employability IAAP/273 /2 Lack of Standard Operating Procedure Manual (Amber) Develop and add any necessary procedures and processes to procedures file within the x-drive. 31-Dec-2025 31-Dec-2025 Maintenance Co- ordinators Chief Officer Housing and Employability IAAP/274 /2 Compliance with HMRC Benefit in Kind Guidelines (Amber) Review process for homestart personal use disclaimer protocol to ensure this is fit for purpose and exercise is carried out annually. 31-Jul-2025 31-Jul-2025 Projects Manager Chief Officer Housing and Employability IAAP/274 /3 Compliance with HMRC Benefit in Kind Guidelines (Amber) Carry out a review of the homestart protocol with workforce, TUs and transport service ensuring this remains fit for purpose. 31-Jan-2026 31-Jan-2026 Maintenance Manager/Project s Manager Chief Officer Housing and Employability Page 24
Page 25
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS ANALYSIS OF MISSED DEADLINES AT 30.09.2025 SECTION 4 Status Key 10 On track Complete Overdue – update required Missed original due date –new date set Report Agreed Action Original Due Date Revised Date Management Comments CSA Education Procedures (May 2024) Adequacy of School Fund Procedures A review of the procedures will be undertaken and updated to reflect up to date practice and provide sufficient guidance to staff involved in maintaining and managing school funds. A copy of the updated school fund procedures will be disseminated to Heads of establishments. 31-Mar-2025 31-May-2025 30-Sep-2025 The policy has now been drafted and will be discussed with Heads of Establishment at the September Business Meeting. Void Management (May 2025) Adequacy of Tenant Rechargable Repairs Process (Amber) Review recharge process to include guidance for staff to follow should previous tenant query/dispute recharge amount invoiced for and be incorporated into Void Procedure and Recharge processes. 30-Jun-2025 31-Aug-2025 31-Dec-2025 Review is underway as part of Void working group but deadline required to be extended. Void Management (May 2025) Adequacy of Tenant Rechargable Repairs Process (Amber) Design and implement new PowerBi clear out report. 31-Aug-2025 31-Dec-2025 PowerBi report has been developed and training completed with managers within Housing Operations. Discussed at IHMS Board, target date requires to be extended to 31/12/25 as IHMS team moving to Granicus forms, so unable to get improvements implemented until this happens. Housing Repairs and Maintenance (May 2025) Adequacy of Housing Client Function (Red) Carry out a review of the Client Function to identify any areas that require improvement to ensure quality, value for money repair and maintenance services are provided. 31-Jul-2025 31-Dec-2025 Client function within building services discussed at BS Board but realistically will take another 3-6 months to embed. Housing Repairs and Maintenance (May 2025) Adequacy of Housing Client Function (Red) Develop Building Services 2025/2026 improvement action plan to include appropriate financial management, service costs recovery and budget management actions. 30-Jun-2025 31-Dec-2025 Client function within building services discussed at BS Board but realistically will take another 3-6 months to embed. Page 25
Page 26
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS ANALYSIS OF MISSED DEADLINES AT 30.09.2025 SECTION 4 11 Status Key On track Complete Overdue – update required Missed original due date Report Agreed Action Original Due Date Revised Date Management Comments Housing Repairs and Maintenance (May 2025) Adequacy of Housing Client Function (Red) Present Building Services 2025/2026 improvement action plan to the Building Service Board for approval. 30-Jun-2025 31-Dec-2025 Client function within building services discussed at BS Board but realistically will take another 3-6 months to embed. Housing Repairs and Maintenance (May 2025) Adequacy of Housing Client Function (Red) Carry out a review of variation procedure and authorisation limits and implement any necessary changes ensuring robust procedures are in place and provide value for money services. 30-Jun-2025 31-Dec-2025 Client function within building services discussed at BS Board but realistically will take another 3-6 months to embed. Housing Repairs and Maintenance (May 2025) Inefficient Allocation of Resources (Amber) Include an action in the Building Services 2025/2026 improvement action plan to have an effective imprest stock provision in place. 30-Jun-2025 31-Dec-2025 Work is ongoing but should be in place within 3-6 months. Housing Repairs and Maintenance (May 2025) Inefficient Allocation of Resources (Amber) Develop alternative scheduling and appointment system to replace DRS. 31-Jul-2025 31-Jul-2026 Go live date revised to July 2026. Agreed that this was required due to testing, training and implementation required Housing Repairs and Maintenance (May 2025) Inefficient Allocation of Resources (Amber) Implement new scheduling and appointment system. 30-Sep-2025 31-Jul-2026 Go live date revised to July 2026. Agreed that this was required due to testing, training and implementation required Housing Repairs and Maintenance (May 2025) Adequacy of Stock Control Procedures (Amber) Fully implement phase 2 of the review of Building Services structure in warehouse services. 31-May-2025 01-Aug-2025 28-Feb-2026 It has been necessary to extend completion date due to delays within Job Evaluation in terms of reviewing the role profile of warehouse assistant. The posts are only now becoming available for recruitment. This should be completed through SWITCH and any necessary recruitment by the end of February 2026. Housing Repairs and Maintenance (May 2025) Adequacy of Stock Control Procedures (Amber) Complete the procurement of an appropriate barcoding hardware and software solution. 30-Jun-2025 30-Jun-2026 In-house option being taken forward and target set for June 2026. Page 26
Page 27
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLAN POINTS ANALYSIS OF MISSED DEADLINES AT 30.09.2025 SECTION 4 12 Status Key On track Complete Overdue – update required Missed original due date Report Agreed Action Original Due Date Revised Date Management Comments Housing Repairs and Maintenance (May 2025) Adequacy of Stock Control Procedures (Amber) Present a decision paper to the IHMS Project Board to approve development of the automatic reordering module. 30-Jun-2025 31-Dec-2025 The process is currently being reviewed and decision paper will be presented to Project Board by end of December 2025. Housing Repairs and Maintenance (May 2025) Lack of Recovery Plan to reduce overspend (Amber) Develop a cost recovery plan for 2025/2026 and gain approval of the plan from the Building Services Board. 30-06-2025 31-Dec-2025 Further work is required to undertake relevant analysis and prepare recovery plan for approval which is now anticipated to be by 31 December 2025. Page 27
Page 28
REPORT TO AUDIT COMMITTEE ON STATUS OF INTERNAL AUDIT ACTION PLANS SUMMARY OF ACTIONS BY AUDIT YEAR SECTION 5 13 Status at 30 September 2025 Current actions by GradeAudit Year No of Agreed Actions No of actions complete Red Amber Green* 2020/2021 25 25 0 0 0 2021/2022 51 50 0 0 1 2022/2023 51 48 0 0 3 2023/2024 62 48 0 2 12 2024/2025 80 42 6 19 13 Total 269 213 6 21 29 * Green actions are within the Council’s risk appetite and are therefore not included in Audit Committee reports. Page 28
Page 29
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - Resources Audit Committee - 10 December 2025 ___________________________________________________________________ Subject: 2025/26 Internal Audit Annual Strategy and Plan 1. Purpose 1.1 The purpose of this report is to advise members of the planned programme of work for the Internal Audit Section for the year 2025/26. 2. Recommendations 2.1 It is recommended that the Committee approve the 2025/26 Audit Plan. 3. Background 3.1 The Public Sector Internal Audit Standards include the requirement for the Chief Internal Auditor to prepare a risk-based plan to determine the priorities of the internal audit activity, consistent with the organisation’s goals. 4. Main Issues 4.1 The audit universe contains all areas that have been identified for review and an assessment has been undertaken of the risk relating to each area based on a number of criteria. Account has also been taken of the risks identified in the Council’s risk registers and risks identified by external scrutiny bodies through local scrutiny arrangements. 4.2 It is intended that audit work will be focused on areas of greatest risk taking into account management’s own view of risk and meetings have been held with Chief Officers as appropriate. Each area has been assessed against a broad range of risk criteria and a risk score has been generated based on probability factors such as current control environment, results of last audit and time since last audit. 4.3 The audit plan also includes the carry forward of the completion of fieldwork for audits from 2024/25. 4.4 The Audit Plan also includes the activity of the Corporate Fraud Team and includes an allocation of days to provide the Internal Audit Service to the WD Integration Joint Board, the WD Leisure Trust and the Valuation Joint Board. 4.5 Internal Audit monitors delivery of the plan continuously during the year using a number of performance indicators. Progress is reported to members on a regular basis. Item 6 Page 29
Page 30
4.6 Outlined below are the current risk factors influencing our proposed audit coverage for 2025/26: Budgetary Control - The Council’s regular Financial Update report sets out the scale of the anticipated savings options required in current and future years whilst there is a continued need for the Council to meet increases in expenditure arising from inflation and service delivery pressures. Internal Audit will review the adequacy and effectiveness of the budgetary control processes to ensure that members and officers are provided with relevant, reliable and timely management information in relation to the budget process. West Dunbartonshire HSCP works closely with colleagues in the acute service across NHS Greater Glasgow & Clyde to ensure that service users are discharged to their home as soon as services are available in the community. Internal Audit will review the current arrangements in place to ensure these are adequate and effective. Internal Audit will review the adequacy and effectiveness of processes in place to ensure commercial and industrial property rental income is being collected promptly and is properly accounted for. As part of the annual audit planning process, corporate procurement is a key risk area that is reviewed each year. For 2025/26 Internal Audit will carry out quarterly checks on Corporate Purchase Card expenditure to ensure compliance with relevant policies and procedures. Regularity audits will be carried out in relation to high earners, section payments and Education control self-assessment exercise. Risk-based planning will be undertaken to prepare 2025/26 audit plans in relation to the West Dunbartonshire Integration Joint Board, West Dunbartonshire Leisure Trust and the Dunbartonshire and Argyll and Bute Valuation Joint Board. 4.7 The draft 2025/26 Internal Audit Strategy and Plan is included at Appendix 1. There are no significant threats to the independence of the internal audit activity, such as inappropriate scope or resource limitations. The Plan contains contingency provision that will be utilised during the year in response to unforeseen work demands that may arise e.g. special investigations and provision of ad hoc advice. The plan also includes a balance of days required to complete additional fieldwork from the 2024/25 audit plan. 4.8 The risk scoring system is maintained on a real-time basis and is altered as circumstances change. Regular reviews of the risk scores allow Internal Audit to address the changing risk exposure of the organisation more effectively and ensure audit effort is focused on those areas identified as higher risk. 5. Personnel Implications 5.1 There are no personnel issues with this report. Page 30
Page 31
6. Financial and Procurement Implications 6.1 There are neither financial nor procurement implications arising directly from this report. 7. Risk Analysis 7.1 The Plan has been constructed taking cognisance of the risks associated with major systems. Consultation with relevant Chief Officers has been carried out to ensure that risks associated with delivering the Council’s objectives have been considered. 8. Equalities Impact Assessment (EIA) 8.1 There are no issues. 9. Consultation 9.1 This report has been subject to consultation with appropriate Chief Officers. 10. Strategic Assessment 10.1 This report relates to all five of the Council’s Strategic Priorities. Laurence Slavin Chief Officer - Resources Date: 6 November 2025 Person to contact Andi Priestman, Shared Service Manager – Audit & Fraud Email: andi.priestman@west-dunbarton.gov.uk Appendix 1: Draft 2025/26 Internal Audit Strategy and Plan Background Papers: None Wards Affected: All wards Page 31
Page 32
Page 32
Page 33
2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN 1. Introduction 1.1 The Global Internal Audit Standards (UK Public Sector) set out the requirement for the Shared Service Manager – Audit & Fraud to prepare a risk-based audit plan to determine the priorities of the internal audit activity, consistent with the organisation’s goals. 1.2 The Shared Service Manager – Audit & Fraud must review and adjust the plan as necessary in response to changes in the organisation’s business, risks, operations and priorities. 1.3 The audit plan must incorporate or be linked to a strategic or high-level statement of how the Internal Audit Service will be delivered and developed in accordance with the Internal Audit Charter and how it links to the organisational objectives and priorities. 1.4 The strategy shall be reviewed on an annual basis as part of the audit planning process. 2. Internal Audit Objectives 2.1 The purpose of Internal Audit, as defined within Global Internal Audit Standards (UK Public Sector) is to ‘strengthen the organisation’s ability to create, protect, and sustain value by providing the board and management with independent, risk-based and objective assurance, advice, insight and foresight’. 2.2 The primary aim of the internal audit service is to provide assurance services which requires the Chief Internal Auditor to provide an annual internal audit opinion based on an objective assessment of the framework of governance, risk management and control. 2.3 The internal audit service also provides advisory services, generally at the request of the organisation, with the aim of improving governance, risk management and control and contributing to the overall opinion. 2.4 The internal audit service supports the Chief Officer Resources in his role as West Dunbartonshire Council’s (the Council) Section 95 Officer. 3. Risk Assessment and Audit Planning 3.1 The internal audit approach to annual audit planning is risk-based and all areas which may be subject to audit review are contained within an Audit Universe which is subject to formal review, at least annually. 3.2 The risk scoring system is maintained on a real-time basis and is altered as circumstances change. Regular reviews of the risk scores allow Internal Audit to address the changing risk exposure of the organisation more effectively and ensure audit effort is focused on those areas identified as higher risk. Item 6 Appendix 1 Page 33
Page 34
2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN Appendix 1 3.3 The Audit Universe is risk assessed each year to determine the Annual Audit Plan and ensure that suitable audit time and resources are devoted to reviewing the more significant areas of risk. Each area within the Audit Universe is assessed for impact against a number of broad risk categories as follows: Strategy Risks associated with the setting and achievement of strategic objectives. Economy Risks associated with the economy in which the Council operates. Reputation Risks associated with threats to the Council’s name and standing in the sector. Customer Risks associated with customer relationships. Legal/Regulatory Risks associated with the requirement to comply with a wide range of statute. Financial Risks associated with financial loss or inefficiency. Technology Risks associated with application systems, their integrity, security and development. Management Information Risks associated with the provision of information for decision- making purposes. Human Resources Risks associated with people, e.g. recruitment, succession, development, motivation and morale etc. Operations Risks associated with the business operating process. Business Continuity/Resilience Risks associated with disaster scenarios which would threaten the continuing operation of the Council. Security Risks associated with security over customer and the Council’s assets. Stakeholder Risks associated with management of stakeholder expectations (e.g. Government or local communities) Fraud Risks associated with asset misappropriation, corruption and financial statement fraud. 3.4 Account has also been taken of the risks identified in the Council’s Risk Registers and risks identified by external scrutiny bodies through local scrutiny arrangements. 3.5 There will be regular ongoing discussion with External Audit to ensure respective audit plans are reviewed as circumstances change in order to minimise duplication of effort and maximise audit coverage for the Council. 4 Service Delivery 4.1 The provision of the internal audit service is through a directly employed in-house team. The Shared Service Manager – Audit & Fraud is provided through a shared management arrangement with Inverclyde Council. 4.2 In relation to the total staff days allocated to the 2025/2026 plan, a resource allocation spreadsheet is completed for each member of staff which is split between annual leave, public holidays, training days, general administration and operational plan days. Page 34
Page 35
2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN Appendix 1 The combined operational plan is 645 days which will be resourced as follows: Team Member Plan Days Lead Internal Auditor (0.5 FTE)* 55 Internal Auditor (1.0 FTE)* 32 Internal Auditor (0.5 FTE) 90 Audit Assistant 108 Corporate Fraud Officer 180 Corporate Fraud Officer 180 Total Plan Days 645 * The Lead Internal Auditor and Internal Auditor posts are currently vacant. Options are currently being progressed to fill these vacancies by 1 February 2026. The Shared Service Manager – Audit & Fraud does not directly carry out the assignments included in the annual audit plan but provides the quality review and delivery oversight of the overall plan. As such, no direct time is included within the plan. Where there are any resource issues which may impact on delivery of the plan, this will be reported to the Audit Committee at the earliest opportunity. 4.3 Given the range and complexity of areas to be reviewed it is important that suitable, qualified, experienced and trained individuals are appointed to internal audit positions. The Global Interrnal Audit Standards (UK Public Sector) requires that the Chief Internal Auditor must hold a professional qualification such as CMIIA (Chartered Internal Auditor), CCAB or equivalent and be suitably experienced. 4.4 Internal audit staff members identify training needs as part of an appraisal process and are encouraged to undertake appropriate training, including in-house courses and external seminars as relevant to support their development. All training undertaken is recorded in a personal training record for CPD purposes. 4.5 Internal audit staff members require to conform to the Code of Ethics of the professional body of which they are members and to the Code of Ethics included within the Global Interrnal Audit Standards (UK Public Sector). An annual declaration is undertaken by staff in relation to specific aspects of the Code. 4.6 Following each review, audit reports are issued in draft format to agree the accuracy of findings and agree risk mitigations. Copies of final audit reports are issued to the relevant Chief Officer and Service Manager responsible for implementing the agreed action plan. A copy of each final audit report is also provided to External Audit. 4.7 The overall opinion of each audit report feeds into the Internal Audit Annual Report and Assurance Statement which is presented to the Audit Committee and is used by the s95 Officer in the preparation of the Annual Governance Statement. Page 35
Page 36
2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN Appendix 1 5 Proposed Audit Coverage 2025-2026 5.1 The proposed audit coverage is set out in the table below. This includes a range of risk based reviews, limited scope financial reviews and regularity audits. 5.2 The Plan contains a contingency provision that will be utilised during the year in response to unforeseen work demands that arise e.g. special investigations and provision of ad hoc advice. Audit Area Strategic Area Risk Score Staff Days Risk-Based Reviews Budgetary Control (c/f 24/25) Corporate 7105 30 Care At Home - Delayed Discharge Arrangements HSCP 6800 25 Estates – Commercial and Industrial Property Rents and Leases Resources 6256 25 Total 80 Regularity Audits High Earners – Quarterly check Corporate N/A 20 Section Payments HSCP N/A 20 Education Control Self-Assessment Education N/A 20 Corporate Purchase Cards – Quarterly check Corporate N/A 20 Total 80 Corporate Governance Reviews Annual Governance Statement (2024/25) Corporate - 5 Total 5 Corporate Fraud Activity National Fraud Initiative Corporate - 150 Fraud Referrals including Joint Working - - 100 Whistleblowing and Other Investigations - - 90 Liaison with DWP - - 10 Fraud Awareness Training Corporate - 10 Total 360 Other Work Audit follow up Corporate - 10 IJB – Internal Audit Service - - 20 VJB – Internal Audit Service - - 15 Leisure Trust – Internal Audit Service - - 15 Contingency - - 10 Completion of 2024-2025 Audit Plan - - 50 Total 120 Total Staff Days for 2025/26 645 Page 36
Page 37
2025/26 INTERNAL AUDIT ANNUAL STRATEGY AND PLAN Appendix 1 6 Quality and Performance 6.1 The Global Interrnal Audit Standards (UK Public Sector) require each internal audit service to maintain an ongoing quality assurance and improvement programme based on an annual self-assessment against the Standards, supplemented at least every five years by a full independent external assessment. 6.2 In addition, the performance of Internal Audit continues to be measured against key service targets focussing on quality, efficiency and effectiveness. For 2025/2026 these have been set as follows: Measure Description Target 1. Draft Report Percentage of draft reports issued within 3 weeks of completion of fieldwork. 90% 2. Final Report Percentage of final reports issued within 2 weeks of issue of draft report. 90% 3. Audit Plan Delivery Percentage of audits completed v planned. 85% 4. Audit Budget Percentage of audits completed within budgeted days. 80% 5. Audit Recommendations Percentage of audit recommendations agreed. 90% 6. Action Plan Follow Up Percentage of action plans followed up – Internal and External Audit. 100% 7. Customer Feedback Percentage of respondents who rated the overall quality of internal audit as satisfactory or above. 100% 8. NFI recommended matches Percentage of National Fraud Initiative high risk matches investigated within timescales. 100% 9. DWP liaison Percentage of cases referred to/ actioned for DWP within DWP timescales. 100% 10. Staff compliance with CPD Number of training hours undertaken to support CPD 80 11. Management engagement Number of meetings with CMT and senior management as appropriate 1 per quarter 6.3 Actual performance against targets will be included in the 2025/26 Internal Audit Annual Assurance Report. Page 37
Page 38
Page 38
Page 39
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - Resources Audit Committee - 10 December 2025 Subject: Public Interest Disclosures and other Internal Audit Investigations 1 April to 31 October 2025 1. Purpose 1.1 The purpose of this report is to advise Committee of the outcome of investigations into allegations and disclosures in line with public interest disclosure and business irregularities policies received by Internal Audit between 1 April and 31 October 2025. 2. Recommendations 2.1 It is recommended that Members note the content of this report. 3. Background 3.1 A disclosure in the public interest is where a concern is raised by a Council employee about a danger or illegality that has a public interest aspect to it. A confidential reporting facility is managed by Internal Audit as part of the Council’s Public Interest Disclosure Policy. Internal Audit maintains a central record of all concerns raised under the Public Interest Disclosure Policy. All such disclosures are investigated by Internal Audit, including liaising with Services and HR as appropriate. 3.2 Members of the public can also contact Internal Audit to raise issues of concern and such matters are investigated as appropriate, although they are not regarded as public interest disclosures in terms of legislation. 4. Main Issues Public Interest Disclosure Cases 4.1 There were 5 outstanding cases from the previous report to Audit Committee on 11 June which require an update to this meeting. Ref/ Date Service Area Detail Status 01/0424 14/0924 21/1024 23/1024 27/1224 09.12.24 Roads & Neighbourhood Drug misuse by employees whist on duty. Referred to Service – closed due to lack of specific information relating to employees. Service is however currently reviewing the drug testing policy with HR. Item 8 Page 39
Page 40
Ref/ Date Service Area Detail Status 19/1024 23.10.24 Housing Potential breach of code of conduct/social media policy. Referred to Service – investigated and appropriate management action undertaken. 25/1124 29.11.24 Housing Service Referral - Potential breach of working practices. Closed - Incorporated into Audit Plan 2024/25. 30/1224 16.12.24 Housing Misuse of Council vehicle. Closed – hire vehicle used by employee so unable to investigate. 33/1224 31.12.24 HSCP Allegation of misuse of corporate purchase card. Closed – misuse identified and report issued to management with recommendations which have been actioned by management. 4.2 There were 16 new disclosures investigated during the period 1 April to 31 October 2025 as follows: Ref/ Date Service Area Detail Status 03/0425 29.04.25 WD Leisure Trust Allegation of Drug Misuse Closed – referred to Police Scotland. 08/0625 04.06.25 HSCP Complaint about employee behaviour. Closed – referred to Service and dealt with as a complaint. 11/0625 17/0725 24.07.25 Roads and Neighbourhood Allegation of misuse of council vehicle and not working contracted hours. Ongoing – joint investigation being carried out between Audit & Fraud and HR. 14/0725 15/0725 11.07.25 HSCP Complaint about employee behaviour. Closed – referred to Service as dealt with as a complaint. 19/0825 14.08.25 Housing Allegation of inappropriate behaviour of employee towards colleagues and members of the public. Ongoing – Service investigation is being progressed. Page 40
Page 41
Ref/ Date Service Area Detail Status 20/0825 26.08.25 Housing Allegation of misuse of council vehicle and fraudulent overtime claims. Closed – no misuse or fraud established. 22/0825 26.08.25 Roads and Neighbourhood Allegation of fraudulent/ irregular working practices and potential health and safety breaches. Ongoing – joint investigation being progressed between Audit & Fraud and HR. 23/0825 26.08.25 Roads and Neighbourhood Allegation of misuse of vehicle by employee on non-working day. Closed – no fraud established. 24/0825 26.08.25 HSCP Allegation of inappropriate use of council vehicle. Closed – no fraud established. 26/0825 31.08.25 HSCP Allegation of employee being under influence of drugs whilst at work. Closed – no evidence to substantiate allegation. 27/0925 01.09.25 Roads and Neighbourhood Allegation of employee being under influence of alcohol whilst at work. Closed – no evidence to substantiate allegation. 28/1025 03.10.25 Housing Potential misuse of council vehicle and theft of council materials Referred to service – investigation ongoing. 29/1025 10.10.25 HSCP Complaint about employee behaviour. Closed – links to previous referrals. INV-14/0725 refers. 32/1025 31.10.25 Housing Potential misuse of Council vehicle. Closed – no fraud detected. Page 41
Page 42
4.3 Activity relating to public interest disclosure for recent reporting periods is as follows: Period No. of Cases 1st January 2019 to 30th June 2019 5 1st July 2019 to 30th June 2020 8 1st July 2020 to 31st December 2020 4 1st January 2021 to 18th August 2021 15 19th August 2021 to 31st January 2022 7 1st February 2022 to 15th July 2022 7 16th July 2022 to 18th January 2023 5 19th January to 18th July 2023 19 19th July 2023 to 24th January 2024 10 27th January to 31st October 2024 18 1st November 2024 to 31st March 2025 11 1st April to 31st October 2025 16 Other investigations (non public interest disclosure cases) 4.4 There were 3 outstanding other referrals investigated by Internal Audit during the period 1st April to 31st October 2025: Ref/ Date Service Area Detail Status 36/0125 29.01.25 Roads and Neighbourhood Allegation of misuse of council facilities and theft of council resources for personal gain. Investigation has been undertaken by Service. No fraud identified but implementation of recommendations from previous investigation are ongoing. 37/0225 19.02.25 Roads and Neighbourhood Allegation of misuse of council vehicle. Closed – no misuse identified. 38/0225 19.02.25 Citizens, Culture and Facilities Management Allegation of theft of council materials. Closed – no fraud detected. Page 42
Page 43
4.5 There were 12 new referrals investigated during the period 1 April to 31 October 2025 as follows: Ref/ Date Service Area Detail Status 01/0425 19.04.25 Roads and Neighbourhood Allegation of misuse of council facilities and poor working practices. Ongoing - Linked to 36/0125. Actions to implement previous recommendations are ongoing. 06/0525 29.05.25 Roads and Neighbourhood Allegation that employee takes excessive breaks from work. Ongoing - Service investigation complete and report being prepared for management. 07/0625 03.06.25 Roads and Neighbourhood Allegation that employees take backhanders to remove rubbish. Closed – insufficient information provided in the referral to investigate. 09/0625 05.06.25 Roads and Neighbourhood Allegation that employee takes excessive breaks from work. Closed – insufficient information provided in the referral to investigate however review of Webfleet did not reveal any evidence to substantiate the allegation. 10/0625 12.06.25 Roads and Neighbourhood Allegation of misuse of council vehicles. Closed – investigation did not reveal any evidence to substantiate allegation. 12/0625 25.06.25 Housing Misuse of council vehicle. Closed – investigation unable to progress as no tracking information available for vehicle. Vehicle returned to Transport Services to allow Webfleet to attend to check and repair tracking device. 13/0625 28.06.25 Chief Executive Complaint about Chief Officer Closed – insufficient information provided in the referral to investigate. 16/0725 24.07.25 Housing Allegation that employee is running own business during working hours. Ongoing – joint investigation being progressed between Audit & Fraud and HR. 18/0825 06.08.25 Housing Complaint about employee behaviour. Closed – referred to Service to investigate as a complaint. Page 43
Page 44
Ref/ Date Service Area Detail Status 21/0825 26.08.25 Housing Allegation that employee is stealing council materials and dropping off at home address to undertake homers. Ongoing – joint investigation being progressed between Audit & Fraud and HR. 25/0825 27.08.25 Regulatory and Regeneration Allegation of potential breach of annual leave process. Closed - Referred to service as operational matter. 31/1025 26.10.25 Housing Allegation of misuse of council facilities. Closed – investigated by Service and misuse identified and relevant management action taken. 4.6 Activity relating to other investigation referrals for recent reporting periods is as follows: Period No. of Cases 1st January 2019 to 30th June 2019 14 1st July 2019 to 30th June 2020 8 1st July 2020 to 31st December 2020 2 1st January 2021 to 18th August 2021 1 19th August 2021 to 31st January 2022 2 1st February 2022 to 15th July 2022 2 16th July 2022 to 18th January 2023 5 19th January to 18th July 2023 0 19th July 2023 to 24th January 2024 10 27th January to 31st October 2024 11 1st November 2024 to 31st March 2025 9 1st April to 31st October 2025 12 4.7 A follow up process is in place to ensure recommendations made have been implemented. Outcomes are used to inform internal audit planning for future years. 5. People Implications 5.1 There are no personnel implications with this report. 6. Financial and Procurement Implications 6.1 There are neither financial nor procurement implications with this report. Page 44
Page 45
7. Risk Analysis 7.1 There are risks to the Council in financial, legal, operational and reputational terms of not providing a service to enable a disclosure in the public interest and to ensure that all public interest disclosure and other concerns raised with Internal Audit are properly investigated. 8. Equalities Impact Assessment (EIA) 8.1 There is no requirement to undertake an equality impact screening. 9. Consultation 9.1 This report has been subject to consultation with appropriate Chief Officers. 10. Strategic Assessment 10.1 The Public Interest Disclosure Policy and Business Irregularity Procedures contribute to the Council's strategic priorities by ensuring that early warnings of malpractice may mitigate the extent of financial losses to the Council, contribute to better asset management by utilising employees to manage risks to the organisation's reputation and support fit for purpose services through the continuation and promotion of robust employment practice. .................................... Laurence Slavin Chief Officer - Resources Date: 6 November 2025 Person to Contact: Andi Priestman, Shared Service Manager – Audit & Fraud Email: andi.priestman@west-dunbarton.gov.uk Appendix: None Background Papers: Public Interest Disclosure Policy; Business Irregularity Procedures Wards Affected: All Page 45
Page 46
Page 46
Page 47
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - Citizen, Culture & Facilities Audit Committee - 10 December 2025 ___________________________________________________________________ Subject: Scottish Public Services Ombudsman Complaints Report 2024-25 1. Purpose 1.1 The purpose of this report is to present the Scottish Public Services Ombudsman (SPSO) report on complaints handling by West Dunbartonshire Council for the year 1 April 2024 – 31 March 2025. 2. Recommendations 2.1 It is recommended that Committee: • Notes the contents of the report and the ongoing commitment at a service and strategic level to monitor complaints and ensure compliance with Scottish Public Services Ombudsman (SPSO) timelines. 3. Background 3.1 West Dunbartonshire Council administer the SPSO complaint handling model operating in line with all other Local Authorities. Complaints continue to be managed centrally by the Customer Relations team for all Council services. Complaints regarding West Dunbartonshire Health and Social Care Partnership (HSCP) are managed independently by the partnership. 3.2 Statutory appeals and reviews, such as planning decision appeals, continue to be directed to the relevant decision-making body, and are not processed through the SPSO office. 3.3 Centralised complaints handling ensures an open and transparent process. Complaints are valued because they provide an insight into services, and how the Council is performing. The feedback offers valuable information helping to inform service planning, improve how services are delivered and ensure customer’s voices are heard and views considered. Customers who remain dissatisfied with the final outcome of their complaint are openly directed to the SPSO to have their case considered for review. 3.4 West Dunbartonshire Council acts as factor for the buildings where we retain an interest with tenanted properties. Anyone who remains dissatisfied with the outcome of their complaint may also be signposted to the First-tier Tribunal for Scotland (Housing and Property Chamber). The Tribunal is an independent and impartial judicial body whose function is to review complaints from homeowners who consider their property factor has failed to perform its Item 9 Page 47
Page 48
factoring duties or failed to comply with the Property Factors’ Code of Conduct. 3.5 As a member of the Local Authority Complaints Handlers Network, the Council continues to fully engage in sharing of good practice and developing consistent approaches to complaints handling and reporting. Network meetings are held regularly, with SPSO in attendance at each meeting. 4. Main Issues 4.1 The SPSO delivers an annual report to each Local Authority detailing the number of complaints reported to its office. Appendix 1 provides a breakdown of enquiries handled by SPSO relating to West Dunbartonshire Council for 2024-25 together with comparison data for 2023-24. Appendix 2 is a summary breakdown of complaints received by the Council in 2024-25. Appendix 3 shows Social Work complaints handled by the HSCP for the same period. 4.2 In the year 2024-25, SPSO received 35 complaints regarding the Council, an increase of six from 2023-24. The highest proportion of complaints made by West Dunbartonshire citizens related to housing matters. 4.3 Of the 35 complaints to SPSO, 16 were handled at the Advice and Guidance stage. This is the initial receipt stage at SPSO where all enquiries are assessed. At this stage, four were deemed mature meaning they had completed the Council’s complaints process. In these cases advice was offered by SPSO and the complaint was not considered further. A further five were deemed as premature, which is terminology used by the SPSO when the complainant has not exhausted the Council’s complaints process. Another seven were handled as enquiries where SPSO would have offered information and support and can refer people to other organisations that may be better placed to help such as the Financial Services Ombudsman. 4.4 The SPSO’s Early Resolution stage is where SPSO start to gather information they need to decide if full investigation is required. Of complaints considered by SPSO at this stage, two were closed by SPSO as unable to proceed where they determined they could not take the complaint forward. 4.5 A further 17 complaints were handled by the SPSO at the Early Resolution Stage. At this stage the SPSO applied discretion in three cases where it deemed insufficient benefit would be achieved by investigation. One was closed as an alternative course of action was proposed. A further one was resolved where both SPSO and the complainant were satisfied with proposed outcome. There were a further 12 complaints closed by SPSO under good complaints handling meaning SPSO were satisfied complaints had been fully and appropriately investigated and responded to by the Council and SPSO could not achieve a better outcome. Page 48
Page 49
4.6 There were no complaints fully investigated by the SPSO during the year 2024-25. 4.7 The low number of complaints considered by SPSO is positive and reflects on the high level of effective complaints handling within West Dunbartonshire Council. 4.8 As outlined in Appendix 2, the Council handled 1633 complaints internally in 2024-25. Of these, 1486 were closed within 2024-25. The difference in complaints handled and closed is due to complaints being received during the reporting period but still being worked on. The remaining 147 were closed in 2025-26 and will be included in appropriate reporting periods. When registering a complaint, residents preferred method is the online complaints form which accounted for 71% of all complaints received. The telephone is the next preferred method accounting for 16%. 4.9 As noted above, the number of complaints received in 2024-25 was 1633. This represents an increase of 160% when compared to complaints received in 2023-25 (628). The significant increase in complaints was due to multiple factors including the introduction of the garden waste permit and the change to bin collections over the festive period. It is important to continue to encourage capturing expressions of dissatisfaction. Complaints data provides services with valuable information to inform service improvement and understand the expectations of customers. 4.10 Of the 1146 complaints closed, 93% were resolved within SPSO timescales, including with extension where applicable, representing an increase of 10% from 2024-25 (83%). Customer Relations maintain a focus on right first time and is committed to ensuring the quality of responses remains high whilst seeking to improve response times again in 2025-26. 4.11 In line with this, the service continues to work to encourage a culture of welcoming complaints and ensuring services across the Council use the data provided to identify and progress complaints improvement activity. 5. People Implications 5.1 There are no people implications arising from this report. 6. Financial and Procurement Implications 6.1 There are no financial implications arising from this report. 7/ Page 49
Page 50
7. Risk Analysis 7.1 There is a reputational risk in not responding to complaints in defined time periods within the two stage process. Complaints data is closely monitored, including response times and quality of response from services. Customer Relations continue to work to support services to improve response timescales and maintain quality of complaints management. 7.2 There is a risk that services do not learn from the complaints received and do not adapt processes or policies to stop it happening again. To reduce this risk complaints data is reported quarterly to Performance & Monitoring Review Group. Complaints data is also shared with Chief Officers and included within service Delivery Plans to ensure visibility and to assist in informing service improvements. 8. Equalities Impact Assessment (EIA) 8.1 The two stage process has been equality impact assessed at a National level. Locally, all aspects have been considered and assistance to navigate the complaints process is available for all customers. 9. Consultation 9.1 Not applicable to this report. 10. Strategic Assessment 10.1 Effective complaints handling contributes to all four Council strategic priorities. Amanda Graham Chief Officer - Citizen, Culture and Facilities Date: 6 November 2025 ___________________________________________________________________ Person to Contact: Stephen Daly Citizen & Library Manager Citizen, Culture and Facilities Council Offices, 16 Church Street, Dumbarton 01389 737263 Appendices: Appendix 1 – SPSO Complaints Data Page 50
Page 51
Appendix 2 - Summary of Council Complaints 2024-25 Appendix 3 - Summary of HSCP Complaints 2024-25 Background Papers: None Wards Affected: All Wards Page 51
Page 52
Page 52
Page 53
West Dunbartonshire Council complaints closed 2024-25 Stage Outcome Group West Dunbartonshire Council Advice A&G - Complaint submissions - mature 4 A&G - Complaint submissions - premature 5 A&G - Enquiries 7 Unable to proceed 0 Total 16 Early Resolution Cause and impact test not met (s 5 (3)) 0 Discretion – Alternative action proposed 1 Discretion – Alternative route used or available 0 Discretion – Good complaint handling 12 Discretion – Insufficient benefit would be achieved by investigation 3 Discretion – Referred back 0 Discretion – Resolved - both parties satisfied with proposed outcome 1 Member of the public test not met (s 5 (6)) 0 Premature 0 Right of appeal to court/tribunal/Scottish ministers (s 7 (8)) 0 Subject matter not in jurisdiction 0 Time limit (s 10) 0 Unable to proceed 2 Total 19 Investigation Fully upheld 0 Not duly made or withdrawn 0 Not upheld 0 Some upheld 0 Total 0 Total 35 Item 9 Appendix 1 Page 53
Page 54
West Dunbartonshire Council complaints closed 2023-24 Stage Outcome Group Total Advice A&G - Complaint submissions - mature 0 A&G - Complaint submissions - premature 10 A&G - Enquiries 6 Organisation not in jurisdiction 0 Total 16 Early Resolution Cause and impact test not met (s 5 (3)) 0 Discretion – Insufficient benefit would be achieved by investigation 2 Discretion – Alternative action proposed 0 Discretion – Alternative route used or available 0 Discretion – Good complaint handling 4 Discretion – Referred back 1 Discretion – Resolved - both parties satisfied with proposed outcome 0 Member of the public test not met (s 5 (6)) 1 No response to contact 0 Organisation not in jurisdiction 0 Premature 0 Right of appeal to court/tribunal/Scottish ministers (s 7 (8)) 0 Subject matter not in jurisdiction 1 Time limit (s 10) 1 Unable to proceed 0 Total 10 Investigation Fully upheld 1 Not duly made or withdrawn 0 Not upheld 1 Resolved 1 Some upheld 0 Total 3 Total 29 Page 54
Page 55
Year 2024-25 Performance & Monitoring 2024/25 Total Complaints Received Complaints Received Stage 1 Complaint s Received Stage 2 Total complaints closed Closed at Stage 1 Closed within 5 Working Days Citizen, Culture & Facilities 25 24 1 25 24 20 Education, Learning & Attainment 52 44 8 41 29 22 Housing & Employability 490 447 43 456 426 226 People & Technology 0 0 0 0 0 0 Regulatory & Regeneration 14 13 1 13 13 7 Resources 54 48 6 43 36 18 Roads & Neighbourhood 998 972 26 908 888 853 Totals 1633 1548 85 1486 1416 1146 0 1259 209 0 0 18 0 66 42 4 0 35 1633 Complaints Received Complaints Closed Complaint Category Upheld per category Stage 1 Upheld per category Stage 2 Below declared service standard 0 0 Citizen expectation not met - quality of service 1002 12 Citizen expectation not met – timescales 66 5 Council policy – does not meet criteria 0 0 Council policy – charges 0 0 Delay in service delivery 0 0 Error in Service Delivery 21 0 Council policy – level of service provision 0 0 Employee behaviour 43 0 Failure to deliver service 0 4 Service standards not declared 0 0 Total 1144 22 Contractor 12 1 Item 9 Appendix 2 Page 55
Page 56
Extension Stage 1 Exceeded S1 deadline after extension ie +10days Total working days to close Stage 1 complaints Average working days to close S1 Closed at Stage 2 Closed within 20 working days Extension Stage 2 Exceeded S2 deadline after extention ie +25 Total working days to close Stage 2 complaints 3 1 83 3 1 0 0 1 43 5 2 145 5 7 4 3 0 111 138 62 2765 6 30 11 13 6 730 0 0 0 0 0 0 0 0 0 3 3 89 7 0 0 0 0 0 12 6 252 7 2 2 0 0 16 18 17 4557 5 11 4 3 4 335 179 91 7891 6 51 21 19 11 1235 Channel Received 188 1165 13 1 265 1 Social Media 0 1633 Complaints Closed Performance % of complaints closed within SPSO timescales average working days to close Stage 1 complaints average working days to close Stage 2 complaints % of Stage 1 complaints upheld % of Stage 2 complaints upheld Equalities E-mail Equality concern raised Internal Complaints form Online Complaints form In Writing By telephone TOTAL Face to Face Page 56
Page 57
Outcome Average working days to close S2 Escalated from Stage 1 to 2 Upheld Stage 1 Not Upheld Stage 1 Upheld Stage 2 Not upheld Stage 2 Resolved 43 0 21 3 0 1 0 16 0 16 13 5 2 5 24 0 239 187 12 18 0 0 0 0 0 0 0 0 0 0 5 8 0 0 0 8 0 17 19 0 2 5 30 0 846 42 5 6 9 24 0 1144 272 22 29 19 93% 6 24 81% 43% 0 Complaints Closed Equalities Page 57
Page 58
Page 58
Page 59
WDHSCP COMPLAINTS 2024/25 Social Work Services Total Children’s Health, Care & Criminal Justice 8 Community Health and Care Services 27 Mental Health, Learning Disability & Addictions 9 Total 44 Themes Communication 8 Policy 9 Failure to provide service 17 Failure to Achieve Standards/Quality of Service 7 Conduct 3 Request for 3rd Party Information/Data Breach 2 Response Acknowledged within 3 days 37 Response within 28 days 22 Outcomes Upheld 6 Partially Upheld 14 Not Upheld 22 Withdrawn 2 * Please note a complaint may cover multiple themes. 233 Frontline complaints Item 9 Appendix 3 Page 59
Page 60
Page 60
Page 61
West Dunbartonshire Council Report by the Chief Officer - Resources Audit Committee - 10 December 2025 Subject: Treasury Management Mid-Year Report 2025/2026 1. Purpose 1.1 The purpose of this report is to provide Members with an update on treasury management to 30 September 2025. 2. Recommendations 2.1 Members are requested to: (a) note the treasury management stewardship information within the appended report (b) approve the 2025/26 revised estimates of treasury and prudential indicators as advised within the appended report (Tables A, B, C, D, E, F, H, L and N) (c) remit the 2025/26 Treasury Management Mid-Year Report to full Council for approval. 3. Background 3.1 In accordance with the Treasury Policy governing the Council’s treasury management activities the Chief Officer - Resources is required to provide a mid-year report to Members regarding the Treasury function. 3.2 The mid year report covers the period 1 April 2025 to 30 September 2025, details the current position (where appropriate) and revises the 2025/26 estimates where required. 3.3 One of the key clauses of the Treasury Policy is that a responsible body is required to ensure effective scrutiny of the treasury management strategy and polices. Within West Dunbartonshire Council the body identified to fulfil this role is the Audit Committee. 4. Main Issues Treasury Management Stewardship Report 4.1 A copy of the report is attached as Appendix 1. Item 10 Page 61
Page 62
4.2 The report provides details of key changes to the Council’s capital activity (the prudential indicators), the economic outlook, the actual and proposed treasury management activity (borrowing and investment) and the risk approach to treasury management (the treasury management indicators). 4.3 The external debt figures included within Table C of the report includes short term and long-term debt. 5. Option Appraisal 5.1 No option appraisal was required for this report. 6. People Implications 6.1 There are no people implications arising from this report. 7. Financial and Procurement Implications 7.1 There are no direct financial or procurement implications arising from this report. 8. Risk Analysis 8.1 There are three main risks associated with the formulation of prudential indicators and the treasury management strategy as detailed in Appendix 1. These risks are noted below; however the Council has robust monitoring processes and provides regular reports to Council with further scrutiny by the Audit Committee: (a) Capital receipts which affect the capital financing and borrowing requirement may not materialise, if this occurs additional borrowing will be required in order to fund the financing requirement. (b) The risk of counterparties default (i.e. loss of principal sum invested) however the Council has robust controls included within its treasury management and investment strategies that help minimise this risk. (c) Capital inflation may increase capital expenditure level which will affect the capital financing and borrowing requirement leading to an increase in borrowing, assuming no additional capital receipts are available. 9. Equalities Impact Assessment 9.1 No equalities impact assessment was required in relation to this report. 10. Environmental Sustainability Page 62
Page 63
10.1 No assessment of environmental sustainability was required in relation to this report. 11. Consultation 11.1 The views of Legal Services have been requested on this report who advised there are no issues or concerns. 12. Strategic Assessment 12.1 Proper budgetary control and sound financial practice are cornerstones of good governance and support Council and officers to pursue the five strategic priorities of the Council’s Strategic Plan. 12.2 Treasury management contributes to the Financial Strategy via the interdependency that exists between pro-active treasury management and the formulation of long-term financial plans. _______________________ Laurence Slavin Chief Officer – Resources Date: 5 November 2025 Person to Contact: Lynsey Dickson, Business Partner, Resources Council Offices, Church Street, Dumbarton Email: Lynsey.Dickson@west-dunbarton.gov.uk Appendix: Appendix 1: Treasury Management Stewardship Mid- Year Monitoring Report 2025/26 Treasury Management and Prudential Indicators 1 April 2025 to 30 September 2025 Background Papers: 1. Loans register and portfolio 2. Debt rescheduling schedules 3. Prudential Indicators 2024/25 to 2033/34 and Treasury Management Strategy 2024/25 to 2033/34 (Council 26 March 2025) Wards Affected: No wards directly affected. Page 63
Page 64
Page 64
Page 65
Mid-Year Monitoring Report 2025/26 Treasury Management and Prudential Indicators: 1 April 2025 to 30 September 2025 1. Introduction 1.1 The Council’s treasury management activities are regulated by a variety of professional codes, statutes and guidance: The Local Government in Scotland Act 2003 (the Act) provides the powers to borrow and invest and provides controls and limits on this activity. The Act permits Scottish Ministers to set limits either on the Council or nationally on all councils restricting the amount of borrowing which may be undertaken (no restrictions have been made as yet during 2025/26). Statutory Instrument 29 2004, requires the Council to undertake borrowing activity with regard to the CIPFA Prudential Code for Capital Finance in Local Authorities, and therefore to operate the overall treasury function with regard to the CIPFA Code of Practice for Treasury Management in the Public Services; and the treasury activity with regard to the CIPFA Code of Practice for Treasury Management in Local Authorities. Statutory Instrument 123 2016, sets out statutory arrangements for local authority borrowing and lending and the requirement to maintain a loans fund and replaces the statutory arrangements set out in Schedule 3 of the Local Government (Scotland) Act 1975. 1.2 The regulatory framework of treasury management requires the Council to receive a mid-year treasury review, in addition to the forward looking annual treasury strategy and backward looking annual treasury report. This report meets that requirement and also incorporates the needs of the Prudential Code to ensure adequate monitoring of the capital expenditure plans and the Council’s prudential indicators. The Treasury Strategy and Prudential Indicators were previously reported to Council on 26 March 2025. The current position is shown (where appropriate) and revisions to the 2025/26 estimate are provided where required. 1.3 In December 2021, the Chartered Institute of Public Finance and Accountancy, (CIPFA), issued revised Prudential and Treasury Management Codes. These require all local authorities to prepare a Capital Strategy which provides the following: a high-level overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of services an overview of how the associated risk is managed the implications for future financial sustainability The Council’s Capital Strategy was agreed by Council on 5 March 2025. 1.4 This report sets out: key changes to the Council’s capital activity (prudential indicators) Item 10 Appendix 1 Page 65
Page 66
Appendix 1 an economic update for the first part of 2025/26 the actual and proposed treasury management activity (borrowing and investment) the risk approach to treasury management (treasury management indicators). 2. Key Prudential Indicators 2.1 This part of the report updates: the Council’s capital expenditure plans and how these plans are being financed the impact of the changes in the capital expenditure plans on the prudential indicators and the underlying need to borrow compliance with the limits in place for borrowing activity the policy on the statutory repayment of loans fund advances. 2.2 Capital Expenditure – Table A illustrates the current position and revised estimates for capital expenditure for 2025/26. Table A 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Projected Outturn* (£,000) General Services 73,780 14,975 70,325 HRA 70,338 16,959 49,843 Capital Expenditure 144,118 31,934 120,168 Financed by: Capital Grants 55,745 13,937 60,294 Revenue / Other 2,957 0 396 Net Financing Need 85,416 17,997 59,478 2.2.1 The movement in the level of anticipated capital expenditure is mainly due to reprofiling carried out in 2025/26 over the life of the projects. The anticipated spend and resources are reported to Members through budgetary control reports. 2.3 Impact of changes in Capital Expenditure Plans – Table B shows the Capital Financing Requirement (CFR), which is the underlying external need to borrow for a capital purpose while Table C shows the expected debt position over the period. Table B 2025/26 Original Estimate (£,000) 2025/26 Projected Outturn (£,000) Opening CFR (1 April 2025) 947,408 881,494 New Borrowing 73,525 42,342 Long term liabilities repayment in year 0 (1,636) Page 66
Page 67
Appendix 1 Closing CFR (31 March 2026) 1,020,933 922,200 Movement in CFR 73,525 40,706 Net financing need for the year (Table A) 85,416 59,478 Loan repayments in year - excluding long term liabilities (PPP) (11,891) (17,136) New Borrowing - Movement in CFR (from previous year) 73,525 42,342 Table C 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Projected Outturn (£,000) External Debt Estimated/Actual Debt at 1 April 2025 635,303 771,372 790,778 Maturing Debt (322,687) (120,000) (314,677) Movement in Borrowing New Borrowing - Maturing Debt 322,687 120,000 314,677 New Borrowing – CFR (Table B) 73,525 0 42,342 Debt at 31 March (1) 708,828 771,372 833,120 Long Term Liabilities at 1 April 84,041 82,853 82,853 Long Term Liabilities repayment in year (Table B) 0 (682) (1,636) Long Term Liabilities at 31 March (2) 84,041 82,171 81,217 Actual Debt at 31 March (1) + (2) 792,869 853,543 914,337 CFR from Table B 1,020,933 n/a 922,200 Under/(Over) Borrowing 228,064 n/a 7,863 2.3.1 The external debt figures included within Table C includes both short term and long-term debt. This is due to the current strategy of using short-term borrowing to fund long term capital investment enabling the Council to take advantage of lower interest rates. The reduction in the estimated external debt for 2025/26 is due to a reduction in the net capital financing need for the year. 2.3.2 The capital financing requirement is calculated on a year-end position based on the Council’s balance sheet. The capital financing requirement has reduced from the original estimate due to the forecast level of capital expenditure in 2025/26 being less than budgeted. The Chief Officer - Resources can report that the Council is currently on target to meet the 2025/26 revised estimates for both indicators. 2.3.3 Table C highlights that the borrowing of the Council is forecasting a borrowed position less than the capital financing requirement at 31 March 2026. 2.4 Compliance with the limits in place for borrowing activity – A key control over the treasury activity is a prudential indicator to ensure that, over the medium term, gross borrowing will only be for capital purposes. Page 67
Page 68
Appendix 1 Gross external borrowing should not, except in the short term, exceed the total of capital financing requirement in the preceding year plus the estimates of any additional capital financing requirement for 2025/26 and next two financial years. This allows some flexibility for limited early borrowing for future years. The Council has approved a policy for borrowing in advance of need which will be adhered to if this proves prudent. The revised indicator is detailed in Table D and is illustrated by comparing the estimated gross debt as at 31 March 2025 with the capital financing requirement as at 31 March 2026. The Chief Officer - Resources reports that no difficulties are envisaged for the current year in complying with this prudential indicator. Table D 2025/26 Original Estimate (£,000) 2025/26 Projected Outturn (£,000) CFR at 31 March 2025 Estimate/Actual (Table B ) 947,408 881,494 Estimated movement in CFR 2025/26 (Table B) 73,525 40,706 2026/27 76,158 64,042 2027/28 48,094 48,094 Anticipated CFR at 31 March 2025 1,145,185 1,034,336 Gross Debt at 31 March 2023 (Table C) 792,869 853,543 2.4.1 The Operational Boundary is detailed in Table E below and is the limit beyond which external debt is not normally expected to exceed. In most cases, this would be a similar figure to the capital financing requirement, but may be lower or higher depending on the levels of actual debt. Table E 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Projected Outturn (£,000) External Debt 793,106 853,543 938,898 2.4.2 The Authorised Limit (detailed in Table F) is a prudential indicator which sets the limit beyond which borrowing is prohibited, and needs to be set and revised by Members. It reflects the level of borrowing which, while not desired, could be afforded in the short term, but is not sustainable in the longer term. It is the expected maximum borrowing need with some headroom for unexpected movements. This is the statutory limit determined under section 3 (1) of the Local Government Act 2003. Table F Page 68
Page 69
Appendix 1 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Projected Outturn (£,000) External Debt 865,206 853,543 1,024,252 3. Economic Outlook from MUFG Treasury Advisors 3.1 UK With the August rate cut now done, we are comfortable revising our previous forecast for a November rate cut, instead pushing that back to February 2026, on the basis that CPI inflation should have peaked by then and will be on a slow downwards trajectory back to 2% by 2027. Further gradual reductions in Bank Rate to 3.25% are then anticipated but, and it is a big but, only if inflation and employment data are supportive of such cuts. For threats to that central scenario abound. What if wage increases remain stubbornly high and in the region of 5% even as the economy stutters towards a position of flatlining or tepid growth? There are several sectors of the domestic economy, including social care provision, where staff shortages remain - even as unemployment ticks higher (currently 4.7%). And what about the hikes in general taxation likely to arise from the 26th November Budget. There is an estimated £15bn - £25bn second “black hole” to fill, so will there be further borrowing announced by the Chancellor to add to taxation funding? If so, how will gilt markets react to these variables…and will there be additional geo-political factors to also bake in, particularly the Fed’s monetary policy decision in September (currently 85% prospect of a rate cut) and the ongoing tariff policies emanating from the White House. And, of course, how will the ongoing conflicts in the Middle East and between Russia and Ukraine influence matters? Moreover, it looks likely that the Bank of England will reduce the pace of its Quantitative Tightening from an annual £100bn (October 2024 to September 2025) to a range between £60bn and £75bn from October 2025 (Market Participants Survey, August 2025). If that policy move also sees a shift in the gilts being sold to having shorter durations, this should prove supportive of the gilt market generally. Accordingly, our updated central forecast is made with several hefty caveats. We are confident, as we have been for some time, that our forecast for Bank Rate and the 5-year PWLB Certainty Rate is robust. But for the 10-, 25- and 50-years part of the curve, the aforementioned factors may all have a role to play in whether we end up above, close to or below our new forecasts. As it is, we have lifted our starting points and finishing points within the medium to longer dated forecasts. Clients will be aware from presentations at our Strategic Issues webinars that net annual gilt issuance of c£180bn is around a four-fold increase compared to recent annual issuance, and with pension fund and insurance company investment favouring shorter durations, it has been left to transient foreign investors and hedge funds to fill the investor vacuum. Whilst this backdrop prevails, we see no obvious reason why medium to longer gilt yields will not remain at elevated levels, even allowing for a gradual Page 69
Page 70
Appendix 1 reduction in inflation over the course of the forecast. Consequently, our forecasts at Q3 2028 are 20 basis points higher than previously projected for the 10 years and 50 basis points higher for 25 to 50 years. Our revised PWLB rate forecasts below are based on the Certainty Rate (the standard rate minus 20 bps) which has been accessible to most authorities since 1 November 2012. Please note, the lower Housing Revenue Account (HRA) PWLB rate started on 15 June 2023 for those authorities with an HRA (standard rate minus 60 bps) and is set to prevail until at least the end of March 2026. Hopefully, there will be a further extension to this discounted rate announced in the Budget. 3.2 Scotland Total funding in 2025-26 is just over £60 billion. This is £485 million higher than presented in our May 2025 report. Most of this increase comes from additional funding being carried into 2025-26 from the previous year. There is also additional social security Block Grant Adjustment funding as a result of UK Government changes to Winter Fuel Payment in England and Wales and lower borrowing costs than previously planned. In 2026-27, although the total available funding is similar to our May 2025 report, the split between resource and capital has changed, with resource lower and capital higher. By 2030-31 total funding is projected to be £994 million lower than in our May report with resource funding down £700 million and capital funding down £293 million. This follows the UK Government Spending Review on 11 June 2025, which set Scotland’s block grant resource funding through to 2028-29 and capital funding through to 2029-30. In May 2025, ahead of the UK Government’s Spending Review, we assumed the resource and capital Block Grant would change broadly in line with the Office for Budget Responsibility’s (OBR) March 2025 forecast of growth in overall UK department spending. Making this assumption allowed us to present an overview of the Scottish Government’s funding position. Now that we have the details of the UK Government’s Spending Review, we have updated that position. Over the period from 2024-25 to 2030-31, resource funding is expected to grow by 24 per cent in nominal terms. After adjusting for inflation, the growth is 10 per cent. Devolved social security spending is taking up an increasing share of the resource budget. This reduces funding growth available for all other areas of spending to 6 per cent in real terms over the next five years. In the current year (2025-26), spending on social security is 13.2 per cent of resource funding, and is expected to increase to 15.6 per cent by the end of the forecast period in 2030-31. One of the immediate pressures we discussed in our May 2025 report was public sector pay. The MTFS provides some additional information on public Page 70
Page 71
Appendix 1 sector pay, noting that it accounts for 55.0 per cent of the entire Scottish resource budget in 2025-26. As we noted in our May 2025 report, pay deals agreed so far in 2025-26 have been above the Scottish Government’s Public Sector Pay Policy of 3 per cent in 2025-26. For example, NHS workers in Scotland on Agenda for Change terms have agreed a pay rise of 4.25 per cent in 2025-26 and 3.75 per cent in 2026-27. We have commented before on the cumulative future impact of current pay awards. A higher current award not only increases the paybill in the current year, but also the cost of every future award because it increases the base to which those future awards are applied. The remaining pay negotiations this year will now be conducted against the background of the Scottish Government’s newly announced workforce reduction policy. Although the Government has retained its policy of no compulsory redundancies, the impact of this change may influence negotiations. 3.3 International update Since March, the US Government has announced a series of tariff policy changes for various countries and products. The baseline projections in this Report are conditioned on the tariff rates implemented as of 29 July, which for the US means an estimated effective tariff rate of around 14%. This is down from the 23% estimate based on trade policies that had been implemented at the time of the May Report, but up from the 2% estimate prior to the policy changes. Tariff rates fell after the May Report as there was a de-escalation of tensions between some countries, particularly the US and China, and trade agreements between others, initially the US and the UK. After that agreement, the estimated effective US tariff rate on the UK fell from 11% estimated at the time of the May Report to 8%–9% now. Military action between Iran and Israel (later joined by the US) in June, led to a rise in spot oil prices, peaking at a little under $80 a barrel, up from a little over $60 at the time of the May Report. Since then, tensions have eased, and spot oil prices have fallen back and averaged a little under $70 a barrel over the 15 working days to 29 July. Oil prices are currently below levels seen at the start of the year reflecting a combination of increased supply from OPEC countries and the expectation of weaker global demand. Liquified natural gas prices similarly increased in June but subsequently fell back. Oil and gas prices have ended the period since May slightly higher than their levels at the time of the previous Report. * Link Group Interest Rate Forecast 11TH August 2025 ** Scottish Fiscal Commission Report 29th May 2025 & revised version June 2025 *** Bank of England Monetary Policy Report – August 2025 Page 71
Page 72
Appendix 1 3.4 Based upon the above information, the Council’s treasury advisor, MUFG, has provided the following interest rate forecast as at August 2025. With no changes made after this date, they have revised the forecast pushing back a rate cut until February 2026. It sets out a view that short, medium and long-dated interest rates will fall back over the next year or two, on the basis that CPI inflation should have peaked by then and will be on a slow downwards trajectory back to 2% by 2027. Further gradual reductions in Bank Rate to 3.25% are then anticipated, but, only if inflation and employment data are supportive of such cuts. Table G: - Source: MUFG Corporate Markets 3.5 Downside risks to current forecasts for UK gilt yields and PWLB rates currently include: Labour and supply shortages prove more enduring and disruptive and will depress economic activity (accepting that in the near-term this is also an upside risk to inflation and, thus, rising gilt yields). The Bank of England acts too quickly, or too far, over the next two years to raise Bank Rate and causes UK economic growth, and increases in inflation, to be weaker than we currently anticipate. UK / EU trade arrangements – if there was a major impact on trade flows and financial services due to complications or lack of co-operation in sorting out significant remaining issues. Geopolitical risks, for example in Ukraine/Russia, China/Taiwan/US, Iran, North Korea and Middle Eastern countries, which could lead to increasing safe-haven flows. 3.6 Upside risks to current forecasts for UK gilt yields and PWLB rates are as The Bank of England is too slow in its pace and strength of increases in Bank Rate and, therefore, allows inflationary pressures to build up too strongly and for a longer period within the UK economy, which then necessitates an even more rapid series of increases in Bank Rate faster than we currently expect. The Government acts too quickly to cut taxes and/or increases expenditure in the light of the cost-of-living squeeze. The pound weakens because of the UK’s growing borrowing requirement resulting in investors pricing in a risk premium for holding UK sovereign debt. Page 72
Page 73
Appendix 1 Longer term US treasury yields continue to rise strongly and pull gilt yields up even higher than currently forecast. 4. Treasury Management Activity 4.1 This part of the report updates: the Council’s expected borrowing need and details of under/(over) borrowing debt rescheduling and new borrowing debt charges investments 4.2 The Expected Borrowing Need – This was set out in Table C and demonstrates that at 31 August 2025 the Council is projecting an under- borrowed position. It should be noted that due to current economic climate the borrowing rates are significantly different than this time last year, with long term borrowing rates for periods greater than 25 years currently between 6.31% and 6.58%, depending on length of term for borrowing (as at 2 September 2025). This introduces an element of interest rate risk, as longer term borrowing rates may rise further; however, this position is being carefully monitored. 4.3 Debt rescheduling and new borrowing – The Council has undertaken debt rescheduling during 2025/26 of £33.100m (to 30 September 2025). In the year to date naturally maturing debt of £135.000m has been repaid which has been mainly funded by loans from other local authorities. 4.4 Debt Charges – The revised estimate for debt charges for both the General Fund and the HRA is shown in Table H. Table H 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Revised Estimate (£,000) Borrowing 51,893 24,647 49,294 Other Long-Term Liabilities 9,061 4,531 9,061 Total 60,954 29,178 58,355 4.5 Investments – The objectives of the Council’s investment strategy are to ensure the re-payment of the principal and interest of its investments on time with the level of investment return being a secondary objective. Following on from the economic background above, the current investment climate has one over-riding risk which is the risk of default. 4.5.1 The Council held £29.1m of cash investments at 30 September 2025, and the constituent parts of the investment position are detailed in Table I: Page 73
Page 74
Appendix 1 Table I £000 Country < 1 Year 1–2 Years 2–3 Years Banks UK 4,129 Nil Nil Money Market Fund UK 20,000 Nil Nil Local Authorities UK 5,000 Nil Nil Total UK 29,129 Nil Nil 4.5.2 Table J details the revised budget position for investment income. The original estimate has increased by £0.621m due to ongoing interest rate changes. Table J 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Revised Estimate (£,000) Investment Income 21 321 642 4.5.3 A regulatory development to address risk is the consideration and approval of benchmarks relating to investment security, liquidity and the level of return. Benchmarks are used to assess the level of return and investment performance, however the application of security and liquidity benchmarks are more subjective in nature. Security - The Council’s maximum security risk benchmark for the current portfolio in relation to investment periods of up to one year (when compared to historic default tables) was set at 0.00% and the Chief Officer - Resources can report that there have been no defaults of principal sums invested in the year to date. Creditworthiness - Significant levels of downgrades to Short- and Long- Term credit ratings have not materialised since the crisis in March 2020. Liquidity – The Chief Officer - Resources can report that liquidity arrangements were adequate during the year to date and that the liquidity facilities and benchmarks set by the Council as noted below were maintained: o Bank overdraft - £1.000m o Liquid short term deposits of at least £5.000m available on an overnight basis. Return on Investments – The Chief Officer - Resources can report that the investment return to date averages 4.31%. Table K illustrates how this average return compares with the local benchmarks. Table K Benchmark Benchmark Return Average Return Compound 12 month SONIA* 4.47% 4.31% Council’s Instant Access Account 4.18% 4.31% Page 74
Page 75
Appendix 1 * SONIA is Sterling Overnight Index Average and has replaced LIBOR & LIBID 5 Key Treasury Management Indicators 5.1 This part of the report updates: actual and estimates of the ratio of financing costs to net revenue stream upper limits on interest rate exposure maturity structure of borrowing total principal sums invested. 5.2 Actual and estimates of the ratio of financing costs to net revenue stream – This indicator (Table L) identifies the trend in the cost of capital against the net revenue stream. Table L 2025/26 Original Estimate 2025/26 Revised Estimate General Fund 10.36%* 9.43% HRA 53.00% 51.01% *The General Fund 2025/26 Estimate has been restated in line with the funding used in the Performance Indicator. 5.3 Upper Limits on Fixed and Variable Rate Exposure – These indicators identify a maximum limit for fixed and variable interest rates based upon the debt position. They were set at 100% and 50% respectively for 2025/26. The Chief Officer – Resources reports that the Council operates within these limits. 5.4 Maturity Structures Of Borrowing – These maximum limits are set to reduce the Council’s exposure to large fixed rate loans (those instruments which carry a fixed interest rate for the duration of the instrument) which are due to naturally mature in any given period as detailed in Table M and show that the Council operates within limits set. Table M Maturity Structure of Fixed Interest Rate Borrowing 2025/26 Original Limits Current Position Under 12 months 50% 35% 12 months to 2 years 50% 4% 2 years to 5 years 50% 29% 5 years to 10 years 50% 6% 10 years to 20 years 50% 2% 20 years to 30 years 50% 4% 30 years to 40 years 50% 3% 40 years to 50 years 100% 14% 50 years to 60 years 100% 3% Page 75
Page 76
Appendix 1 60 years to 70 years 100% 0% 5.5 Total Principal Funds Invested – These limits are set to reduce the need to temporarily borrow to cover any unexpected expenditure and show limits to be placed on investments with final maturities beyond each year-end. The Council currently invests sums for periods greater than 365 days in Clydebank Property Company and hub West Scotland as detailed in Table N. Table N 2025/26 Original Estimate (£,000) Current Position (£,000) 2025/26 Revised Estimate (£,000) Clydebank Property Company 273 273 273 Hub West Scotland 198 198 198 Total Principal sums invested > 365 days (maximum limit £5m) 471 471 471 Page 76
Page 77
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer - People & Technology Audit Committee - 10 December 2025 ___________________________________________________________________ Subject: Accounts Commission Report - Audit of Glasgow City Council senior officer exit packages 1. Purpose 1.1 The purpose of this report is to detail West Dunbartonshire Council’s (the Council) response to the recommendations arising from a recent Controller of Audit’s report to the Accounts Commission on governance and transparency of decision making of exit packages of senior officers in Glasgow City Council. 2. Recommendations 2.1 Note the Council’s responses to each recommendation in the Accounts Commission letter 2.2 Agree that the current approach to the governance of exit packages, in particular those involving senior officers, is sufficient. 2.3 Agree that the Council’s Scheme of Delegation should be subject to review. 2.4 Note the revisions to the Code of Conduct as set out in paragraph 4.7. 3. Background 3.1 The release of 5 senior officers at Glasgow City Council, including the Chief Executive, allowing access to unreduced pension benefits resulted in a report from the Controller of Audit in relation to the scrutiny, governance and transparency of decision making of exit packages of senior officers in Glasgow City Council. The Accounts Commission considered its options in respect of the powers available and consequently published findings. While the report related to specific issues at Glasgow City Council there is an expectation that all Councils consider the issues highlighted by the report and discuss these at their respective Audit Committee. There is a further expectation that steps will be taken to review the Scheme of Delegation and decision-making processes connected with the release of officers. 3.2 The Accounts Commission letter to all Councils is attached as Appendix 1, with the full report on the 2023/2024 audit of Glasgow City Council available as Appendix 2. 4. Main Issues Item 11 Page 77
Page 78
Learning from the audit 4.1 The report highlights many of the same areas arising from earlier reports produced by the Accounts Commission including the December 1997 report and subsequent follow-up review about the management of early retirement. These were: Bye now, pay later? The management of early retirement in local government and Bye now, pay later? A follow-up review of the management of early retirement, published in June 2003. 4.2 Officers have reviewed the key recommendations documented in the report and Appendix 1 and are comfortable the Council’s current approach satisfies the Accounts Commission’s expectations. The undernoted confirms the Council’s position in relation to each of the five recommendations. 4.2.1 Recommendation 1 - Frameworks for decision-making: policies in relation to the exit packages of senior officers should be approved by councillors and reviewed regularly. Response: the discretions available to employers under the Local Government Pension Scheme (Scotland) Regulations 2018, are reviewed regularly with approval secured via Corporate Services Committee. Following notification of changes from Strathclyde Pension Fund Office, a report has been submitted to the meeting of Corporate Services Committee on 12th November 2025, notifying the revised schedule of discretions as applied by the Council. 4.2.2 Recommendation 2 - Informing councillors: councillors should receive a report at least annually that details the number of early retirals, and redundancy decisions made in the year, along with the associated costs and savings attached to these decisions. Response: details of early retirements, costs and savings are submitted to Corporate Services Committee annually as part of the ‘Workforce Planning and Monitoring Report’. This was last presented to committee in May 2025. 4.2.3 Recommendation 3 - Decision-making: councils should rigorously appraise individual business cases to ensure the expected savings associated with a retiral or redundancy outweigh the costs, ensuring value for money. Response: the Council have a cost benefit analysis (CBA) process linked to the ‘switch policy’ and HR guidance on application. The CBA requires a robust business case with payback generally within 2 years (aligned to Scottish Government Public Sector Pay Policy although not directly applicable to local authorities) and demonstrating value for money. These must be approved by the service chief officer/HSCP head of service; Chief Officers People & Technology and Resources, before being finally considered by the Chief Executive. Approved CBAs are retained in personnel files and by finance to ensure robust cost and saving reconciliation. 4.2.4 Recommendation 4 - To improve accountability and assist in monitoring, the costs of early retirement should be charged to the appropriate service budget. Page 78
Page 79
Response: costs and savings are held against the relevant council/HSCP central cost centre enabling the robust holistic reconciliation referred to in paragraph 4.2.3. 4.2.5 Recommendation 5 - Elected members should be involved in approving early retirement and redundancy decisions for senior staff, providing the independent scrutiny that is essential to issues and decisions where there are potential conflicts of interest. Response: senior level restructures, including any early retirements/voluntary severance are reported to the Council’s Recruitment and Individual Performance Committee for confirmation of proposals. Several senior officer posts have been deleted since 2016 as a result of restructuring which requires the deletion of the posts and work merged with another role and delivered in a different way. We do not routinely use fixed term contracts at this level (in recognition of recommendations from the earlier audit reports). Scheme of Delegation 4.3 The Council’s scheme of delegation was last reviewed in 2021 following a previous senior restructure. Based upon the expectations of the Audit Commission and the changes made to the Council’s senior team following the 2024 restructure it is recognised that the scheme of delegation requires to be reviewed. The information for the review has been gathered and the revised Scheme will be shared with Chief Officers to ensure it picks up any changes since the information gathering stage. It will then be submitted for approval in accordance with the provisions of Paragraph 2.4 of the Scheme of Delegation. 4.4 The current scheme includes the following provision which is sufficient and does not require amendment to facilitate the recommendations of the report . “The Chief Executive is the Leader of the Senior Leadership Group and has management responsibility for all Council employees. Without prejudice to the foregoing generality the Chief Executive’s powers, duties and responsibilities include the following: 10. To consider requests for voluntary early retirement or severance. 14. If a decision which is not delegated to officers requires to be made urgently between meetings of the Council or relevant Committee, the Chief Executive, in consultation (i) with the Provost or Leader of the Council as appropriate, and (ii) the Convener of the relevant Committee, may take action, subject to the matter being reported to the next meeting of the Council or relevant Committee.” 4.5 As stated in paragraph 4.2.5 above, restructures involving senior officers are remitted to the Recruitment and Individual Performance Committee and this would include changes at Chief Executive level. However, given the statutory requirement to appoint a Head of Paid Service in terms of Section 4 of the Local Government and Housing Act 1989, it would be unusual to allow the early retirement of this post-holder with access to unreduced pension benefits, Page 79
Page 80
with (strain on the fund) cost to the authority, inconsistent with best value principles as the payback principles are unlikely to be met. Key Principles of Public Life in Scotland 4.6 The Council’s Code of Conduct, most recently reviewed in November 2020, reflects the key principles in Section 2 and as such, are a cornerstone of the culture relevant to all officers. 4.7 However, the code omitted the additional principles of duty and respect, added by Scottish Government for public sector bodies in Scotland. This technical change has now been agreed with trade union colleagues without further recourse to committee in accordance with policy framework. 5. People Implications 5.1 There are no direct people implications arising from this report. 6. Financial and Procurement Implications 6.1 There are no direct financial or procurement implications arising from the report, other than those reported linked to any early retirements/voluntary severance situations. 7. Risk Analysis 7.1 There could be reputational risks associated with any decision to release employees which result in unreduced pension access, associated costs depending on which option is approved and a lack of robust justification. 7.2 The Council’s approach to early release in such circumstances mitigates the risks associated with these types of decisions. 8. Equalities Impact Assessment (EIA) 8.1 An Equality Impact Assessment was not required for the purposes of this report as it simply notes the content of the report and the safeguards already in place in the Council. 9. Consultation 9.1 The Trade Unions were advised of the audit report and the Council’s response at the meeting on 16 September 2025. 9.2 Colleagues in finance, legal, and HR were involved in the preparation of the report. 10. Strategic Assessment Page 80
Page 81
10.1 This proposal aligns with the Council’s strategic objective of delivering efficient and cost-effective services, contributing to its priority of being a “continuously improving Council delivering best value.” Victoria Rogers Chief Officer People & Technology Date: 11 November 2025 Person to contact: Victoria Rogers, Chief Officer People & Technology Appendix: Appendix 1 – Accounts Commission Letter to Councils Appendix 2 – Audit of Glasgow City Council, senior officer exit packages Background Papers: None Wards Affected: All Page 81
Page 82
Page 82
Page 83
4th Floor 102 West Port Edinburgh EH3 9DN T: 0131 625 1500 E: info@audit-scotland.gov.uk www.audit-scotland.gov.uk To All Leaders and Chief Executives 08 September 2025 Copied to: Directors of Finance; External auditors Dear Leader and Chief Executive, On 14 August, the Accounts Commission considered a report from the Controller of Audit (under powers in s102 (1) of the Local Government (Scotland) Act 1973) in relation to the scrutiny, governance and transparency of decision making of exit packages of senior officers in Glasgow City Council. The Controller highlighted issues and serious concerns on how decisions were made around these exit packages and set out the council’s response. The Commission welcomed the actions of the new chief executive in commissioning an internal review, an independent investigation of these issues and reporting the outcome publicly. I look forward to discussing this matter further with the Glasgow City Council when we meet in the coming weeks. In response to the Controller’s report, the Commission considered carefully the most appropriate way to use the powers available to it, including holding a hearing, making recommendations to Scottish Ministers or censuring in light of the concerning issues presented in the report. On this occasion, alongside publishing findings, it is vital that all councils take action to recognise the important learnings from this report. The Commission expects that this letter - also copied to Directors of Finance and external auditors - and the issues the report highlights, will be discussed by your audit and scrutiny committee. We expect that steps will be taken to review your Scheme of Delegation and decision-making processes. The Commission recognises that as councils continue to face financial challenges, service redesign and restructuring are key tools available to councils to respond to these challenges. However, transparency and good governance around decision-making is essential. The decisions of elected members and officers should uphold the nine Key Principles of Public Life in Scotland – selflessness, integrity, objectivity, accountability, openness, honesty, leadership, public services, respect. Sadly, the Commission believes that the way in which the restructuring packages were dealt with in this case did not. Where decisions around restructuring and exit packages are being taken, councils must ensure there is clear evidence of effective governance, independent scrutiny, and value for money, as well as robust and transparent record keeping. Lessons learnt are set out clearly in our report at paragraphs 46 - 48. Concerningly, this recent report is not the first time that this issue has been considered by the Accounts Commission. In 1997 and 2003, reports were published on managing early retirement and their key messages are as relevant today as they were then, not only for decisions relating to early retirement packages but also to any senior officer exit packages. Below are five key recommendations from the 2003 report, adapted for today’s context: Item 11 Appendix 1 Page 83
Page 84
1. Frameworks for decision-making: policies in relation to the exit packages of senior officers should be approved by councillors and reviewed regularly. 2. Informing councillors: councillors should receive a report at least annually that details the number of early retirals, and redundancy decisions made in the year, along with the associated costs and savings attached to these decisions. 3. Decision-making: councils should rigorously appraise individual business cases to ensure the expected savings associated with a retiral or redundancy outweigh the costs, ensuring value for money. 4. To improve accountability and assist in monitoring, the costs of early retirement should be charged to the appropriate service budget. 5. Elected members should be involved in approving early retirement and redundancy decisions for senior staff, providing the independent scrutiny that is essential to issues and decisions where there are potential conflicts of interest. I would urge all councils to take action now to ensure that all officers and members are familiar with the Key Principles of Public Life, and that you can evidence that your organisational culture respects and supports them fully. If you have any questions or queries in relation to the report on Glasgow City Council or on any other aspect of the Commission’s work, please do not hesitate to get in touch: acsupport@audit-scotland.gov.uk I look forward to engaging with you in the future. Yours sincerely, Andrew Burns Deputy Chair, Accounts Commission Page 84
Page 85
The 2023/24 audit of Glasgow City Council Senior officer exit packages Prepared by the Controller of Audit September 2025 Item 11 Appendix 2 Page 85
Page 86
The 2023/24 audit of Glasgow City Council | 2 Contents Commission findings 3 Introduction 6 How decisions were made 10 The council’s response 16 Accessibility You can find out more and read this report using assistive technology on our website www.audit.scot/accessibility. Page 86
Page 87
Commission findings | 3 Commission findings The Accounts Commission accepts the Controller of Audit’s report on a matter arising from the 2023/24 audit of Glasgow City Council in relation to the scrutiny, governance and transparency of decision-making of exit packages of senior officers. The Commission welcomes that the Controller used her powers to bring this issue to its attention, and notes she was able to draw on the independent investigation of the issue undertaken by Brodies LLP (on behalf of the council), as well as the annual audit report. The Brodies LLP report was itself supported by the report of a King's Counsel (KC), whom Brodies had instructed to review and provide an opinion on its investigation. Following consideration of the Controller’s report (presented at page 6) at its meeting on 14 August, the Commission has made the findings presented below. 1 The Commission welcomes the actions of the new chief executive of Glasgow City Council in commissioning an internal review and an independent investigation of these issues following discussions with appointed auditors, and for reporting the findings of the investigation publicly. We note that the 2023/24 annual audit report shows the council has accepted many of the recommendations and look forward to seeing the auditors’ review of progress in the 2024/25 annual audit. We expect the council to have strong evidence of good governance, scrutiny, and value for money and to present clear business cases for future restructuring. 2 Given that councils are required (under the under Section 4 of the Local Government and Housing Act 1989), to have a ‘head of paid service’, and that this is ordinarily the post of chief executive, we find it hard to understand how this post was part of a senior management restructuring package, developed in February 2021 (and presented in the ‘Restructure Report’), aimed at cost savings and efficiency. Within the final Restructure Report, an Executive Director post, deleted in January 2021, was linked to the early retirement of the chief executive, and subsequently included as part of payback period calculations. As the Brodies report states, the savings Page 87
Page 88
Commission findings | 4 associated with the deleted post had already been achieved. Based on the information considered, it is our view that the rationale for the former chief executive’s retirement contributing to efficiencies was, at best, unclear. 3 We consider that the restructuring package was dealt with in a manner inconsistent with the Key Principles of Public Life in Scotland, in particular selflessness, integrity and objectivity. The Restructure Report appears to have been approved by some individuals who then benefitted from its proposals. This exhibits a failure to address and document potential conflicts of interest (that should have been obvious to such senior and experienced officers) and displays a lack of judgement in relation to how their actions adhered to the principles. The council should take action to ensure that all officers and members are not only familiar with the principles but that the organisational culture respects and supports them fully. The council must also ensure that independent scrutiny is applied to issues and decisions where there are potential conflicts of interest. 4 Given the seniority of the officers associated with these exit packages, our clear view is that a full report should have been presented to the relevant committee for approval. Within the Scheme of Delegation used during this period, consideration of whether to involve elected members was a ‘judgement call’ by officers based on whether an issue could be considered politically controversial. Given the significance of the post of chief executive, linking it to efficiency savings should have been subject to independent scrutiny. Had elected members been involved at key stages, their scrutiny could have mitigated some of the justified criticisms around perceived conflicts of interest. 5 As councils continue to face financial challenges, service redesign and restructuring will be a necessary part of responding, so transparency around decision-making is essential. The decisions of elected members and officers should uphold the nine Key Principles of Public Life in Scotland – selflessness, integrity, objectivity, accountability, openness, honesty, leadership, public services, respect. Where decisions around restructuring and exit packages are being taken, councils must ensure there is clear evidence of effective governance, independent scrutiny, and robust and transparent record keeping. Page 88
Page 89
Commission findings | 5 6 It is alarming to see reports which need to consider the lawfulness of actions within councils, and such circumstances do little to reassure taxpayers about how public money is being used. Given the serious issues highlighted in the Controller’s report, the Commission considered carefully the most appropriate way to use the powers available to it, including holding a hearing, making recommendations to Scottish ministers or censuring in light of the concerning issues presented. In reaching our findings, we have considered the legal advice provided to Glasgow City Council and the action already taken. On this occasion, we have decided to take proactive steps to ensure that all local government bodies recognise the important lessons presented here, including writing to all council chief executives and leaders to highlight the importance of good governance and transparency in decision-making. Page 89
Page 90
Introduction | 6 Introduction 1. The Code of Audit Practice requires auditors to produce an Annual Audit Report (AAR) summarising the significant matters arising from their audit work. For local authorities, auditors address the AAR to elected members and the Controller of Audit. 2. I have received the Annual Audit Report and the audited annual accounts for Glasgow City Council (the council) for 2023/24. The appointed local auditor (Stephen Reid of Ernst & Young LLP (EY)) has issued a qualified audit opinion in relation to the council’s financial statements for the council and its group in respect of two City Building group entries for a second year. This reflected the impact of delays from previous years’ auditing of the accounts for these arm’s-length external organisations following a series of whistleblowing allegations in 2022. 3. The auditor also identified several risks, including the need for a robust medium- to longer-term financial strategy to reflect potential financial scenarios and support financial sustainability, as well as the need to agree a revised date for implementation of the new pay and grading structure. A total of 30 recommendations remain open, including 19 Grade 1(high risk) recommendations. I will monitor the council’s progress with addressing these issues through the audit team. I intend to bring a Best Value report to the Commission in August 2026 and will keep this under review with the appointed auditor including consideration of the pace of progress in implementing improvements. 4. The auditor also raised significant matters in the AAR in relation to the scrutiny, governance and transparency of decision-making in respect of the exit of five senior officers over the course of a three-year period between 2021 and 2024. I have decided to use the reporting powers available to me under s102 (1) of the Local Government (Scotland) Act 1973 to bring these matters to the Accounts Commission’s attention. 5. My report relies on a number of publicly available documents. Auditors have not undertaken primary evidence gathering such as interviews with current or former officials of Glasgow City Council. The report draws heavily on the independent review ‘Investigation into exit packages of former senior officials at Glasgow City Council’ undertaken by Brodies LLP, particularly for the ‘Background’ and ‘How decisions were made’ sections of the report. The independent review report is publicly available from Glasgow City Council. It was produced for the purposes of the council, and I appreciate the agreement of both the council and Brodies to use the content. I note that the parties who exited the council as part of the restructure of the Chief Executive’s Department were not interviewed, and Page 90
Page 91
Introduction | 7 not all had the opportunity to give evidence to the investigation carried out by Brodies. My report also draws on the work reported by the appointed auditor in the Annual Audit Report 2023/24. Background 6. In early 2021, a proposal was drafted setting out a restructure of the council’s Chief Executive’s Department, which included setting out the financial arrangements relating to the exit of five senior officers. The officers were: • the former solicitor to the council and director of governance • the former principal advisor to the chief executive • the former head of human resources • the former head of legal and administration and latterly director of legal and administration • the former chief executive. 7. The departures took place between April 2021 and May 2024. The total cost of the exit packages was £1.035 million with £0.268 million relating to redundancy payments and £0.77 million relating to strain on pension fund costs. The estimated ongoing savings in the proposal were £0.65 million per annum. Strain on pension fund costs are the additional cost incurred by a pension fund when a member retires early or receives benefits without actuarial reductions, often due to factors like redundancy or employer- approved early retirement. These costs arise because the fund needs to pay out benefits sooner or with less reduction than initially anticipated, requiring additional funding to cover the shortfall. 8. The leader of the council and city treasurer raised concerns after publication of the unaudited financial statements, which included details of the pension costs and payments in relation to loss of office, were published. The new chief executive launched an internal review into these matters which led to the commissioning of an independent review, including legal advice. 9. In March and April 2025, the outcome of the independent review was reported to three of the council’s committees for consideration. Subsequently, proposed changes to strengthen its governance arrangements in relation to workforce and service reform, were considered and agreed at a meeting of the council on 15 May 2025. A timeline of these events is set out in Exhibit 1. It is important to note that the Brodies independent investigation states that ‘we did not find any evidence Page 91
Page 92
Introduction | 8 allowing us to conclude that any recipient of any severance/retirement package, or any other officer, acted improperly’. Exhibit 1 Timeline of key events 2021 to 2024 January/February 2021 As part of planning for the restructuring of the council’s Chief Executive’s Department, a business case was developed which set out the proposed financial arrangements for the exit of five senior officers within the department. April 2021 The former solicitor to the council and director of governance left the council. She received a sum of £95,000 voluntary separation payment. July 2021 The former principal advisor to the chief executive left, receiving early unreduced access to her pension and redundancy, totalling benefits of just under £192,000. January 2023 The former head of human resources left, receiving early unreduced access to his pension and redundancy, totalling benefits of just under £148,000. September 2023 The former head of legal and administration (latterly the director) left, receiving early unreduced access to her pension and redundancy totalling benefits of £283,000. May 2024 The former chief executive left, receiving early unreduced access to her pension at a cost of £317,000 to the council. July 2024 The council published its unaudited financial statements, including the remuneration report, disclosing costs associated with the early retirement of the former chief executive and former director of legal and administration. August 2024 The accounts and financial statements were reported to the council’s Finance and Audit Scrutiny Committee. September 2024 An internal review was commissioned by the new chief executive to be performed by the council’s monitoring officer and head of audit and inspection. October 2024 The appointed auditor was notified about the internal review and about the restructure report. December 2024 The council instructed Brodies LLP to investigate and prepare an independent report on these matters. Page 92
Page 93
Introduction | 9 Timeline of key events 2025 February 2025 Brodies LLP provided the report of its investigation. This included the report of a King’s Counsel (KC), Brodies had instructed to review and provide an opinion on its investigation. March 2025 The council’s Finance and Audit Scrutiny Committee considered in public, a report by the chief executive on the findings of the independent investigation by Brodies of senior officer exit payments. This included provision of the full Brodies report and KC opinion. April 2025 The council’s Wellbeing, Equalities, Communities, Culture and Engagement Policy Committee considered a report setting out the findings and recommendations of the independent review of the arrangements for the chief officer departures. April 2025 A special meeting of the council’s Finance and Audit Scrutiny Committee was held to consider the annual accounts and annual audit report, including the external auditor’s comments on the exit payments. May 2025 The council’s City Administration Committee considered a paper on the review of arrangements for chief officer departures and proposed changes. May 2025 The former chief executive reached an agreement with Strathclyde Pension Fund which, with the approval of the council, resulted in repayment to the council of the strain on the fund cost associated with her early retirement. May 2025 Glasgow City Council agreed proposed changes to the terms of reference of committees and the scheme of delegated functions, in response to the independent review. Source: Audit Scotland Page 93
Page 94
How decisions were made | 10 How decisions were made The approach taken to the restructuring of the senior management of the Chief Executive’s Department The role of the Chief Executive’s Department 10. The Chief Executive’s Department in a council is the strategic planning and management centre of the organisation. It provides the corporate lead, advice and support to its other departments and functions. It also provides the lead for governance and support to councillors with their policy-setting, decision-making and scrutiny role. 11. In Glasgow City Council, the main services of the Chief Executive’s Department include for example: Policy, Corporate governance and communication; Legal and administration; Human resources; Corporate procurement; Digital services; Customer care; Financial inclusion and Economic development. Restructuring requires good governance 12. Whether as part of improvement and/or savings programmes, councils need to undertake organisational and staff restructuring from time to time. It allows the organisation to realign its resources to respond to change or to new priorities and find ways to work more efficiently. This can include redeployment or reductions of senior officers through early retirement or redundancy packages. 13. It is important that decisions made about restructuring, including exit packages for senior staff, are undertaken in the most transparent manner with clear governance arrangements that reflect the principles of public life in Scotland (Exhibit 2). In addition to demonstrating high standards of governance, councils also need to demonstrate that decisions about restructuring and exit packages are value for money for the public purse. Page 94
Page 95
How decisions were made | 11 Exhibit 2 Principles of public life There are expectations on how elected members and officers of public bodies, including councils, conduct themselves and the work they undertake. In 1995, the Committee on Standards in Public Life (the Nolan Committee) identified seven principles of conduct underpinning public life. In Scotland these principles were expanded to include a further two into the Nine Principles of Public Life in Scotland 1. Selflessness Acting solely in the public interest. 2. Integrity Avoiding obligations that might influence official duties. 3. Objectivity Making decisions impartially and on merit. 4. Accountability Being answerable to the public and open to scrutiny. 5. Openness Acting transparently and justifying decisions. 6. Honesty Being truthful and declaring conflicts of interest. 7. Leadership Promoting and upholding these principles through example. 8. Public service Acting in the interests of the public body and fulfilling its core tasks. 9. Respect Treating colleagues and staff with courtesy and valuing their roles. Source: Scottish Government/Audit Scotland How decisions were made The process for approving the business case for restructuring the senior management of the Chief Executive’s Department is not formally documented 14. The independent investigation by Brodies LLP sets out that following a discussion in January 2021, the head of human resources sent the former chief executive a business case in February 2021, entitled Proposed Senior Management Restructure Report. This report set out the proposed financial arrangements relating to the exit of five senior officers within the Chief Executive’s Department. The report proposed that: Page 95
Page 96
How decisions were made | 12 • the post of solicitor to the council and director of governance (Grade 13) be made redundant, with its functions merged into other senior roles. A new role of solicitor to the council and monitoring officer (Grade 12) would be created • the post of solicitor to the council and monitoring officer be subject to a ‘bump redundancy’, and a legal manager post (Grade 10) deleted • the post of principal adviser to the chief executive (Grade 11) be made redundant, with its functions merged into a new head of performance and governance role • the post of head of human resources (Grade 11) be subject to a bump redundancy, and a strategic HR manager post (Grade 11) deleted • the chief executive (Grade 15) take early retirement in or around late 2022 on grounds of efficiency, with an estimated cost of £349,095. Bump redundancy (or transferred redundancy) generally refers to an employee at risk of redundancy being moved into another role within the organisation. The person currently in that role is then made redundant instead. 15. In February 2021, the former executive director of finance sent an email to the chief executive stating: ‘I can confirm that each individual case and the overall project are consistent with council policy and the business case is comfortably within target parameters. I am therefore fully supportive of the proposals as outlined in the paper.’ There is no explicit evidence of the chief executive, the director of governance and solicitor to the council approving the restructure report, as required at that time by the scheme of delegated functions. The independent review concludes that it is implicit in the collective correspondence about the report. There does not appear to be a clear document trail recording definitively the decision- making in relation to approval of the restructure report. Approval of the exit and the terms for four of the five officers were in line with policy 16. The independent review concluded that approval requirements were met for the exit terms of the solicitor to the council, the principal advisor to the chief executive, head of/director of legal and administration and head of human resources. 17. The exit terms offered to four of the former officers were in line with the council’s policies in terms of redundancy payments, pension strain costs and payback periods. Page 96
Page 97
How decisions were made | 13 18. The independent review concludes that ‘it is not clear whether [the solicitor to the council’s] departure can be said to fall within the scope of the council’s policies on redundancy and early retirement’ as it was not formally a redundancy. She received a severance payment of £95,000 as an agreed sum to be paid on her resignation. She did not receive redundancy or early access to her pension. Approval of the chief executive’s exit did not follow the scheme of delegated functions 19. There was no specific provision for approval of the early retirement or severance of the chief executive under the scheme of delegated functions. 20. The former chief executive highlighted in her statement to the independent review that in her view, as the role didn’t fall under ‘chief officials’ that the scheme permitted her to delegate approval to the executive director of finance and head of human resources, as for non- chief officials. Her view is the approval was given at the time the restructure report was written in 2021. 21. The independent review also draws attention to an email in March 2024 from an HR officer sent to both the new head of human resources and the executive director of finance with the request for the former chief executive’s early retirement, which was approved on the same day. The independent review notes, however, that it appears that the executive director of finance and the new head of human resources did not consider they were formally approving the application but that their function was to check the application complied with relevant council policies. Elected members were not involved in decision-making or approval processes 22. The scheme includes the general requirement on officers ‘where he/she considers that a matter may be politically controversial even although it has been specifically delegated to him/her, to consult with the appropriate city convener. If after consultation the officer determines the matter is politically controversial, it must be referred to committee as appropriate for approval’. 23. What can be considered politically controversial is a judgement, however it is reasonable to consider the early retirement of the chief executive on efficiency grounds, and the operational and financial implications of this could meet this description, and it is not clear what consideration was given to this issue. The independent review concluded that officers should have referred the restructure report to the relevant city convenor for consultation as a matter of potential political controversy. 24. Councillors do not, however, appear to have been involved in the decision-making or approval processes for the exit packages for any of the five senior officers, including the chief executive. There is no evidence of the proposals and terms being discussed with councillors and the Page 97
Page 98
How decisions were made | 14 restructure report was not shared with councillors or presented at committee for approval. Appropriate scrutiny, transparency and accountability was lacking 25. As highlighted at paragraph nine, it is important to note that the independent investigation states that ‘we did not find any evidence allowing us to conclude that any recipient of any severance/retirement package, or any other officer, acted improperly’. However, in the interests of transparency and good governance, the absence of a clear document trail, setting out the decisions and approvals required for the restructure report, including the consideration of potential conflicts of interest and the need to involve councillors, is concerning. 26. I support the auditor’s conclusions in his 2023/24 AAR that ‘the council was unable to demonstrate effective scrutiny, governance and transparency in decision-making or value for money in respect of the exit of five senior officers over the course of a three-year period between 2021 and 2024’. It is not clear whether the restructure was value for money. All councils should ensure that they can demonstrate the value for money for any service reform or restructure. In this case, the council’s restructure paper highlights two key reasons for the structural change: • the ongoing requirement to make significant savings; and • a need to address the demographics of the senior team and put in place robust succession planning arrangements. 27. The restructure report concluded that the total cost of the proposals would be £731,486, with ongoing annual savings of £652,658, resulting in a payback period of 1.12 years. However, the detail of the report sets out total redundancy and strain on the fund costs of £1.025 million for the five senior officers. The council advises that the lower cost of £731,846 is after in-year salary savings are included. 28. The appointed auditor notes in the AAR that the actual total cost of the exit of the five senior officers was £1.035 million as opposed to the cost of the proposals in the restructure report of £1.025 million. The difference reflects updated figures since the time of the business case in 2021, as well as changes to planned leaving dates. 29. It is not possible to reach a conclusion on the rationale for the exit terms given to the five senior officers, as there is a lack of consideration within the restructure report of the benefits to the council for the reform (outwith the overall annual financial savings of £0.65 million). 30. There is no reference within the restructure report to alternative mechanisms for change being considered. The auditor comments in the AAR that ‘while we note in circumstances where restructures involve senior officers, alternative options such as redeployment are often not Page 98
Page 99
How decisions were made | 15 practical or possible, we would expect consideration of all options to be evaluated. In this specific instance, it’s unclear why early retirement and redundancy was the best solution to address concerns around succession planning’. 31. It is particularly difficult to see the justification for the chief executive’s early retirement on the grounds of cost savings and succession planning, as the post of chief executive remains within the structure. In February 2024, the request to approve the terms of the chief executive’s early retirement, made to the head of human resources and the executive director of finance for approval, was made on the grounds of efficiency. 32. A final amendment made to the restructure report before its approval by officers was to include a link between the deletion of the post of executive director of development and regeneration services and the early retirement of the chief executive. The deletion of the role was approved by the council’s City Administration Committee in January 2021, but the rationale for the link to support the case for the chief executive’s retirement contributing to savings is unclear. Page 99
Page 100
The council’s response | 16 The council’s response How the council are taking action to address the issues raised The council’s response and actions taken The council commissioned an independent review and reported publicly on the findings 33. In September 2024, the council’s new chief executive commissioned the council’s monitoring officer and head of audit and inspection to undertake an internal review of the arrangements for the departure of senior officers. 34. Following consideration of the findings of the internal review and discussion of the findings with the appointed auditor, the council sought an independent legal view. Brodies LLP was instructed to undertake an independent investigation. Brodies provided their report in February 2025. This included the opinion of a KC on the questions of law asked by the council, based on the findings in the Brodies LLP report. 35. A summary of findings from the Brodies LLP report, are set out in Exhibit 3. The full report, with the opinion provided by the KC, is available from Glasgow City Council. Page 100
Page 101
The council’s response | 17 Exhibit 3 Key findings of independent legal review Severance terms offered to each of the officers were in accordance with applicable council policies. The justification for the early retirement of the former chief executive was not supported by the restructure report or accompanying correspondence and there was no clear justification for linking her retirement with the deletion of the post of executive director of development and regeneration services. The restructure report should have been the subject of elected member input, rather than being approved solely by officers, particularly as the officers who were involved in approving it also benefitted from its terms by being proposed for early retirement/severance packages. No evidence was found that elected members were asked to approve the report or individual applications for severance/retirement. There was also no evidence that elected members had any knowledge of the details of the departures prior to the publication of the remuneration report as part of the unaudited annual accounts for 2023/24. It is considered that the former chief executive’s application for early retirement was not, on the face of it, lawfully approved in terms of the council’s Scheme of Delegated Functions. However, it was considered unlikely that a judicial review would overturn the decision, given the detriment to the former chief executive and the time passed. That the pension strain costs which formed part of four of the five redundancy/early retirement packages under investigation were mandatory in terms of the council’s policy and the Local Government Pension Scheme Regulations. It is considered that there is no reasonable basis for the recovery of the sums paid by the council in respect of the five early retirement/redundancy packages. Source: Brodies LLP report: Investigation into exit packages of former senior officers at Glasgow City Council and Opinion of senior counsel in re. Investigation into exit packages of former senior officers at Glasgow City Council 36. The council presented the legally privileged report from Brodies LLP and the opinion from the KC in public to the Finance and Audit Scrutiny Committee on 11 March 2025. The council’s decision to consider the findings of the independent review in public, indicates a desire to ensure greater transparency and openness on the matter, which is welcome. Page 101
Page 102
The council’s response | 18 The council are making updates to governance structures and policy 37. An internal review of the council’s governance arrangements relating to workforce and service reform activity has been undertaken. In response to the issues highlighted by the independent review and recommendations from the appointed auditor, the council is making amendments to governance arrangements and policy in respect of early retirement and voluntary redundancy. 38. At the May 2025 council meeting, amendments to the Scheme of Delegated Functions and Committee Terms of Reference were agreed. The amendments to arrangements include: • Clarity in the scheme that the term chief officers refers to all officers grade 12 and above, including the chief executive. • Changing the title of the Senior Officer Appointment Committee to the Senior Officer Workforce Committee and changing the remit to consider not only appointments of senior officers but also the approval of proposals involving early retirement or redundancy of officers of grade 12 or above. • Adding the director of legal and administration to the senior officers required to approve changes to staffing structures, numbers and gradings. • Deleting the previous delegation, which authorised the chief executive to approve applications from chief officials for early retirement and voluntary severance. • Adding an express delegation relating to the early retirement and voluntary severance of the chief executive, giving authority to the Chair of the Corporate Workforce Planning Board to recommend proposals to the Senior Officer Workforce Committee. 39. The auditor makes the recommendation in the AAR that the council should ‘set clear guidance on minimum expectations for any future restructure papers. This should include at a minimum an outline of how the restructure achieves value for money, what alternatives to early retirement or voluntary redundancy were considered and how the restructure meets the council’s strategic priorities. The council accepted this recommendation and have committed to set clear guidance for future restructure papers and to establish a Corporate Workforce Planning Board to oversee the implementation. 40. In addition, the council have committed to make improvements to the administration of exit packages in response to areas for improvement identified by the appointed auditor in the AAR. The recommendations include: Page 102
Page 103
The council’s response | 19 • The council should engage with Strathclyde Pension Fund to ensure that strain on fund calculations are only made for relevant individuals and consider whether any amendments are required to improve the accuracy of estimated costs. • Management should review the current operational processes for recording approvals and agreements to early retirements and redundancies. This should include clear guidance on requirements for electronic approvals. 41. The auditor notes in the AAR that ‘further work will be required to ensure that such arrangements are adhered to and the Nolan principles are upheld in future’. The council report that it ‘will put in place arrangements to enhance and monitor awareness, understanding and application of the council’s governance rules across senior management and leadership teams. This will be extended to include the employees’ Code of Conduct, with appropriate training and communication carried out with employees across the council family’. No legal basis for recovery 42. The independent review concluded that there is no reasonable basis for the recovery of the sums paid by the council in respect of the five early retirement/redundancy packages. The current chief executive advised that in early May 2025, legal representation for the former chief executive arranged for an agreement to be made with Strathclyde Pension Fund and the council. This resulted in the repayment, from Strathclyde Pension Fund to the council, of the strain on the pension fund of £317,000, stemming from her early retirement. Glasgow City and other councils need to ensure good governance, value for money and clear business cases for future reform and restructuring The council needs to ensure it is better prepared for future restructuring 43. Councils should not turn to early retirement as the first and only option when faced with budget cuts. The need for early retirements could be better controlled by taking a strategic approach to planning the size and composition of the workforce, including senior roles. 44. Best Value thematic work undertaken at the council has highlighted that while detailed workforce planning occurs at a service level, there is no overall workforce plan or strategy. The council need to be able to show, how any restructure provides value for money including how any restructures support the council’s strategic plan, financial plans and workforce plans. 45. As the council looks to continue to transform and ensure it is fit for the future, it will need to demonstrate that: Page 103
Page 104
The council’s response | 20 • the planned restructure achieves value for money • the revised structure reflects the council’s strategic priorities • alternatives to early retirement or voluntary redundancy have been considered • the process for approving early retirements and redundancies is clearly documented • the decision-making process is subject to appropriate scrutiny and is in line with the principles of public life. Lessons learnt for all councils 46. Given the current challenging financial context across the public sector, other councils will also be undertaking restructuring and reform programmes. They too need to ensure that they have effective governance arrangements in place. In particular, all councils will wish to consider: • Are their schemes of delegation and codes of conduct fit for purpose and do they reflect the principles of public life? • Does the scheme of delegation include a clear process for considering proposals and approvals for restructure, redundancy and retirement and does it appropriately manage potential conflicts of interest? • Is there appropriate officer and councillor scrutiny of the decision- making processes in relation to restructure, redundancy and retirement? • Is there a good understanding and implementation of the requirements set out in the scheme of delegation relating to restructure, redundancy and retirement, through training and monitoring? • Does the prevailing culture among senior officers reflect the standards and behaviours required by the principles of public life? 47. The Accounts Commission produced a report in 1997 and follow-up review about the management of early retirement. These were: • Bye now, pay later? The management of early retirement in local government – December 1997 • Bye now, pay later? A follow-up review of the management of early retirement – June 2003 48. Messages from these reports remain relevant and councils should remain cognisant of these as they undertake restructuring and reorganisation that includes the early exit of senior members of staff, Page 104
Page 105
The council’s response | 21 senior council members and senior staff in bodies in the group accounts. Listed below are recommendations from the 2003 report of note: • Framework for decision-making: early retirement policies should be approved by councillors and be reviewed regularly. • Informing councillors: councillors should receive a report at least annually that details the number of early retiral decisions made in the year, along with the associated costs and savings attached to these decisions. • Decision-making: councils should rigorously appraise individual cases to ensure the expected savings associated with a retiral outweigh the costs. • To improve accountability and assist in monitoring, the costs of early retirement should be charged to the appropriate service budget. • Elected members should be involved in approving early retirement decisions for senior staff. Page 105
Page 106
The 2023/24 audit of Glasgow City Council Senior officer exit packages Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN Phone: 0131 625 1500 Email: info@audit.scot www.audit.scot ISBN: 978 1 915839 81 7 AS.5.0 Page 106
Page 107
WEST DUNBARTONSHIRE COUNCIL Report by Chief Officer – Resources Audit Committee - 10 December 2025 Subject: External Audit Enquiries – 2024/25 Accounts 1. Purpose 1.1 The purpose of this report is to: inform members of External Audit’s requirement for the provision of information regarding the Council’s approach to dealing with fraud, litigation, laws and regulations as part of their audit of the Council’s 2024/25 Statement of Accounts and 2024/25 Trust Accounts. allow members to comment on the response related to ‘Those Charged with Governance’. 2. Recommendations 2.1 It is recommended the Audit Committee: consider the enquiries for those charged with governance for the 2024/25 Council Accounts and 2024/25 Trust Accounts approve the submission of the draft responses set out in appendix 1 for the Council and appendix 2 for the Trust Funds to the Council’s external auditors. 3. Background 3.1 As part of the annual audit approach taken by the Council’s external auditors, Forvis Mazars (Mazars), they seek responses to a range of enquiries concerning the Council’s approach and reporting arrangements for a number of key areas relating to themes surrounding fraud, litigation, laws and regulations together with some areas specific to the accounts such as related parties and estimates used in the accounts. The responses to these provided by officers will inform the approach taken by Mazars to the audit of the 2024/25 Accounts. 4. Main Issues 4.1. In addition to the officer enquiries, Mazars require a response to several enquiries relating to the arrangements for identifying, responding to and managing risks around fraud from ‘those charged with governance’. Details of the specific enquiries and a proposed response to each is provided in Appendix 1 for the Council and 2 for the Trust Funds for members to review and comment on ahead of agreeing the final version for submission to Mazars. 5. People Implications 5.1 There are no people implications. Item 12 Page 107
Page 108
6. Financial and Procurement Implications 6.1 There are no financial implications arising from this report. 6.2 There are no procurement implications arising from this report. 7. Risk Analysis 7.1 There are no specific risk implications arising from this report. 8. Equalities Impact Assessment (EIA) 8.1 There are no direct equalities impacts arising from the report. 9. Consultation 9.1 This report has been subject to consultation with appropriate Chief Officers. 10. Strategic Assessment 10.1 This report relates to strong corporate governance. .................................... Laurence Slavin Chief Officer - Resources Date: 10 December 2025 Person to Contact: Laurence Slavin, Chief Officer - Resources E-mail: laurence.slavin@west-dunbarton.gov.uk Appendices: 1 – External Audit Enquiries for Those Charged with Governance (WDC) 2 – External Audit Enquires for Those Charged with Go vernance (Trust Funds) Background Papers: None Wards Affected: All wards Page 2Page 108
Page 109
Item 12 Appendix 1 International Standard for Auditing 240 - The auditor’s responsibility to consider fraud in an audit of financial statements 1) How does the Committee, in its role as those charged with governance, exercise oversight of management's processes in relation to: undertaking an assessment of the risk that the financial statements may be materially misstated due to fraud or error (including the nature, extent and frequency of these assessments); identifying and responding to risks of fraud in the organisation, including any specific risks of fraud which management have identified or that have been brought to its attention, or classes of transactions, account balances, or disclosure for which a risk of fraud is likely to exist; communicating to employees of views on business practice and ethical behaviour (for example by updating, communicating and monitoring against the organisation’s code of conduct); and communicating to those charged with governance the processes for identifying and responding to fraud or error? Response The Council’s financial statements are prepared by experienced and professionally qualified accountants who are regulated by the standards of their respective institutes. The financial statements reflect the transactions which have been processed by the Council’s financial systems. These systems are protected by internal controls and procedures which are periodically reviewed and tested by internal audit and our external auditors. Consequently, although the material misstatement cannot be ruled out, its likelihood is low. The Audit Committee provides oversight and challenge in relation to the financial statements and seeks assurances from the Chief Officer - Resources that the accounts are not materially misstated. Updates are provided to Audit Committee and/or full Council on key areas of the statement, any changes in accounting policies and their impact on the statements. The Audit Committee plays a key oversight role in relation to fraud and error identification. The Committee receives regular progress reports on anti-fraud activities taking place within the Council. The Council has a code of conduct which describes the standards of conduct and practice which all Council employees should follow. The code of conduct is a key component of the Council’s Code of Good Governance. The Council’s Whistleblowing Policy enables any individual to register, in confidence, any concerns regarding alleged misconduct and fraudulent or corrupt activity. This can be found on the Council’s website and intranet. 2) How does the Committee oversee management processes to identify and respond to the risk of fraud and possible breaches of internal control? Is the Committee aware of any breaches of internal control during 2024/25? Please provide details. Response It is the responsibility of management to develop and maintain sound systems of risk management, governance and internal control. This includes the requirement to identify and respond to any identified breaches of internal control. However it is noted that internal control systems, no matter how well designed and operated, are affected by inherent limitations. These include the possibility of poor judgement in decision making; human error; control processes being deliberately circumvented by employees and others; management overriding controls and Page 109
Page 110
Appendix 1 unforeseeable circumstances. In terms of oversight, the Council’s Internal Audit function plays a key role in this regard. Internal Audit work is not a substitute for management’s responsibilities for the design and operation of these systems, and is not responsible for identifying all significant control failures. However, the Internal Audit team has an important role in providing assurance on the Council’s control environment and providing a view on the Council’s processes for identifying control failures, and endeavours to plan its work so that work is focused on those areas where there is higher risk. A risk-based audit plan is produced annually based on best practice, taking cognisance of the strategic and operational risk registers and engagement with senior managers. The methodology for prioritising audit work is set out in the audit strategy and plan. Findings are reported as Red, Amber or Green which aligns with the Council’s risk management strategy. Red and Amber findings are reported to Audit Committee together with management’s agreed actions to address these issues. The Audit Committee receive a range of assurances/reports during the year which touch upon aspects of internal control. Reports in 2024/25 have included: Annual Audit Plans from internal and external audit Annual Internal Audit Report and Assurance Statement Internal Audit progress reports Code of Good Governance and the Annual Governance Statement Accounting policies, Annual Accounts and External audit Annual Report Treasury management annual report and updates Regular reports on National Fraud Initiative Risk management update on Strategic Risk register Annual Complaints Report Responses to External Audit Enquiries to Those Charged with Governance Where deemed necessary the Audit Committee will ask that a relevant officer of the Council is present at Audit Committee meetings to respond to questions on a report being presented. 3) Has the Committee knowledge of any actual, suspected or alleged fraud during the period 1 April 2024 – 31 March 2025? Where appropriate please provide details. Response A number of suspected/alleged instances of fraud occurred during 2024/25. These are detailed within the regular reports to Audit Committee. Cases included those relating to housing benefit/council tax and misuse of council resources. 4) Has the Committee any suspicion that fraud may be occurring within the organisation? Please provide details. Has the Committee identified any specific fraud risks within the organisation? Please provide details. Does the Committee have any concerns that there are areas within the organisation that are at risk of fraud? Please provide details. Are there particular locations within the organisation where fraud is more likely to occur? Please provide details. Response As with any large and complex organisation there are a range of fraud risks and emphasis on reducing fraud risk is continuous. The results of the NFI, internal audit work and reported fraud show some low value frauds. Management and the Audit Committee is kept up to date with fraud risks through updates on counter fraud arrangements, Internal Audit and other ad hoc reports. Page 110
Page 111
Appendix 1 Fraud risks are acknowledged in key areas. Members and officers are aware of these and the risks are managed through established risk management processes. 5) Is the Committee satisfied that internal controls, including segregation of duties, exist and work effectively? Please provide details. If not, where are the risk areas? What other controls are in place to help prevent, deter or detect fraud? Response Key controls such as the segregation of duties, management review and supervision and authorisation and approval are evident in each of the Council’s core systems. It is acknowledged that maintaining an effective control environment is challenging in a time of reducing resources and a changing operating environment. For this reason, internal audit will have a continued role in supporting the Council in ensuring that an adequate but appropriate control environment is in place. In overall terms, Internal Audit have concluded that reasonable assurance can be provided on the Council’s system of internal control for 2024/25. 6) Is the Committee satisfied that staff are encouraged to report their concerns about fraud, and the types of concerns they are expected to report? Please provide details. Response The Council promotes a zero tolerance toward fraud and promotes a culture that enables individuals to identify potential fraud and empowers them to report their concerns in a safe and secure manner to the appropriate people at the right time. The means by which employees can report fraud are publicised on the Council’s intranet. Fraud issues are widely communicated both internally and externally to provides a deterrent to fraudsters by highlighting the Council’s commitment to identify fraud and take proactive action to pursue fraudsters. 7) From a fraud and corruption perspective, what are considered by the Committee to be high risk posts within the organisation? Please provide details. How are the risks relating to these posts identified, assessed and managed? Response Fraud and corruption, and associated risks, come in many forms and, consequently, it is not easy to specifically identify specific posts where there are greater risks than others. However there is a general recognition that there is an inherent risk of fraud within an organisation like a Council and the risk of fraud is managed through existing controls and procedures which are in place across the organisation. The Committee takes assurance from the work of internal audit, the established fraud policies in place and ongoing embedding of a culture of fraud awareness through a programme of anti-fraud training and the work of the Council’s fraud team. This helps ensure that issues identified as a result of Internal Audit work or fraud investigations, result in recommendations to management to address gaps in control to ensure that risks are properly mitigated to acceptable levels. 8) Is the Committee aware of any related party relationships or transactions that could give rise to instances of fraud? Please provide details. How are the risks associated with fraud related to such relationships and transactions mitigated? Response We are not aware of any related party relationships or transactions that could give rise to instances of fraud. Disclosure of significant related party relationships is required for both members and officers in positions of influence. Page 111
Page 112
Appendix 1 9) Is the Committee aware of any entries made in the accounting records of the organisation that it believes or suspects are false or intentionally misleading? Please provide details. Are there particular balances where fraud is more likely to occur? Please provide details. Is the Committee aware of any assets, liabilities or transactions that it believes were improperly included or omitted from the accounts of the organisation? Please provide details. Could a false accounting entry escape detection? If so, how? Are there any external fraud risk factors which are high risk of fraud? Please provide details. Response We are not aware of any accounting entries which are suspected to be false or intentionally misleading. Should management become aware of any suspect accounting entries, these would be subject to immediate investigation through Internal Audit. We are not aware of any assets, liabilities or transactions that have been improperly included or omitted from the Council’s accounts. Should any issues arise it is expected that these would be identified through review and approvals processes. The Council is a complex multidisciplinary organisation so there is a risk that management is unaware of any potential false accounting occurring however this is unlikely given the controls in place for processing transactions. An added control in this area is the review by the external audit team who provide added assurance for transactions which are in excess of the materiality value. Current and emerging risks are identified from a number of sources including the National Anti-Fraud Network (NAFN) and other law enforcement agencies. These are disseminated to relevant Council teams to raise awareness. 10) Is the Committee aware of any organisational, or management pressure to meet financial or operating targets? Please provide details. Is the Committee aware of any inappropriate organisational or management pressure being applied, or incentives offered, to you or colleagues to meet financial or operating targets? Please provide details. Response The Committee understands that the Council has financial and operating targets to meet and these are progressed through normal management arrangements. However we are not aware of any inappropriate organisational or management pressure to meet financial or operating targets and there is no evidence of any incentive ever being offered to do so.. Monthly budget monitoring is conducted with Chief Officers and service managers and reconciliations of key balances are conducted monthly, and significant variances are investigated. There is regular reporting on Budgetary Control to relevant committees. International Standard for Auditing 250 – Consideration of laws and regulations in an audit of financial statements 11) How does the Committee gain assurance that all relevant laws and regulations have been complied with. For example: Is the Committee aware of the process management has in place for identifying and responding to changes in laws and regulations? Please provide details. What arrangements are in place for the Committee to oversee this process? Is the Committee aware of the arrangements management have in place, for communicating with employees, non-executive directors, partners and stakeholders regarding the relevant laws and regulations that need to be followed? Please provide details. Page 112
Page 113
Appendix 1 Does the Committee have knowledge of actual or suspected instances where appropriate laws and regulations have not been complied with, and if so is it aware of what actions management is taking to address it? Please provide details. Response The Council is subject to a range of legal and regulatory frameworks. The Council has a Local Code of Good Governance and has appointed a Monitoring Officer (Chief Officer Regulatory and Regeneration) to ensure that the Council acts lawfully. All committee reports are subject to legal review and comment to ensure key issues are identified. The Council’s Chief Officer Regulatory and Regeneration is a member of the Senior Management Team and is sighted on any new strategic projects or initiatives with the Council’s Legal Services having specialist officers who provide legal advice and support to particular service areas. As required, training is provided to officers on particular legal issues, some of it being mandatory, for example around data protection and equalities. Accepting that there will be minor operational instances of non-compliance, we are not aware of any instances of significant non-compliance during the financial year. This is supported by the annual review of the Local Code of Good Governance. International Standard for Auditing 501 – Specific consideration of the potential for, and actual, litigation and claims affecting the financial statements 12) Is the Committee aware of any actual or potential litigation or claims that would affect the financial statements? Please provide details. Response The Council’s financial statements disclose contingent liabilities and any provisions for legal claims. The Council’s s95 Officer engages with members of the Council’s Senior Management Team, including the Chief officer Regulatory and Regeneration Service (Council’s Monitoring Officer) as part of the annual accounts preparation process to identify any ongoing or potential cases which require disclosure in the financial statements. International Standard for Auditing 570 – Consideration of the going concern assumption in an audit of financial statements 13) How has the Committee assessed and satisfied itself that it is appropriate to adopt the going concern basis in preparing the financial statements? Response Going concern has been assessed as part of Council’s budget setting process in March 2025. The budget setting process requires the Council’s s95 Officer (Chief Officer - Resources) to provide a view on the robustness of estimates and the adequacy of reserves. No issues in relation to going concern were highlighted as part of the report presented to the Council in October 2025. 14) Has the Committee identified any events or conditions since the assessment was undertaken which may cast significant doubt on the organisation’s ability to continue as a going concern? Please provide details. Response The Council agreed a balanced 2025/26 budget on 5 March 2025 and that report presented future budget gaps that will need to be closed in subsequent years. This is consistent with all Scottish local authorities and reflects the financial climate local authorities are operating in with ongoing real terms funding reductions. The Council delivers a number of non-statutory services which, if required could be reduced or stopped in the event that insufficient funding is made available. Therefore, whilst the Council does Page 113
Page 114
Appendix 1 have future budget gaps, there are viable options available to close the gap meaning there is not a risk to the Council’s ability to continue as a going concern. Page 114
Page 115
Item 12 Appendix 2 International Standard for Auditing 240 - The auditor’s responsibility to consider fraud in an audit of financial statements 1) How do the Trustee’s, in their role as those charged with governance, exercise oversight of management's processes in relation to: undertaking an assessment of the risk that the financial statements may be materially misstated due to fraud or error (including the nature, extent and frequency of these assessments); identifying and responding to risks of fraud in the organisation, including any specific risks of fraud which management have identified or that have been brought to its attention, or classes of transactions, account balances, or disclosure for which a risk of fraud is likely to exist; communicating to employees of views on business practice and ethical behaviour (for example by updating, communicating and monitoring against the organisation’s code of conduct); and communicating to those charged with governance the processes for identifying and responding to fraud or error? Response The Annual Governance Statement within West Dunbartonshire Council’s (WDC) annual financial statements contains a review of the adequacy and effectiveness of the governance framework including the system of internal control. These systems are periodically reviewed and tested by internal audit, and our external auditors. Consequently although the material misstatement cannot be ruled out, its likelihood is low. All financial transactions relating to the delivery of the Trusts are hosted within the WDC ledger, therefore the Trusts rely on the processes and controls implemented by WDC including approval and authorisation processes, defined limits for all authorised signatories and adherence to WDC Financial Regulations. The financial statements reflect the transactions which have been processed by the WDC financial system. The Trust’s financial statements are prepared by experienced and professionally qualified accountants who are regulated by the standards of their respective institutes. The WDC Chief Internal Auditor provides regular reports to the Audit Committee which include information on control issues identified within the partner organisations and any potential impact on the Trusts. If the Trustees became aware of any fraud or suspected fraud then appropriate reporting processes would be followed e.g. the Chief officer - resources would be notified in conjunction with reporting to Internal Audit, Fraud Liaison Officer or Legal teams for cases involving suspected data breaches. Through the Code of Conduct for Staff, all WDC employed staff are obliged to comply with the partner’s Corporate Governance documentation, which includes the responsibilities of managers and other staff arising from the Financial Regulations, SFIs and Fraud Policies – all available on WDC websites and intranet 2) How does the Trust oversee management processes to identify and respond to the risk of fraud and possible breaches of internal control? Is the Trust aware of any breaches of internal control during 2024/25? Please provide details. Response It is the responsibility of management to develop and maintain sound systems of risk management, governance and internal control. This includes the requirement to identify and respond to any identified breaches of internal control. However it is noted that internal control systems, no matter how well designed and Page 115
Page 116
Appendix 2 operated, are affected by inherent limitations. These include the possibility of poor judgement in decision making; human error; control processes being deliberately circumvented by employees and others; management overriding controls and unforeseeable circumstances. In terms of oversight, the Council’s Internal Audit function plays a key role in this regard. Internal Audit work is not a substitute for management’s responsibilities for the design and operation of these systems, and is not responsible for identifying all significant control failures. Where deemed necessary the Audit Committee will ask that a relevant officer of the Trust is present at Audit Committee meetings to respond to questions on a report being presented. 3) Has the Trust knowledge of any actual, suspected or alleged fraud during the period 1 April 2024 – 31 March 2025? Where appropriate please provide details. Response There have been no suspected/alleged instances of fraud during 2024/25. 4) Has the Trust any suspicion that fraud may be occurring within the organisation? Please provide details. Has the Trust identified any specific fraud risks within the organisation? Please provide details. Does the Trust have any concerns that there are areas within the organisation that are at risk of fraud? Please provide details. Are there particular locations within the organisation where fraud is more likely to occur? Please provide details. Response As with any large and complex organisation there are a range of fraud risks and emphasis on reducing fraud risk is continuous. The results of the NFI, internal audit work and reported fraud show some low value frauds. Management and the Audit Committee is kept up to date with fraud risks through updates on counter fraud arrangements, Internal Audit and other ad hoc reports. Fraud risks are acknowledged in key areas. Members and officers are aware of these and the risks are managed through established risk management processes. 5) Is the Trust satisfied that internal controls, including segregation of duties, exist and work effectively? Please provide details. If not, where are the risk areas? What other controls are in place to help prevent, deter or detect fraud? Response Key controls such as the segregation of duties, management review and supervision and authorisation and approval are evident in each of WDC’s core systems. It is acknowledged that maintaining an effective control environment is challenging in a time of reducing resources and a changing operating environment. For this reason, internal audit will have a continued role in supporting the Council in ensuring that an adequate but appropriate control environment is in place. In overall terms, Internal Audit have concluded that reasonable assurance can be provided on the Trust’s system of internal control for 2024/25. 6) Is the Trust satisfied that staff are encouraged to report their concerns about fraud, and the types of concerns they are expected to report? Please provide details. Response The Council promotes a zero tolerance toward fraud and promotes a culture that enables individuals to identify potential fraud and empowers them to report their concerns in a safe Page 116
Page 117
Appendix 2 and secure manner to the appropriate people at the right time. The means by which employees can report fraud are publicised on the Council’s intranet. Fraud issues are widely communicated both internally and externally to provides a deterrent to fraudsters by highlighting the Council’s commitment to identify fraud and take proactive action to pursue fraudsters. 7) From a fraud and corruption perspective, what are considered by the Trust to be high risk posts within the organisation? Please provide details. How are the risks relating to these posts identified, assessed and managed? Response Fraud and corruption, and associated risks, come in many forms and, consequently, it is not easy to specifically identify specific posts where there are greater risks than others. However there is a general recognition that there is an inherent risk of fraud within an organisation like a Council and partner organisations the risk of fraud is managed through existing controls and procedures which are in place across the organisation. The Trust takes assurance from the work of internal audit, the established fraud policies in place and ongoing embedding of a culture of fraud awareness through a programme of anti-fraud training and the work of the Council’s fraud team. This helps ensure that issues identified as a result of Internal Audit work or fraud investigations, result in recommendations to management to address gaps in control to ensure that risks are properly mitigated to acceptable levels. 8) Is the Trust aware of any related party relationships or transactions that could give rise to instances of fraud? Please provide details. How are the risks associated with fraud related to such relationships and transactions mitigated? Response We are not aware of any related party relationships or transactions that could give rise to instances of fraud. Disclosure of significant related party relationships is required for both members and officers in positions of influence. Page 117
Page 118
Appendix 2 9) Is the Trust aware of any entries made in the accounting records of the organisation that it believes or suspects are false or intentionally misleading? Please provide details. Are there particular balances where fraud is more likely to occur? Please provide details. Is the Trust aware of any assets, liabilities or transactions that it believes were improperly included or omitted from the accounts of the organisation? Please provide details. Could a false accounting entry escape detection? If so, how? Are there any external fraud risk factors which are high risk of fraud? Please provide details. Response We are not aware of any accounting entries which are suspected to be false or intentionally misleading. Should management become aware of any suspect accounting entries, these would be subject to immediate investigation through Internal Audit. We are not aware of any assets, liabilities or transactions that have been improperly included or omitted from the Trust’s accounts. Should any issues arise it is expected that these would be identified through review and approvals processes. Current and emerging risks are identified from a number of sources including the National Anti-Fraud Network (NAFN) and other law enforcement agencies. These are disseminated to relevant teams to raise awareness. 10) Is the Trust aware of any organisational, or management pressure to meet financial or operating targets? Please provide details. Is the Trust aware of any inappropriate organisational or management pressure being applied, or incentives offered, to you or colleagues to meet financial or operating targets? Please provide details. Response The Trustees are not aware of any inappropriate organisational or management pressure to meet financial or operating targets and there is no evidence of any incentive ever being offered to do so. International Standard for Auditing 250 – Consideration of laws and regulations in an audit of financial statements 11) How does the Trust gain assurance that all relevant laws and regulations have been complied with. For example: Is the Trust aware of the process management has in place for identifying and responding to changes in laws and regulations? Please provide details. What arrangements are in place for the Trust to oversee this process? Is the Trust aware of the arrangements management have in place, for communicating with employees, non-executive directors, partners and stakeholders regarding the relevant laws and regulations that need to be followed? Please provide details. Does the Trust have knowledge of actual or suspected instances where appropriate laws and regulations have not been complied with, and if so is it aware of what actions management is taking to address it? Please provide details. Response WDC is subject to a range of legal and regulatory frameworks. The Council has a Local Code of Good Governance and has appointed a Monitoring Officer (Chief Officer Regulatory and Regeneration) to ensure that the Council acts lawfully. All Trustee reports are subject to legal review and comment to ensure key issues are identified. The Council’s Chief Officer Regulatory and Regeneration is a member of the Senior Management Team and is sighted on any new strategic projects or initiatives with the Page 118
Page 119
Appendix 2 Council’s Legal Services having specialist officers who provide legal advice and support to particular service areas. As required, training is provided to officers on particular legal issues, some of it being mandatory, for example around data protection and equalities. Accepting that there will be minor operational instances of non-compliance, we are not aware of any instances of significant non-compliance during the financial year. This is supported by the annual review of the Local Code of Good Governance. International Standard for Auditing 501 – Specific consideration of the potential for, and actual, litigation and claims affecting the financial statements 12) Is the Trust aware of any actual or potential litigation or claims that would affect the financial statements? Please provide details. Response Given the size and the nature of the transactions of the Trust there are no known litigations or claims that would affect the financial statements. International Standard for Auditing 570 – Consideration of the going concern assumption in an audit of financial statements 13) How has the Trust assessed and satisfied itself that it is appropriate to adopt the going concern basis in preparing the financial statements? Response No issues in relation to going concern were highlighted to the Trustees. 14) Has the Trust identified any events or conditions since the assessment was undertaken which may cast significant doubt on the organisation’s ability to continue as a going concern? Please provide details. Response The Trustees are not aware of any events or concerns since the assessment was undertaken that would cast doubt on the Trusts ability to continue as a going concern. Page 119