Agenda Document Pack - Audit and Scrutiny Committee - 29/08/2024
North Ayrshire Council · 29 August 2024
Back to Audit and Scrutiny Committee — 29 August 2024 and its agenda
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Audit and Scrutiny Committee A Meeting of the Audit and Scrutiny Committee of North Ayrshire Council will be held in the Council Chambers, Ground Floor, Cunninghame House, Irvine, KA12 8EE on Thursday, 29 August 2024 at 10:00 to consider the undernoted business. Meeting Arrangements - Hybrid Meetings This meeting will be held on a predominantly physical basis but with provision, by prior notification, for remote attendance by Elected Members in accordance with the provisions of the Local Government (Scotland) Act 2003. Where possible, the meeting will be live-streamed and available to view at https://north-ayrshire.public- i.tv/core/portal/home. 1 Declarations of Interest Members are requested to give notice of any declarations of interest in respect of items of business on the Agenda. 2 Minutes The accuracy of the Minutes of the Meeting of the Audit and Scrutiny Committee held on 30 May 2024 will be confirmed and the Minutes signed in accordance with Paragraph 7 (1) of Schedule 7 of the Local Government (Scotland) Act 1973 (copy enclosed). 3 Internal Audit Reports Issued Submit report by the Head of Service (Finance) on the findings of Internal Audit work completed between May and July 2024 (copy enclosed). 4 Internal Audit and Corporate Fraud Action Plans: Quarter 1 Update Submit report by the Head of Service (Finance) on the progress made by Council Services in implementing the agreed actions from Internal Audit and Corporate Fraud reports as at 30 June 2024 (copy enclosed). 1
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE 5 Best Value Thematic Work in North Ayrshire Council 2023-24 Submit report by the Head of Service (Finance) requesting the Committee to note the Best Value Thematic Work reports for 2023/24 and to consider a verbal report by the external auditor (copy enclosed). 6 Climate Change Target & Associated Policies Submit report by the Executive Director (Place) on the Council’s progress of the Sustainable North Ayrshire Strategy (2024-27) (copy enclosed). 7 Standing Item of Business: Consideration of future business for scrutiny 8 Urgent Items Any other items which the Chair considers to be urgent. 9 Exclusion of the Public - Para 1 Resolve in terms of Section 50(A)4 of the Local Government (Scotland) Act 1973, to exclude from the Meeting the press and the public for the following item of business on the grounds indicated in terms of Paragraph 1 of Part 1 of Schedule 7A of the Act. Non Disclosure of Information In terms of Standing Order 21 (Disclosure of Information), the information contained within the following report is confidential information within the meaning of Section 50A of the 1973 Act and shall not be disclosed to any person by any Member or Officer. 10 Investigation Reports Issued Submit report by the Head of Service (Finance) informing of investigative reports finalised since the last meeting (copy enclosed). 2
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Webcasting Please note: this meeting may be filmed/recorded/live-streamed to the Council's internet site and available to view at https://north-ayrshire.public- i.tv/core/portal/home, where it will be capable of repeated viewing. At the start of the meeting, the Provost/Chair will confirm if all or part of the meeting is being filmed/recorded/live-streamed. You should be aware that the Council is a Data Controller under the Data Protection Act 2018. Data collected during the webcast will be retained in accordance with the Council’s published policy, including, but not limited to, for the purpose of keeping historical records and making those records available via the Council’s internet site. Generally, the press and public will not be filmed. However, by entering the Council Chambers and using the press or public seating area or (by invitation) participating remotely in this meeting, you are consenting to being filmed and consenting to the use and storage of those images and sound recordings and any information pertaining to you contained in them for webcasting or training purposes and for the purpose of keeping historical records and making those records available to the public. If you do not wish to participate in a recording, you should leave the meeting. This will constitute your revocation of consent. If you have any queries regarding this and, in particular, if you believe that use and/or storage of any particular information would cause, or be likely to cause, substantial damage or distress to any individual, please contact dataprotectionofficer@north-ayrshire.gov.uk 3
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Audit and Scrutiny Committee Sederunt John Bell (Chair) Donald Reid (Vice Chair) Eleanor Collier Cameron Inglis Tom Marshall Matthew McLean Davina McTiernan Donald L. Reid John Sweeney Chair: Apologies: Attending: 4
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Audit and Scrutiny Committee 30 May 2024 At a Meeting of the Audit and Scrutiny Committee of North Ayrshire Council at 10.00 a.m. involving participation by remote electronic means and physical attendance within the Council Chambers, Irvine. Present (Physical Participation) John Bell, Donald Reid, Cameron Inglis, Matthew McLean and Donald L. Reid. Present (Remote Participation) Davina McTiernan. In Attendance (Physical Participation) D. Hammond, Executive Director, R. Leith, Head of Service (Connected Communities), L. Cree, Senior Manager (Property Management and Investment) and A. Elliot, Senior Manager (Housing Operations) (Communities and Housing); T. Reaney, Head of Service (Neighbourhood Services) (Place); A. McClelland, Head of Service (Education); P. Doak, Head of Service (Finance and Transformation) (Health and Social Care Partnership); M. Boyd, Head of Service, D. Forbes Senior Manager (Strategic Business Partner) and L. Miller, Senior Manager (Audit, Fraud, Safety and Risk) (Finance); F. Walker, Head of Service, J. McNeil, Senior Manager (ICT) and E. Nixon, Senior Manager (Customer Services) (People and ICT); and A. Craig, Head of Service, I. Hardy, Team Manager (Policy & Performance), C. Stewart and H. Clancy, Committee Services Officers (Democratic Services) (Corporate Services). Also in Attendance (Physical Participation) D. Jamieson, Audit Scotland. Chair Councillor Bell in the Chair. Apologies Eleanor Collier, Tom Marshall and John Sweeney. 1. Declarations of Interest There were no declarations of interest by Members in terms of Standing Order 11 and Section 5 of the Code of Conduct for Councillors. 2. Minutes The Minutes of the Meeting of the Audit and Scrutiny Committee held on 21 March 2024 were confirmed and the Minutes signed in accordance with Paragraph 7 (1) of Schedule 7 of the Local Government (Scotland) Act 1973. 3. Construction Contract Quality Monitoring Submitted report by the Executive Director (Place) providing an update on the Council’s approach to Construction Contract delivery. Agenda Item 2 5
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Members asked questions and were provided with further information in relation to Contractor performance. Noted. 4. 2023/24 Elected Member Requests Report Submitted report by the Head of Service (Democratic) informing of the Council’s performance in handling Elected Member requests and the volumes and trends of Elected Member requests handled in Financial Year 2023/24. Members asked questions and were provided with further information in relation to the following:- • the EM Pro (Lagan) system particularly regarding logging requests, and some previous and historical issues surrounding reliability and downtime; and • training and development sessions that could be arranged to facilitate greater use of the system, while noting that a new system would be getting rolled out in October 2024, which would be supported by training and guidance on how to use it. Noted. 5. 2023/24 Complaint Report Submitted report by the Head of Service (Democratic) informing of the Council’s complaint handling performance and the volumes and trends of complaints received in Financial Year 2023/24. The report detailed the volume of complaints received and closed, complaints closed at each stage, complaint outcomes, the average time in working days for a full response at each stage, complaints closed within timescale, complaint timescale extensions, trends identified from upheld/partially upheld complaints and changes or improvements made as a result of complaints and compliments received. Members asked questions and were provided with further information in relation to:- • the nature of some of the complaints received including those relating to Education, and an explanation of the processes involved; • the process involved with missed bin collections, including frequency of collection, presentation rates and resource availability; and • the issue of replacement purple bin lids, which had an action plan in place, and the backlog of same which was being addressed. It was agreed that in respect of future reports, there would be a comparison table with the previous two financial years in respect of Complaint outcomes and that the relevant information would be circulated to Members for the financial years 21/22 and 22/23. Noted. 6
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6. Code of Corporate Governance Statement 2024/25 Submitted report by the Head of Service (Democratic) seeking approval of the Code of Governance Statement 2024/25. The Code of Corporate Governance Statement 2024/25 was attached at Appendix 1 to the report. Members asked questions and were provided with further information in relation to:- • training and development of Elected Members particularly in relation to the Local Development Plan (LDP) and Planning generally, which would be taken forward by officers to ensure that appropriate and regular update training was scheduled in the near future; and • training sessions held and attendance. The Committee agreed to (a) approve the Code of Corporate Governance Statement 2024/25, as detailed at Appendix 1 to the report; and (b) otherwise note the content of the report and associated Appendix. 7. Accounts Commission’s Report: Local Government in Scotland: Financial Bulletin 2022/23 Submitted report by the Head of Service (Finance) informing of the findings of the recently published report. Members asked questions and were provided with further information in relation to progress with the tourist and visitor levy and council tax multiplier proposals. The Committee agreed to (a) note the findings of the recent Accounts Commission report; and (b) note the current position of North Ayrshire Council in relation to the findings. 8. 2022/23 External Audit Action Plan Update Submitted report by the Head of Service (Finance) on the updated actions identified in the 2022/23 External Audit Action Plan. Appendix 1 to the report provided an update on the management actions taken to date including updated target dates for any outstanding items. The Committee agreed to note the updates to the agreed Action Plans as outlined in Appendix 1 to the report. 9. Annual Governance Statement 2023/24 Submitted report by the Head of Service (Finance) on the Council’s Annual Governance Statement for 2023/24 which will be included within the draft Annual Accounts. The draft Annual Governance Statement was attached at Appendix 1 to the report. A Member asked a question and received clarification on the scheduling of political engagement in relation to the budget process. 7
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The Committee agreed to approve the draft Annual Governance Statement as outlined in Appendix 1 to the report. 10. Accounting Policies 2023/24 Submitted report by the Head of Service (Finance) seeking approval of the accounting policies which will be adopted in the preparation of the Council’s Annual Accounts for the year to 31 March 2024. The accounting policies were attached at Appendix 1 to the report. Clarification was provided on the definition of a “soft loan” and Members noted that the Council has no loans granted on this basis. The Committee agreed to approve the accounting policies as outlined in Appendix 1 to the report. 11. Strategic Risk Register 2024/25 Submitted report by the Head of Service (Finance) on the Council’s agreed Strategic Risk Register for 2024/25. The Strategic Risk Register Report 2024/25, with detailed actions, was provided at Appendix 1 to the report. Members asked questions and were provided with further information in relation to the following:- • the Financial sustainability of the Council and the Health and Social Care Partnership (HSCP), including the impact of financial challenges faced by funding partners, and potential budget gaps in terms of funding; and • Business continuity and resilience, including cyber-security risk. Noted. 12. Internal Audit Annual Report 2023/24 Submitted report by the Head of Service (Finance) on the work of Internal Audit during 2023/24 and providing an opinion on the governance, risk management and internal control environment of the Council. The Annual Report 2023/24, together with a statement on internal controls, was detailed at Appendix 1 to the report. Members asked a question and were provided with assurance on the sufficiency of the staffing complement to deliver the work plan. The Committee agreed to note (a) the content of the annual report detailed at Appendix 1 to the report; and (b) the opinion of the Senior Manager on the Council’s governance, risk management and internal control environment. 8
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13. Corporate Fraud Team Annual Report 2023/24 Submitted report by the Head of Service (Finance) on the work of the Corporate Fraud Team during 2023/24, where 398 referrals for investigation had been received. The Senior Manager (Internal Audit, Risk and Fraud) highlighted investigations which had been carried out across a range of areas, including employee-related matters as well as Council Tax, Discretionary Housing Payments, Scottish Welfare Fund, Blue Badges and Housing tenancy issues. The Committee was advised of joint working arrangements with the DWP Single Fraud Investigation Service (SFIS) in cases where there were suspected frauds relating to both DWP Benefits and Council Tax Reduction. The Senior Manager also referred to the biennial National Fraud Initiate (NFI) work involving matching of relevant datasets across public bodies to identify possible fraud or error for further investigation. The exercise was now complete and details of the full results, as they relate to North Ayrshire, would be reported to a future meeting of the Audit and Scrutiny Committee. Noted. 14. Internal Audit and Corporate Fraud Action Plans: Quarter 4 update Submitted report by the Head of Service (Finance) on the progress made by Council Services in implementing the agreed actions from Internal Audit and Corporate Fraud reports as at 31 March 2024. Members asked questions and were provided with further information on progress with the action relating to CCTV in buildings. The Committee agreed to (a) note the current position with the implementation of Internal Audit and Corporate Fraud actions; and (b) challenge those Services that have not implemented actions within the previously agreed timescales. 15. Internal Audit Reports Issued Submitted report by the Head of Service (Finance) on the findings of Internal Audit work completed between March and April 2024. The findings from three audit assignments were detailed at Appendix 1 to the report, together with the respective executive summaries and action plans. Members asked questions and received further information on: • The number of procurement cards issued; and • cyber resilience and security and data protection impact assessments. The Committee agreed to note the outcomes from the Internal Audit work completed as set out in the report and detailed in Appendix 1 to the report. 9
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16. Standing Item of Business: Consideration of Future Business for Scrutiny Members were invited to consider potential items of scrutiny business for future meetings. Having heard the Head of Democratic Services, it was noted that reports on the Community Asset Transfer process and on the Council’s Climate Change target and associated policies would be reported to future meetings of the Committee, for Members’ consideration. 17. Urgent Items There were no urgent items. 18. Valedictory As this was the last meeting of the Committee which Laura Miller, Senior Manager (Audit, Fraud, Safety and Risk) would attend prior to moving to a new position, the Chair, on behalf of the Committee, wished Laura all the best for her new position and thanked her for all her work for North Ayrshire Council. The meeting ended at 11.35 a.m. 10
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NORTH AYRSHIRE COUNCIL 29 August 2024 Audit and Scrutiny Committee Title: Internal Audit Reports issued Purpose: To inform the Committee of the findings of Internal Audit work completed between May and July 2024. Recommendation: That the Committee considers the outcomes from the Internal Audit work completed. 1. Executive Summary 1.1 The Council's local Code of Corporate Governance requires effective arrangements to be put in place for the objective review of risk management and internal control. Internal Audit is an important element in this framework as it reviews internal controls and offers Elected Members and officers an objective and independent appraisal of how effectively resources are being managed. 1.2 The remit of the Audit and Scrutiny Committee includes the monitoring of Internal Audit activity. The submission and consideration of regular reports assists the Committee in fulfilling this remit. 2. Background 2.1 This report provides information on Internal Audit work completed between May and July 2024. Internal control reviews have been completed in respect of the areas detailed in Appendix 1 to this report. The aim of these reviews is to provide assurance that the internal control framework within the areas examined is appropriate and operating effectively. 2.2 The findings from each audit assignment have been notified in writing to the Chief Executive, the Section 95 Officer and the relevant Executive Director and Head of Service on the completion of each assignment. Where appropriate, this has included an action plan with recommendations for improving internal control. Appendix 1 includes the report and action plan from each audit. 2.3 The findings from 3 separate audit assignments are detailed at Appendix 1 to this report and the levels of assurance for each are noted in the table below: Agenda Item 3 11
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Audit Title Assurance Level Code of Corporate Governance Substantial Supply Teachers Substantial Payroll Transaction Testing Reasonable 3. Proposals 3.1 It is proposed that the Committee considers the outcomes from the Internal Audit work completed between May and July 2024. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The work of Internal Audit helps to support the efficient delivery of the strategic priorities within Our Council Plan 2023-2028. Community Wealth Building 4.7 None. 5. Consultation 5.1 The relevant Services are consulted on Internal Audit findings during each audit assignment. 12
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Mark Boyd Head of Service (Finance) For further information please contact Anne-Marie Fenton, Team Manager (Internal Audit), on 01294 324564. Background Papers None. 13
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CODE OF CORPORATE GOVERNANCE 1 Background 1.1 The Chartered Institute of Public Finance and Accountancy (CIPFA) and the Society of Local Authority Chief Executives and Senior Managers (SOLACE) published an updated version of their Delivering Good Governance in Local Government Framework in 2016 (“the Framework”). This identified 7 Principles of Good Governance and within each of these a series of sub-principles and behaviours and actions which demonstrate good governance in practice. To support implementation of the Framework, CIPFA and SOLACE also published a set of Guidance Notes for Scottish Authorities (“the Scottish Guidance”). 1.2 North Ayrshire Council’s Internal Audit team test compliance with selected principles of the Framework (and previous versions) on a cyclical basis and the last such audit took place in 2019/20. 2 Objectives and Scope 2.1 The audit gathered evidence to demonstrate compliance with 2 of the 7 Principles of Good Governance as outlined in the Framework. These were: • D: Determining the interventions necessary to optimise the achievement of the intended outcomes. • F: Managing risks and performance through robust internal control and strong public financial management. 3 Findings Principle D: Determining the interventions necessary to optimise the achievement of the intended outcomes 3.1 Members need accurate and timeous information to support their decision making. 3.2 Audit reviewed the Council’s approach to managing the provision of information to Members by considering:- • The Scheme of Administration • Controls around the content of committee papers • How the Council ensures productive communication between Members and Officers • How the Council obtains feedback from residents on strategic issues SCHEME OF ADMINISTRATION 3.3 The Council has a number of Committees. Clarity in terms of the roles, responsibilities and delegated decision making powers of each of these committees is provided via the Council’s Scheme of Administration. COMMITTEE PAPERS 14
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3.4 Member are asked to make decisions based on committee papers. The content and completeness of these reports is managed by:- • requiring all papers to follow a predefined template. The Council currently has 2 templates - a general template and a template tailored for planning reports. These templates contain standard headings to prompt the author to consider a number of areas that are important to the Council – both in terms of its aims and objectives, but also its legal obligations. Guidance is also available on the completion of these templates. • having a timetable that officers must follow when submitting reports. This timetable ensures that sufficient time is available for the Head of Service to approve the report, for Committee Services to prepare the agenda and report pack for Members, and for pre-agenda meetings to take place. Pre- agenda meetings allow for clarification and additional information to be requested of officers in advance of the committee meeting. COMMUNICATION BETWEEN MEMBERS AND OFFICERS 3.5 In order to support constructive debate between members and officers, whilst maintaining a strong working relationship, the Council has ‘Guidelines for Member/Officer Relations’. COMMUNICATION WITH RESIDENTS 3.6 The opinions of North Ayrshire residents are heard via Members. 3.7 The Council also engages with residents throughout the year on a number of issues such as:- • Council budget consultation • Progress against the Council Plan • HSCP programmes • Council Housing 3.8 The 2020 Best Value Assurance Report commented very positively on the Council’s citizen and community engagement, and the recent Best Value Thematic Work 2022-23 (dated October 2023) confirmed the Council’s ongoing performance in this area by stating ‘The council’s new priorities were developed from sustained engagement with its communities. The council demonstrates genuine commitment to working with and empowering local communities’. 3.9 All of the above measures ensure that the appropriate decision makers have accurate and timeous information. Principle F: Managing risks and performance through robust internal control and strong public financial management 3.10 Audit has reviewed the Council’s approach in the following areas:- • Managing Performance • Robust Internal Controls • Managing Data • Financial Management • Risk Management 15
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MANAGING PERFORMANCE 3.11 The Council Plan sets the strategic aims and objectives of the Council. The achievement of this Plan is monitored via the Council Plan Performance Framework. 3.12 This Framework consists of 26 PI’s and 46 actions and outcomes are formally reported to Cabinet, the Audit & Scrutiny Committee and published on the Council website 6 monthly. 3.13 These reports provide explanations for all PIs that are adrift of target. 3.14 The Council has in place a Performance Dashboard, which is in the process of being refreshed. This will be used to provide up to date performance information from the Framework to the public. 3.15 The Council also monitors its performance against its peers via the Local Government Benchmark Framework (LGBF). Annually the Council produces a report comparing its performance to other Scottish Councils within its ‘family group’ (i.e. councils that are similar in terms of the type of population that they serve (e.g. relative deprivation and affluence) and the type of area in which they serve them (e.g. urban, semi-rural, rural)). 3.16 This Framework covers 110 PIs, but North Ayrshire ensures its report is focussed and meaningful by only including the PIs that it deems most align with the Council Plan. This report is provided to Cabinet, the Audit & Scrutiny Committee and is published on the Council website. 3.17 Services have operational plans. These plans are for internal management and are not published or reported on. Each Head of Service is responsible for the composition, performance measures and monitoring of these plans. 3.18 In December 2023 the Executive Leadership Team (ELT) approved the development of a rolling programme of self-assessment. Operational Plans will form part of the self-assessment process. ROBUST INTERNAL CONTROLS 3.19 The Council’s Financial Regulations make the Chief Executive, Executive Directors and Heads of Service responsible for the maintenance of effective controls within the financial procedures operated by their Services. 3.20 The same Regulations give the Council’s Internal Audit Team the authority to carry out independent reviews on both financial, and other, controls in any area of the Council. 3.21 The Internal Audit Plan is based on a risk-based assessment of areas within the Council. Resources are then allocated to review the controls in areas assessed as higher risk. The Plan is dynamic to allow for ongoing review and to allow for any adjustments to reflect any emerging areas of risk. 16
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3.22 All findings are presented to the Audit & Scrutiny Committee and all recommendations arising from reviews are recorded and monitored on Pentana (the Council’s performance management system). Services must justify any actions not completed within agreed timescales. 3.23 Any allegations of fraud or error are investigated by the Council’s Corporate Fraud team, with findings being reported to Audit & Scrutiny Committee. MANAGING DATA 3.24 The Council has a dedicated Data Protection Officer who is tasked with ensuring the Council has a robust data governance framework. 3.25 The Council has a ‘Data Protection Policy’ which covers:- • Data Protection Principles • Notification of Processing Activities • Roles & Responsibilities • Information Sharing • Data Protection Impact Assessment • Management of Data Incidents and Breaches. 3.26 In support of the above policy, the Council also has a range of policies, procedures and guidelines that promote compliance and best practice. These include:- • Acceptable Use Policy • Data Breach Reporting and Management Procedures • Records Management • Data Protection Impact Assessment Framework • Freedom of Information • Information Asset Register • Subject Access Requests • Privacy Notice • Redaction Guidelines • ICT and Cyber Security policy 3.27 Each year all staff must undertake refresher Cyber Security and GDPR training (online via iLearn). DATA SHARING 3.28 The Council’s ‘Data Protection Policy’ states that a data processing and sharing agreement must be in place when sharing personal data with a 3rd party. 3.29 The Council has an Information Governance Procurement Framework (IGPF) to help officers identify any data governance issues that need to be addressed during the procurement process. 3.30 It also prompts officers to complete a Data Protection Impact Assessment (DPIA) if sharing of personal data is identified. This Assessment is designed to support the Officer with identifying and addressing any potential privacy impacts. 17
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3.31 The council has an Information Asset Register to record and monitor all information assets throughout the Council. The purpose of the Register is to help officers understand the risks associated to the information held and demonstrate measures taken to protect it throughout its life cycle. The register is reviewed annually. FINANCIAL MANAGEMENT 3.32 An audit of the Council’s Financial Resilience and Viability was carried during 2023/24 during which substantial assurance was obtained with regard the Council’s application of the principles of the CIPFA FM Code. 3.33 CIPFA states that compliance with the FM Code assists local authorities in demonstrating that they are meeting their legislative requirement to have sound financial management. 3.34 Reliance has been placed on this outcome, and no further testing has been undertaken as part of this audit. RISK MANAGEMENT 3.35 The Council has a risk management strategy setting out the Council’s overall approach to risk management. 3.36 It also has a risk management governance guide which sets out the roles and responsibilities of key officers and boards/groups within the Council in terms of risk management. 3.37 Both of these documents are in the process of being refreshed. 3.38 The Council can demonstrate its identification and monitoring of risks via its series of risk registers. The Council uses different risk registers depending on the scope and severity of the risk. The Council’s registers are as follows:- • Strategic risk register – This records top level risks potentially impacting on the objectives of Council, often driven by external factors over which the Council may have limited or no control over. The Corporate Risk Management Group (CRMG) monitors the progress of the action plans relating to this plan 6 monthly and Cabinet approves the annual register update. • Corporate risk register – This records operational riskswhich impact across the organisation, affecting several or all Service areas. CRMG and ELT update this register annually. • Service/Operational risk register – This records operational risks which will be specific to and managed by one Council Service. Services are responsible for updating their registers and escalating any risks to the ELT that they assess to be corporate in nature. • Project risk registers – for risks that relate to specific projects. These are updated as appropriate for the specific needs of the Project. 3.39 The above confirms the Council has robust internal controls in place to mitigate risk and manage performance. 18
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4 Internal Audit Opinion 4.1 Overall, substantial assurance was obtained with regard the Council’s compliance with Principles D and F of the Delivering Good Governance in Local Government Framework. Definitions of Assurance Levels: Substantial A sound system of governance, risk management and control exist, with internal controls operating effectively and being consistently applied to support the achievement of objectives in the area audited. Reasonable There is a generally sound system of governance, risk management and control in place. Some issues, non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. Limited Significant gaps, weaknesses or non-compliance were identified. Improvement is required to the system of governance, risk management and control to effectively manage risks to the achievement of objectives in the area audited. None Immediate action is required to address fundamental gaps, weaknesses or non-compliance identified. The system of governance, risk management and control is inadequate to effectively manage risks to the achievement of objectives in the area audited. NB The level of assurance given is at the discretion of Internal Audit. 19
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SUPPLY TEACHERS 1 Background 1.1 All teachers are required to be registered by the General Teaching Council for Scotland (GTCS). 1.2 Supply teachers are employed directly by the Council and paid according to nationally agreed conditions of services contained in the Scottish Negotiating Committee for Teachers (SNCT). Supply teachers cover short-term and long-term absences. 1.3 SEEMiS had provided a national supply booking system as part of the management information system but this was withdrawn by them in 2021. As a result all 32 Councils in Scotland’s Education services had to find an alternative recording system. NAC opted for Shiftplan, a cloud-based booking system in conjunction with Cloud Cover IT in partnership with Riverside TMA, a local North Ayrshire company. No other authority has chosen this supplier; however, two other authorities have made enquiries with a view to adopting the system. 1.4 The Scottish Government complete an annual survey of teacher numbers every September, this provides an annual snapshot. Since 2006, NAC have employed on average 1,383 teachers per year, in 2022 the population was 1,422, a reduction of 40 from the previous year. The overall teacher numbers since 2006 have reduced by 15. 2 Objectives and Scope 2.1 The main objectives of the audit were to ensure: • sufficient checks are undertaken prior to adding staff to the supply bank register • supply staff are booked in accordance with procedures • supply staff are paid accurately • GTCS records are checked and registration maintained 3 Findings Supply Staff Bank 3.1 The average cost for this system is £32,364 per annum. Core prices have remained static over the 3 years tested. 3.2 Supply teacher recruitment is completed through myjobscotland on an annual basis. Head Teachers support recruitment of staff using the TalentLink back office system which sits behind the myjobscotland website. Standard recruitment checks are completed at this point and HR resourcing complete the process. A letter of employment is issued to the successful teachers. 3.3 Once selected, supply teachers are given access to the Shiftplan system where vacant posts are advertised. There are currently 719 user licences, 131 operators licences and 18 administrator licences. Booking Supply staff 3.4 Comprehensive procedure documents are in place for administration and system operators. Supply teachers also have instructions to set up notifications on their mobile devices. 20
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3.5 Teachers on the supply list are required to register their weekly availability. Available supply slots are posted on Shiftplan. These posts can be targeted individually or made available to everyone on the supply register. Once posted the post becomes available to the first person to accept. If no availability is posted within one year, teachers are removed from the list. 3.6 In 2022-23 school year 298 supply teachers were requested to cover the equivalent of 85092.55 hours. Payment of Supply Teachers 3.7 A report is extracted directly from Shiftplan to HR and payment is made. A review of HR Payroll late payment and Off reports did not identify any issues with this process. 3.8 Sample testing matched CHRIS payments to Shiftplan supply teacher register hours worked for school periods 2022/23 and August 2023 to December 2023. No issues were identified. GTCS Records 3.9 All teachers had a GTCS registration number recorded on CHRIS, a sample of 10 was successfully matched to the GTCS website. 4 Internal Audit Opinion 4.1 Overall, substantial assurance was obtained with regard to the recruitment of supply teachers. 21
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Definitions of Assurance Levels: Substantial A sound system of governance, risk management and control exist, with internal controls operating effectively and being consistently applied to support the achievement of objectives in the area audited. Reasonable There is a generally sound system of governance, risk management and control in place. Some issues, non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. Limited Significant gaps, weaknesses or non-compliance were identified. Improvement is required to the system of governance, risk management and control to effectively manage risks to the achievement of objectives in the area audited. None Immediate action is required to address fundamental gaps, weaknesses or non-compliance identified. The system of governance, risk management and control is inadequate to effectively manage risks to the achievement of objectives in the area audited. NB The level of assurance given is at the discretion of Internal Audit. 22
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PAYROLL TRANSACTION TESTING 1 Background 1.1 This audit was conducted as part of the approved 2023/24 Internal Audit Plan and used computer audit software to interrogate the HR Payroll system and examined any anomalies which arose. 1.2 Audit software called IDEA (Interactive Data Extraction and Analysis) has been used to carry out this testing. In addition, Internal Audit are working with the Data Analytics Team to utilise Power BI for future audits. 1.3 The Employee Account is used to access and complete internal online forms for contract amendments and terminations. 1.4 The audit covered the following areas: • Overtime • Working time regulations • Last payment for leavers • Salary amendment • Pay Adjustments 2 Objectives and Scope 2.1 The main objectives of this audit were to ensure that: • High overtime payments are valid and properly authorised and no duplicate overtime payments have been made. • Employees working an average of 48+ hours per week have complied with the working time directive regulations. • Employees last pay is correct, properly authorised and any overpayments have been identified and rectified. • Salary amendments are valid and authorised. • No duplicate pay adjustments have been made. 2.2 The audit covered the period 1st October 2022 to 30th September 2023. 3 Findings Overtime Checks 3.1 The auditor selected a sample of 10 high overtime payments to test. A HSCP employee was found to have been overpaid 2 hours overtime plain due to an addition error on the overtime sheet resulting in an overpayment of £41.14 and this has been rectified by the Service. In addition, 4 of the overtime forms did not record the reason for the overtime. 3.2 The auditor tested for potential duplicate overtime payments by testing the same overtime hours to the same employee for the same overtime date but paid in a different payruns. There were 20 potential duplicate overtime payments found and a sample of 10 were selected to check. This resulted in the identification of 3 duplicate overtime payments which are detailed below. 3.3 A Facilities Management employee has been overpaid £422.38 for 30.5 overtime hours keyed twice for period ending 10/01/23. However, this employee was also underpaid £78.40 for the same overtime date due to the incorrect weekly contracted hours recorded on the overtime 23
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spreadsheet. This has been passed to Facilities Management to contact Payroll to ensure the overpayment is recovered and the underpayment is corrected. 3.4 A HSCP employee has been overpaid £592.02 for 17 overtime hours keyed twice for period ending 28/02/23. The Service has agreed to recover this money. 3.5 A HSCP employee has been overpaid £88.68 for 4 hours overtime keyed twice for period ending. The Service has agreed to recover this money. Working Time Regulations 3.6 The auditor tested for employees that work a weekly average hours of more than 48 hours for the period 01/01/23 to 30/06/23. This calculation adds contracted hours and overtime hours. There were 38 employees meeting this criteria and 23 of them have a record on the payroll system to show they have selected to opt out of the Working Time Regulations. As a result, 15 employees have no record on the Payroll system of selecting to opt out of the Working Time Regulations. This information has been passed to the relevant senior managers to action. 3.7 The auditor tested for current employees with more than 1 primary contract. This identified 1 employee who has a 37 hours per week contract and a casual contract but no multi-post contract. This was passed to Resourcing who confirmed with the service that the employees’ casual contract should be terminated and this will be actioned by Payroll. Leavers Last Pay 3.8 The auditor selected a sample of 10 leavers that have been paid since they left. This testing resulted in the following findings: • late submission of 3 termination forms. • a termination form stated a leaver was entitled to 12 weeks pay in lieu of notice and although the correct amount was paid, it was wrongly coded to pay in lieu of holidays. 3.9 The auditor carried out additional testing to identify overpayments to leavers which have not been identified and rectified by the Payroll team. This test resulted in 10 potential overpayments that were passed to the Payroll Team to investigate as they were not recorded on the Payroll Overpayments Log and there was no evidence the overpayment had been rectified on the Payroll system. This resulted in a missed gross overpayment of £291.83 and Payroll advised an account will be raised. 3.10 The auditor tested for employees that left and restarted to check there was no overlap in dates. This identified 3 employees having more than one employee number for a period of less than 1 week. The Team Supervisor (Payroll) advised they have been set up as a new start by the Resourcing team at the request of the service and Resourcing should have checked to see if the employee was already on CHRIS and if so, they should have advised the service to create a new additional contract. Each employee found in this test now only has 1 employee number and no additional contracts. 3.11 There were 10 employees that that left within 21 days of starting. There were no findings to note from this testing. Salary Amendments 3.12 The auditor selected a sample of 10 salary amendments to carry out checks to ensure they were properly authorised and recorded properly on the Payroll system. The only finding to note was that 3 out of the 10 amendment forms were submitted late. Pay Adjustments 24
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3.13 The auditor tested for duplicate pay adjustments code to 0056 (Pay Adjustments – Sup). There were 6 duplicate payments paid to the same employee for the same amount on the same pay date. All were checked and there were no findings to report. 4 Internal Audit Opinion 4.1 Overall, reasonable assurance was obtained with regarding to the testing carried out on the HR Payroll system. Definitions of Assurance Levels: Substantial A sound system of governance, risk management and control exist, with internal controls operating effectively and being consistently applied to support the achievement of objectives in the area audited. Reasonable There is a generally sound system of governance, risk management and control in place. Some issues, non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. Limited Significant gaps, weaknesses or non-compliance were identified. Improvement is required to the system of governance, risk management and control to effectively manage risks to the achievement of objectives in the area audited. None Immediate action is required to address fundamental gaps, weaknesses or non-compliance identified. The system of governance, risk management and control is inadequate to effectively manage risks to the achievement of objectives in the area audited. NB The level of assurance given is at the discretion of Internal Audit. 25
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1 NORTH AYRSHIRE COUNCIL 29 August 2024 Audit and Scrutiny Committee Title: Internal Audit and Corporate Fraud Action Plans: Quarter 1 update Purpose: To advise the Audit and Scrutiny Committee on the progress made by Council Services in implementing the agreed actions from Internal Audit and Corporate Fraud reports as at 30 June 2024. Recommendation: That the Committee (a) notes the current position with the implementation of Internal Audit and Corporate Fraud actions; and (b) challenges those Services that have not implemented actions within the previously agreed timescales. 1. Executive Summary 1.1 The CIPFA document 'Audit Committee Principles in Local Authorities in Scotland' highlights that Audit Committees should monitor and review the progress made in implementing audit recommendations. 1.2 Service managers are responsible for ensuring that agreed actions arising from Internal Audit and Corporate Fraud reviews are implemented. This provides assurance that identified control weaknesses have been addressed and are being managed effectively. 1.3 All actions are monitored on the Pentana system and service managers are responsible for updating Pentana as they progress each action. This enables Internal Audit to monitor progress on a 'real-time' basis and address any delays in implementation. 1.4 This report details the position as at 30 June 2024. 2. Background 2.1 The last report to the Audit and Scrutiny Committee on 30 May 2024 highlighted that there were six actions outstanding at 31 March 2024: one that had not been started or was only partially implemented, and five where the due date had not yet passed. 2.2 In addition to these six carried forward actions, there have been 17 new actions agreed, giving a total of 23 action points for review. Agenda Item 4 27
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2 2.3 Services have completed 15 actions since the last report. All Council Services are required to retain evidence of work carried out in completing their actions and Internal Audit carries out 'spot-checks' on a sample of completed actions on an ongoing basis. 2.4 Of the remaining 8 actions, none were partially complete at 30 June 2024 and all of the remaining 8 actions were not due for completion until after that date. 3. Proposals 3.1 It is proposed that the Committee notes the current position with the implementation of Internal Audit and Corporate Fraud actions. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The effective implementation of agreed Internal Audit and Corporate Fraud actions helps to support the efficient delivery of the strategic priorities within Our Council Plan 2023-2028. Community Wealth Building 4.7 None. 5. Consultation 5.1 Council Services are consulted during the completion of each Internal Audit and Corporate Fraud review and have also provided updates on progress made in implementing action points. 28
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3 Mark Boyd Head of Service (Finance) For further information please contact Anne-Marie Fenton, Team Manager (Internal Audit), on 01294 324564. Background Papers None. 29
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NORTH AYRSHIRE COUNCIL 29 August 2024 Audit and Scrutiny Committee Title: Best Value Thematic Work in North Ayrshire Council 2023- 24 Purpose: To invite Committee to note the Best Value Thematic Work reports for 2023/24 and to consider a verbal report by the external auditor. Recommendation: That Committee: (a) Notes the findings of the external auditor’s Best Value Thematic Work report; (b) Considers the verbal report by the external auditor; and (c) Notes the Improvement Action Plan outlined in Appendix 1 to the Report. 1. Executive Summary 1.1 As part of the external audit for 2023/24, Audit Scotland have produced the attached Best Value Thematic Work report to provide the Audit and Scrutiny Committee with the external auditor’s findings in relation to workforce innovation and how the Council is responding to workforce challenges. 1.2 The report examines the Council’s response to workforce challenges, identifies key messages and makes a number of recommendations for improvements. 1.3 Audit Scotland’s report includes an action plan in relation to the recommendations for improvement identified during the course of the audit. Full details of this and the management responses are included in Appendix 1 of Report. 2. Background 2.1 Audit Scotland have been designated as the Council’s external auditors for the five- year period 2022/23 to 2026/27. 2023/24 is the second year of this five-year cycle. 2.2 The Best Value Thematic Work in North Ayrshire Council 2023-24 report sets out how the Council is responding to current workforce challenges through building capacity, increasing productivity and innovation, considering: • How effectively are the Council’s workforce plans integrated with its strategic plans and priorities? Agenda Item 5 31
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• How effectively has digital technology been used to support workforce productivity and improve service quality and outcomes? • How effectively is the Council using hybrid and remote working and other innovative working practice such as a four-day week to achieve service and staff benefits? • What innovative practice is the Council using to develop its future workforce capacity and skills needs and manage staff reductions in line with its priorities? • What progress has the Council made with sharing roles or functions across its services and/or with other councils and partners? • How effectively is the Council measuring the impact of its workforce planning approach? 2.3 A summary of the key messages identified within the report include: • Staff costs equate to around 49 per cent of the Council’s overall revenue budget; • The Council has set out a clear vision for workforce planning in its Council Plan 2023-28; • There are positive relationships between the Trades Unions and the Council; • Comprehensive approach to Workforce planning at a service level with detailed action plans, with some strengthening required at corporate level; • Real time workforce data is utilised to inform future planning. • Well established Livewell programme in place to support workforce wellbeing. • Well established Modern Apprentice programme providing skills development opportunities. • The Council’s Voluntary Early Release Programme, completed in 2023/24, is projected to save £2.4 million in recurring savings from the reduction of 85 staff; • The Council consulted extensively with both its workforce and citizens when developing its Digital North Ayrshire Strategy 2023-28; • The Council is using digital technology to increase workforce productivity and improve services, mainly through the automation of processes but there is scope for more to be quantified; • Agile working has been promoted by the Council for a decade and was strengthened in 2021; • The Council has adopted a wide range of approaches to improve the skills and capacity of its existing and future workforce; • There is scope for the Council to explore further where it can work together with partners to share services and increase collaboration; and • The Council could improve how it monitors the effectiveness of its workforce planning practice by regularly reporting progress against workforce planning priorities. 2.4 The recommended actions arising from the audit and the relevant management responses have been detailed in Appendix 1 to each of the reports, including: • The Council should establish corporate workforce planning priorities and develop a SMART action plan to allow progress in delivering these priorities to be measured.; • The Council’s workforce strategy should be updated to align with all four Council Plan 2023-28 priorities and with other key strategies and plans.; • The Council should build on the work it has done to date to demonstrate and quantify what workforce benefits and productivity gains have been made through its use of digital technology; 32
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• The Council should consider conducting another digital skills survey to inform the support it provides for improving the digital skills and knowledge of its workforce.; • The Council should consider gathering further feedback from staff on the impact of agile working on wellbeing and productivity; • The Council should explore further where it can work together with partners to share services and increase collaboration; • The Council should regularly report its progress against its workforce planning priorities to elected members through its Council Plan updates or other means; and • The Council should develop a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. 2.5 Representatives from Audit Scotland will be in attendance at Committee and will present a verbal report highlighting the main findings of the report. 3. Proposals 3.1 It is proposed that Committee: (a) Notes the findings of the external auditor’s Best Value Thematic Work report; (b) Considers the verbal report by the external auditor; and (c) Notes the Improvement Action Plan outlined in Appendix 1 to the Report. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 The report includes a number of recommendations on how the Council is responding to workforce challenges. Legal 4.3 None. Equality/Socio-economic 4.4 None. Environmental and Sustainability 4.5 None. Key Priorities 4.6 This report directly supports the Council Plan 2023 to 2028 by maximising financial flexibility to support the delivery of our priorities. 33
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Community Wealth Building 4.7 None. 5. Consultation 5.1 Audit Scotland has consulted with Chief Officers from across the Council in preparing their report. Mark Boyd Head of Service (Finance) For further information please contact David Forbes, Senior Manager (Strategic Business Partner), on 01294 324551. Background Papers None 34
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Prepared by Audit Scotland July 2024 Workforce Innovation - how councils are responding to workforce challenges Best Value thematic work in North Ayrshire Council 2023-24 35
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Best Value thematic work in North Ayrshire Council 2023-24 | 2 Contents Key messages 4 Scope of the audit 6 Workforce strategy and priorities 8 Digital technology and the workforce 12 Flexible working and other innovative staff deployment 15 Developing future skills and capacity 19 Joint workforce arrangements across services and partners 22 Measuring the impact of workforce planning 24 Appendix 1 27 36
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Key messages | 3 Key facts Workforce 7,604 Number of people working for the council – headcount as at 30 April 2024 6,484 Number of people working for the council – full time equivalent as at 30 April 2024 1,302* Number of casual staff 646 Number of temporary staff 11.9% Turnover of staff in last year 12.8 Days lost per FTE during 2023/24 due to absence Age profile 4.1% 16 to 24 18.5% 25 to 34 35.8% 35 to 49 41.6% 50 and over Sources: North Ayrshire Council – Power BI extract – 30/4/24. Casual report extracted from Payroll System on 6/06/24. Number of temporary staff was live data provided by North Ayrshire Council on 12/6/24 * 399 casual workers have other employment with the council and 903 are employed as casual only. 37
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Key messages | 4 Key messages 1 North Ayrshire Council employs just over 7,600 members of staff, almost 42 per cent of whom are aged 50 or over. Staff costs equate to around 49 per cent of the council’s overall revenue budget. 2 The council has set out a clear vision for workforce planning in its Council Plan 2023-28. It takes a structured and comprehensive approach to workforce planning at service level but its corporate-level approach requires strengthening. 3 There are positive relationships between the Trades Unions and the council. Trades Unions feel they are consulted with appropriately and their views are considered. 4 The council’s Voluntary Early Release Programme, completed in 2023/24, is projected to save £2.4 million in recurring savings from the reduction of 85 staff. An assessment of the impact on service delivery was considered before the release of staff was approved. The Medium-term Financial Plan projects that its workforce will reduce by 79.5 Full Time Equivalent posts (FTEs) through natural attrition, vacancy management, redeployment and voluntary early release. 5 The council is using digital technology to increase workforce productivity and improve services, mainly through the automation of processes. It has established the workforce benefits and productivity gains of its digital technology improvements but there is scope for more of these to be quantified. It is considering how to further enhance the digital skills and knowledge of its workforce. 6 Agile working has been promoted by the council for a decade and was strengthened in 2021. The council has gathered feedback on wellbeing and productivity in relation to agile working and recognises that further engagement with its workforce would be beneficial. 7 The council has adopted a wide range of approaches to improve the skills and capacity of its existing and future workforce. It has a well-established modern apprenticeship programme, demonstrating positive outcomes. 8 There is scope for the council to explore further where it can work together with partners to share services and increase collaboration. The council shares its Corporate Fraud Team with East Ayrshire Council and resources 38
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Key messages | 5 are allocated to support the demands from both councils. Joint arrangements are also in place in relation to a Pan-Ayrshire Occupational Health contract with East and South Ayrshire. 9 The council could improve how it monitors the effectiveness of its workforce planning practice by regularly reporting progress against workforce planning priorities. The council has a rich source of available data in relation its workforce and would benefit from developing a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. This could help to inform future workforce planning. 39
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Scope of the audit | 6 Scope of the audit 1. The 2023 Local Government Overview (LGO) notes that councils have never faced such a challenging situation. Service demands have increased after the Covid-19 pandemic and funding is forecast to reduce in real terms. Workforce pressures including recruitment in a competitive labour market, employee retention and high sickness absence levels are putting councils under continued pressure. 2. This report sets out how the council is responding to current workforce challenges through building capacity, increasing productivity and innovation. 3. The Accounts Commission’s Strategy (2021-26) sets out its priorities to focus on inequalities, funding, communities and recovery. The Code of Audit practice sets out the Best Value work required to report on these priorities. Code of Audit Practice 2020 Best Value reporting requirements Best Value reporting – extract from the Code The Accounts Commission’s approach to Best Value involves reporting on individual local government bodies and thematically across the local government sector through performance reports: • As part of their integrated wider-scope annual audit work appointed auditors use a risk- based approach to assess and report whether the audited body has made proper arrangements for securing Best Value and is complying with its community planning duties, including reporting progress against previous Best Value findings and recommendations. • The Accounts Commission also requires the Controller of Audit to report to the Accounts Commission on each council at least once over the five-year audit appointment on the body’s performance on its Best Value duty. This enables the Accounts Commission to make findings for improvement where appropriate. • The Accounts Commission reports nationally on thematic aspects of local government bodies’ approaches to, and performance in, meeting their Best Value and community planning duties. Local government appointed auditors report locally on any such Best Value thematic work prescribed by the Accounts Commission. 4. This report covers the thematic aspect of the Best Value audit requirements. The Commission has directed auditors to report on workforce innovation and how councils are responding to workforce challenges. In carrying out the work auditors have considered the following questions: 40
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Scope of the audit | 7 • How effectively are the council’s workforce plans integrated with its strategic plans and priorities? • How effectively has digital technology been used to support workforce productivity and improve service quality and outcomes? • How effectively is the council using hybrid and remote working and other innovative working practice such as a four-day week to achieve service and staff benefits? • What innovative practice is the council using to develop its future workforce capacity and skills needs and manage staff reductions in line with its priorities? • What progress has the council made with sharing roles or functions across its services and/or with other councils and partners? • How effectively is the council measuring the impact of its workforce planning approach? 5. An improvement action plan is included at Appendix 1 of this report. This sets out audit recommendations in key areas, and the council’s planned response including responsible officers and dates for implementation. 6. The coverage of the work is in line with the expectations for council’s arrangements for the seven Best Value themes in the Local Government in Scotland Act 2003, Best Value Statutory Guidance 2020. 41
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Workforce strategy and priorities | 8 Workforce strategy and priorities The council has set out a clear vision for workforce planning in its Council Plan 2023-28. It takes a structured and comprehensive approach to workforce planning at service level but its corporate-level approach could be strengthened. 7. North Ayrshire Council employs just over 7,600 members of staff, almost 42 per cent of whom are aged 50 or over. Staff costs equate to around 49 per cent of the council’s overall revenue budget. 8. Workforce planning involves identifying and addressing future capacity and skills gaps, at operational and leadership levels. It requires strategic thinking, comprehensive workforce data and ongoing consultation and engagement with staff and trades unions. 9. A council focused on achieving Best Value will have a workforce strategy that sets out expectations on how the local authority’s staff will deliver its vision, priorities and values. 10. To be effective, workforce planning must be integrated across the organisation. Workforce strategies need to support the council in achieving its strategic priorities. They must support other key plans including financial, asset, digital and transformation planning. They need to be under-pinned with detailed workforce plans within services. 11. In 2022/23 we reported in our Best Value thematic work that clear alignment (of workforce plans) will continue to be needed with the council's Sustainable Change Programme in order to ensure they adhere to the council’s priorities over the medium and longer-term and maintain a synergy between workforce, service, financial and digital plans. The council sets out a clear vision for workforce planning in its Council Plan 2023-28 12. The council has four strategic aims, one of which is to be a sustainable council - A Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities. One of the activities the council has placed under this strategic aim is: Effective workforce planning ensuring that we have the right skills/resources to deliver priorities. It is working towards the outcome: The shape of our workforce is planned and resourced to deliver our priorities, ensuring our employees are supported to develop, perform and thrive. 42
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Workforce strategy and priorities | 9 Clear linkages between effective workforce planning and addressing the council’s funding gap are made in the council’s financial plans 13. The council discusses the importance of workforce planning in helping it address its budget gap in its financial outlook papers approved in December 2023 and in its revenue budget papers from February 2024. The council notes that its estimated funding gap for the next three years is £48 million and as employee costs represent 49 per cent of the council's gross expenditure budget, if future savings proposals impact on staff proportionately to their share of the budget, then there would be a significant impact on staffing levels. The council concludes that a more integrated, whole systems approach to workforce planning is required. 14. The council’s current plans to address this include the Voluntary Early Release (VER) programme that ran in 2023/24 (paragraphs 42-45) supported by further service re-design across the council as part of wider strategies supporting transformation. The council’s Workforce Strategy 2023-28 requires strengthening to provide clear links between its vision for its workforce and workforce planning at service level. 15. The council set out its approach to workforce planning in 2018 and this was agreed by its Executive Leadership Team. This approach was centred on workforce planning at service level being reviewed every six months. Due to the launch of the council’s VER programme in 2023/24 (paragraphs 42- 45), the council decided to build on this approach to produce the Workforce Strategy 2023-28 in August 2023. However, the strategy requires strengthening as it still reads more like an approach than a strategy. The Workforce Strategy 2023-28 sets out the council’s approach to workforce planning but does not articulate what its strategic workforce priorities are or include a corporate-level action plan. 16. The Workforce Strategy 2023-28 sets out the links between workforce and financial planning, describes the use of PESTLE (political, economic, sociological, technological, legal and environmental analysis) as a self- assessment tool and provides a link to live workforce data. The council does not set out what the council’s strategic workforce planning priorities are and does not include a corporate-level action plan for actions that may be applicable across all services, eg reducing the use of casual staff or recruitment times. The strategy was considered by the council’s Staffing and Recruitment Committee. Recommendation 1 The council should establish corporate workforce planning priorities and develop a SMART action plan to allow progress in delivering these priorities to be measured. 43
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Workforce strategy and priorities | 10 The Workforce Strategy 2023-28 is not aligned to the council’s other key strategies and plans and does not include an analysis of council-level workforce data. 17. The Workforce Strategy 2023-28 states in its introduction that it ‘sets out how our workforce will support the delivery of the council’s ambitions within the available financial resources’. A section in the Workforce Strategy 2023- 28 sets out three of the council’s four strategic aims and another section sets out its strategic future workforce approach. The strategic aim that includes references to workforce planning and its desired outcome – A sustainable council – is not mentioned in the Workforce Strategy 2023-28. 18. In addition, although the council has developed comprehensive, real-time workforce data that is discussed with services every six months – and an internal link is provided to this in the Workforce Strategy 2023-28 - this is not analysed or referred to at council level at a point in time in the strategy. For example, there is no analysis of the age profile of the council’s workforce or the number of casual staff used included in the strategy that then underpins corporate priorities. Indicators of staff wellbeing or indicators related to skills and learning needs are also not included or discussed. Recommendation 2 The council’s workforce strategy should be updated to align with all four Council Plan 2023-28 priorities and with other key strategies and plans. It should include an analysis of council-wide workforce data and set out what the required skills, learning and development needs of its staff are. The council has a structured and comprehensive approach to service-level workforce planning. 19. Since 2018, the council has adopted a structured and comprehensive approach to workforce planning at service level. Every six months meetings take place between HR and Heads of Service across all 14 services to discuss and update service workforce plans. 20. All the service workforce plans use a standard template and include: • a PESTLE analysis that considers the political, economic, social, technological, legal and environmental factors facing the service • people implications analysis. This requires the service to consider succession planning, its talent pipeline, the composition of its workforce, demographics and areas of growth or disinvestment. It also draws out actions supporting transformation. • a change planner that records the creation, deletion or regrading of posts, associated savings or additional costs and the anticipated impact of the changes 44
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Workforce strategy and priorities | 11 • an action plan split by short, medium and long-term timescales. This sets out the action owner, details any support required and the timescale. Real-time service-level workforce data is provided to services to assist with workforce planning. 21. At the six-monthly workforce planning meetings between HR and Heads of Service, detailed, service-specific real-time workforce data, presented using Power BI, is also discussed. The council has developed a wide-ranging suite of user-friendly data, using infographics, in conjunction with Heads of Service. HR have full access to the full dataset in Power BI while chief officers and senior managers have access to data related to their own areas. The council plans to develop a managers’ toolkit which will initially focus on hosting workforce data in a more user-friendly way and aims to commence this development work later in 2024. The workforce data generated is extensive and includes: • headcount and FTE • breakdown of contract type • percentage of employees by age • length of service by grade • analysis of leavers: turnover percentage, reason for leaving, gender split, type of contract, age • analysis of new starts: age of new start, type of contract, male or female • number of employees who live in each SIMD classification (1-10) and average salary in each classification • employee location • grade progression (number of employees who have progressed to a higher grade). 45
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Digital technology and the workforce | 12 Digital technology and the workforce The council is using digital technology to increase workforce productivity and improve services, mainly through the automation of processes. It has established the workforce benefits and productivity gains of its digital technology improvements but there is scope for more of these to be quantified. The council is considering how to further enhance the digital skills and knowledge of its workforce. 22. The LGO notes that digital technology will make councils’ future workforces look and work quite differently. To achieve the change required, councils need to make good use of digital technology and use the workforce in flexible ways. 23. Digital technology has a strong bearing on a council’s workforce needs. It can be used to re-shape jobs to increase productivity and reduce back-office functions while improving service quality. Technology solutions include online services, customer relationship management systems, mobile digital devices and more recently, artificial intelligence (AI) applications. 24. Councils need to be innovative in their use of technology and build on new working practices that emerged during the pandemic. In doing so, they must also consider service quality and the needs of people experiencing digital exclusion. The council consulted extensively with both its workforce and citizens when developing its Digital North Ayrshire Strategy 2023-28 25. The council’s digital strategy – Digital North Ayrshire 2023-28 – was approved by Cabinet in May 2023. It emphasises that digital is as much about people as it is technology: It is about how people engage with and utilise technology to enable new ways of living, learning, and doing business and sets out its vision to embrace digital and reimagine the work that it does for a digital age. 26. As we reported in our Best Value thematic work in 2022/23, an action plan has been included in Digital North Ayrshire 2023-28 to provide the initial baseline of activity as well as a monitoring framework that will enable progress to be tracked across the life of the Strategy. The first follow-up on actions is due to be presented to ELT in August 2024. 27. When developing Digital North Ayrshire, the council undertook an extensive programme of engagement with a range of staff and citizens via 46
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Digital technology and the workforce | 13 online surveys and face to face meetings. Within the council the team undertaking the work engaged with elected members, Executive Leadership Team, Heads of Service, staff groups and modern apprentices who were asked their views on new ways of working already implemented, what barriers they were experiencing and ideas for the future. Citizens were asked about the extent to which they accessed council services online, reasons for not using online and what would encourage them to use online. One of the key messages emerging from the engagement was that people wanted to shift from face-to-face engagement to doing more online. The council is using digital technology to increase workforce productivity and improve services mainly through the automation of processes. 28. The council’s priority in terms of its customers is to support them to become more digital, designing services that are quick and easy to use making digital the preferred choice. Examples of where it has introduced digital improvements include: • the Streetscene service. This service deals with graffiti, abandoned vehicles, fly-tipping, litter, dog fouling, litter bin inspections, play park inspections and grounds maintenance. The council has introduced an online form for issues to be reported by members of the public that requires them to pinpoint on a map the location of the issue. This information is then passed to Streetscene workers via an App using map coordinates within 30 minutes. This has increased efficiency, replacing a paper-based system whereby jobs would be issued the day after they were reported. • digitisation of more than 40 licensing forms including taxi licenses, alcohol premises licences and public procession notices. To obtain these licences in the past, customers would have to fill in a form and then telephone the council to pay. Officers had to manually match the payment to the form. Payments are now made online when submitting the form and officers can see that payment has been made. • the introduction of a new Contact Us process, using online forms, on the council’s website. Online forms are intended to replace the contact us email address monitored by customer services. This has significantly cut down on the workload for Customer Services and has enabled the queries that customers do make to go directly to the service they are trying to contact, which also enables a quicker response for the customer. The council has established the workforce benefits and productivity gains of its digital technology improvements but there is scope for more of these to be quantified. 29. The council has used digital technologies to improve the efficiency of local residents’ interactions with services, and to assist staff working out in the community. The council has set out the workforce benefits and productivity gains by the introduction of digital in many of these areas but there is scope for more to be quantified and savings calculated. For example: 47
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Digital technology and the workforce | 14 • the introduction of the new Contact Us process has led to the number of contacts coming into services from the website to reduce by 78 per cent since June 2023. This has resulted in a reduction of one FTE no longer being required to manage and direct service requests. • online interactions have increased from 24 per cent in 2021 to 38 per cent in 2023. • the introduction of a web assistant / chat bot in late 2023 has led to over 200 requests every week being answered by the chat bot. Recommendation 3 The council should build on the work it has done to date to demonstrate and quantify what workforce benefits and productivity gains have been made through its use of digital technology. The council is considering how to further enhance the digital skills and knowledge of its workforce. 30. The pandemic led to an increase in the use of digital technology by the council’s workforce. The council conducted a digital engagement survey in March 2021 to inform its digital strategy; Digital North Ayrshire. One of the barriers identified by staff as part of this engagement was lack of digital skills. The council’s digital priority in relation to its workforce is: We will develop our workforce to ensure it is empowered, enabled and inspired to realise the benefits of digital. The council has supported the development of digital skills and knowledge of its workforce but has acknowledged that there is scope to further enhance this. 31. The council introduced its Digi Guru initiative in 2018 with the aim of providing interested members of staff with key digital skills and knowledge that they could then pass on to colleagues if required. Before the Covid-19 pandemic this proved to be very successful with 400 members of staff becoming Digi Gurus. Since the pandemic the council has acknowledged that this model has operated in a different way as individuals are working within different locations (home/base office or other location). As a result, employees are supporting each other utilising digital methods such as Teams chats, Teams calls and screen sharing for support. The council has committed to reconsidering the Digi Guru Initiative and is considering other ways of informing and upskilling its employees’ digital skills. Recommendation 4 The council should consider conducting another digital skills survey to inform the support it provides for improving the digital skills and knowledge of its workforce. 48
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Flexible working and other innovative staff deployment | 15 Flexible working and other innovative staff deployment Agile working has been promoted by the council for a decade and was strengthened in 2021. The council has gathered feedback on wellbeing and productivity in relation to agile working and recognises that further engagement with its workforce would be beneficial. The council’s Voluntary Early Release Programme in 2023/24 is projected to save £2.4 million in recurring savings. A positive relationship exists between the council and Trades Unions. 32. During the pandemic councils needed to make the best use of their existing workforce while continuing to monitor employee wellbeing. Councils continue to look to new ways of working to improve job satisfaction and reduce sickness absence and staff turnover. 33. Home-working and hybrid working (a combination of office and home- based working) have now become commonplace. Some councils are also considering more radical working practice such as a standard four-day working week. However, whatever the working practice, employers need to ensure that service quality and productivity are maintained. Agile working has been promoted by the council for a decade. It was relaunched in 2021 when workstyles were assigned to every post. 34. The council created an Agile Working Guide in 2014 which contained four different workstyles: in building, mobile, flexible and home. At this point workstyles were not aligned to posts. 35. In August 2020, as part of Our Future Working Environment Project, a staff homeworking survey was carried out, and 69 per cent of respondents stated their preference was to continue working from home. As a result of this survey, and due to the new ways of working during the pandemic, the council reviewed and updated its Agile Working Guide. The council consulted with Trade Unions and Heads of Service / Senior Managers. 36. In July 2021, the workstyles guide was relaunched with a slight change to the wording of the original workstyles. This time the council also assigned one of four working styles to each post with the council. Emails were issued to staff who had been working in a different way to confirm their new workstyle. 2,068 emails were issued, and from this, four employees asked for their workstyle to be amended. A Visible Leadership Guide was published to 49
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Flexible working and other innovative staff deployment | 16 provide guidance and support to managers on being visible and engaging and communicating with their teams. 37. The four revised workstyles are as follows, with the number of posts as at April 2024: • Agile – 2,225 (25.1 per cent) • Home – 10 (0.1 per cent) • Mobile - 1,845 (20.8 per cent) • In building – 4,771 (53.1 per cent). The council has gathered feedback on wellbeing and productivity in relation to agile working through various channels during the past few years. A council-wide employee engagement survey has not been conducted since 2019/20 due to resource limitations driven by financial constraints. 38. The council would benefit from gathering further feedback on the impact of agile working on employee wellbeing including work-life balance, and productivity. Trades Unions report that they have received very few calls from their members about agile working, suggesting there are no major issues. 39. The council has a Livewell programme that supports workforce wellbeing. A workforce wellbeing update is presented to the 1st tier Joint Consultative Committee on a six-monthly basis and provides an update on absence along with supports available such as occupational health and Livewell. The council has not carried out an employee engagement survey since 2019/20 due to reduced resources driven by financial constraints. 40. Some aspects of the impact of agile working is captured through the council’s ‘Our Future Working Environment Project’ that realised savings of £0.5M from staff travel, office supplies and property related costs. In addition, a Property Rationalisation Programme is currently progressing to support agile working and the financial challenges. The Child Poverty and Cost of Living Board provides an example of the benefits of agile working. 41. An example of the positive impact of agile working is the Child Poverty and Cost of Living Board. It meets every six weeks for one hour and relies on the Leader of the Council, Executive Directors, Heads of Service, Senior Managers, third sector partners and the NHS including Public Health to inform its strategic approach. Agile working has enabled the coordination of discussions through Teams and due to diary availability is likely to have resulted in more frequent decision-making and a quicker response than scheduled in person meetings – directly supporting the wellbeing of residents. 50
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Flexible working and other innovative staff deployment | 17 Recommendation 5 The council should consider gathering further feedback from staff on the impact of agile working on wellbeing and productivity. The council completed a Voluntary Early Release programme in 2023/24, resulting in 85 employees leaving. 42. In May 2023 the council launched a Voluntary Early Release programme to help address the financial challenges it was facing. Employees were invited to submit an application to request to leave the council. An assessment of the impact on service delivery and associated costs of exit for those staff who volunteered for consideration was undertaken. 43. The programme was led by the HR team, who developed targeted communications, a Frequently Asked Questions document and an online form for people to complete in order to create a structured, automated process. Applications were assessed by service managers and heads of service, with final decisions being made by a VER Scrutiny Panel at the end of October 2023. 44. Eighty-five employees left the council as part of the programme at the end of March 2024. Savings from the programme amounted to £2.4 million. To achieve these savings, 75 per cent of the vacant post had to be put forward as a saving, with the remaining 25 per cent being reinvested in the service. 45. In 2024/25, in its Medium-term Financial Plan the council projects that its workforce will reduce by 79.5 Full Time Equivalent posts through natural attrition, vacancy management, redeployment and voluntary early release. The council is currently reviewing its use of casual workers 46. The council employs just over 1,300 casual workers. Of these, approximately 400 have other employment with the council and 900 (just over ten per cent of its workforce) have solely casual status. The council is currently reviewing its use of casual workers. HR staff liaised directly with services to determine their use of casual workers and how they are managed, and what systems are being used to manage casual workers. 47. A survey was sent out to all casual staff. The survey included questions on whether they wished to remain on the casual register, whether they were interested in a contracted role and the reasons why they preferred a casual contract. These surveys were due to be returned by the end of April and the results will be analysed and included in a report to ELT in September 2024. A positive relationship exists between the Trades Unions and the council. 48. There are positive relationships between Trades Unions and the council. Trades Unions feel they are consulted with appropriately and their views are considered. Trades Unions were engaged with when the workstyles were re- 51
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Flexible working and other innovative staff deployment | 18 launched in 2021 through their membership on the council’s Future Working Environment Working Group. Trades Union representatives meet with HR monthly and with the Chief Executive quarterly. 52
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Developing future skills and capacity | 19 Developing future skills and capacity The council has adopted a wide range of approaches to improve the skills and capacity of its existing and future workforce. It has a well-established modern apprenticeship programme, demonstrating positive outcomes. 49. Councils need to find innovative ways to ensure the workforce capacity and skills they need to deliver services in the future. Training and development opportunities can help to attract and retain employees and ensure skills are in place. Many councils work with their partners to offer apprenticeship schemes or vocational qualifications. Succession planning is also important to develop future leaders and ensure that essential skills are in place. 50. Jobs can be re-designed to optimise the workforce and improve services. For example generic roles across health and social care disciplines. Leaders need to engage with staff and trade unions over fundamental workforce reform. This is particularly challenging in an environment of potential job losses. The council has adopted a wide range of approaches to improve the skills and capacity of its existing and future workforce 51. The council has adopted a wide range of approaches to improve the skills and capacity of its existing and future workforce including modern apprenticeships, graduate apprenticeships, its Leadership Academy, its Skills for Life programme and care at home recruitment work. The council has a well-established modern apprenticeship programme, demonstrating positive outcomes 52. The council has had a modern apprenticeship programme in place for 14 years. The programme is well embedded across services and the council sees it as a practical solution to attracting young people into the council workforce. 53. The council has a good track record with modern apprentices. Since 2019/20 it has recruited 232 people to the programme. Of these: • 129 have gone on to secure jobs (104 with the council) • eight have gone on to attend university or college • 75 are currently continuing with their apprenticeship 53
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Developing future skills and capacity | 20 • of the remaining 20, the majority of these were linked into other employability services the council offers with the support of a key worker. 54. The council aims to take on 45 apprentices each year, and this year plan to take on a higher volume of 12-month placements. Of these placements, the council has a commitment to ringfence 20 per cent of places for care experienced or disabled young people. 55. Education Scotland highlighted the council’s modern apprenticeship programme in youth work as highly effective practice. The programme has developed over the years and is now delivered entirely within the Community Learning and Development service, with staff members having been upskilled to become qualified assessors. 56. The programme provides employment opportunities for young people in the authority from age 16-19 providing training and upskilling of the young workforce. The modern apprentices are involved in delivering youth work across 40 groups and help to deliver various large-scale events, such as Joint Cabinet meetings and Youth Conferences. Many of the modern apprentices have stayed on as sessional workers after they complete their qualification, as well as progressing onto positive destinations. As at September 2023, 110 modern apprentices had completed their qualifications with the service. 57. Like other councils, the council may have to consider reducing the number of modern apprentices it takes on because of financial constraints as a result of changes to the Fair Work Conditionality (requirement to pay the living wage). At present a limited exception has been approved to continue to pay modern apprenticeships at the National Minimum Wage Rate however this may or may not continue beyond 31 March 2025 and is at the discretion of the Scottish Government. Graduate apprenticeship programme 58. The council introduced its graduate apprenticeship programme as a workforce development opportunity and a way to grow its own talent. It developed a strategic partnership with the University of the West of Scotland (UWS) to develop the programme. The programme started in 2023/24 with a cohort of eight employees providing support to each other. Leadership academy 59. The council operates a Leadership Academy which provides structured development programmes to develop essential leadership skills across all levels of management throughout the council. The council offers a programme, Skills for Life, that helps people develop appropriate skills for the workforce 60. The council’s employability service offers a programme called Skills for Life which offers individuals work experience that helps them develop skills in areas which might otherwise prevent them from being offered an interview. Individuals are matched to different roles in the council, such as in facilities management, care at home or business administration. This year the council 54
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Developing future skills and capacity | 21 launched opportunities to develop classroom assistant experience which will then enable people to apply for future vacancies, as one of the essential criteria of this role is experience which is difficult to gain. 61. Seventy individuals have been involved in the programme, all with positive outcomes. Thirty have moved into vacancies within the council and the other 40 have gained employment in third sector or anchor organisations to the council. Those involved in the programme also have access to the council’s redeployment programme. At 13 weeks into the placement, the individual can get access to any redeployment vacancies, rather than waiting until the end of the programme before being able to gain employment. The Health and Social Care Partnership has introduced alternative methods to recruit to care at home posts 62. Since 2020 the Care at Home service has been looking at alternative methods to support recruitment activity to care at home posts. The level of applications for frontline care at home posts was often very low, with high levels of applicants dropping out at various stages of the recruitment process. 63. The service decided to devise a new campaign and introduced face-to- face recruitment events, where individuals could come along to receive advice and guidance on applying for vacant posts. This also include support to complete application forms, advice on interview techniques and general information on working in social care. Interviews are also offered on the day with an aim to reduce the level of withdrawal from the recruitment process. 64. This initiative has had a level of success with the events being well attended. Over 230 people have attended events since November 2023 and there has been a 16 per cent reduction in frontline care at home assistant vacancies. 55
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Joint workforce arrangements across services and partners | 22 Joint workforce arrangements across services and partners There is scope for the council to explore further where it can work together with partners to share services and increase collaboration. It currently shares its Corporate Fraud Team with East Ayrshire Council and has a Pan Ayrshire contract with East and South Ayrshire in place in relation to Occupational Health. 65. Councils should look to work collaboratively with their partners to make the best use of their existing workforces and plan for the particular workforce needs in their areas. They should also work across traditional service department roles within councils to deliver improved services and outcomes. 66. Examples of this include generic working across health and social care, professional posts or functions shared between councils, and services delivered through empowered communities. The council shares its Corporate Fraud Team with East Ayrshire Council and has a Pan Ayrshire contract with East and South Ayrshire in place in relation to Occupational Health. 67. A Corporate Fraud Team (CFT) for North and East Ayrshire, to investigate fraud and share learning and information, has been in place since August 2016. It is delivered by North Ayrshire Council but is jointly funded by both councils. The arrangement was initially in place for three years but has been extended on numerous occasions, with it most recently being extended until March 2025. The CFT work deals with referrals of fraud around Council Tax, Business Rates, Scottish Welfare Fun, Discretionary Housing Payments, Blue Badges and Housing Tenancies, and acts as the first point of contact for the National Fraud Initiative. The benefits of a shared CFT include shared learning, freeing up internal audit resources, and being a single point of contact for employees and the community. 68. North Ayrshire Council, East Ayrshire Council and South Ayrshire Council have contracted jointly for Occupational Health Services since 2015. This arrangement enables the councils to tender for occupational health services together allowing them to obtain a more competitive package of services rather than each council contracting separately. The current contract has been in place since August 2019 and is due to be re-tendered in 2024. 69. Since 2019 the three councils have worked jointly to manage the contractual relationship through regular contract management meetings with the provider and by utilising a balanced scorecard approach to assess contract performance. By working collaboratively, they have been able to 56
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Joint workforce arrangements across services and partners | 23 leverage further supports and initiatives from the Occupational Health provider, for example the introduction of an online portal for referrals to enable managers to do this themselves. This has also enhanced working relationships between HR colleagues which have had wider benefits in terms of the ability to collaborate on other HR related matters over the years. Recommendation 6 The council should explore further where it can work together with partners to share services and increase collaboration. 57
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Measuring the impact of workforce planning | 24 Measuring the impact of workforce planning The council could improve how it monitors the effectiveness of its workforce planning practice by regularly reporting progress against workforce planning priorities. The council has a rich source of available data in relation its workforce and would benefit from developing a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. 70. Councils should monitor the impact of their workforce planning and delivery approaches. This should include cost, service quality and productivity benefits as well as employee wellbeing. This in-turn should inform their workforce planning approach. Councils and their partners should also understand the wider impact of their employment practice on the local economy. The council reports on workforce planning through Council Plan progress updates and an annual ELT workforce planning update. 71. The council set out in its Workforce Strategy 2023-28 its intention to monitor progress in workforce planning through its Council Plan progress reports with service-level workforce planning being monitored through updates to its Executive Leadership Team. 72. The council reports on its Council Plan 2023-28 every six months. While these updates are informative, providing updates on workforce planning initiatives, they do not provide a clear sense of whether the council has progressed in workforce planning at the pace intended. In January 2024 the Council Plan mid-year progress report included a section on workforce planning. It discussed the intake of modern, graduate and craft apprenticeships, referred to the six-monthly workforce planning meetings at service level having taken place and noted that the VER programme would conclude in March 2024. 73. The Council Plan progress report sets out performance across 26 performance indicators. None relate directly to workforce planning. It also contains an action tracker that includes one action related to workforce - Effective workforce planning ensuring that we have the right skills/resources to deliver priorities. This action was deemed to be on track but it is not clear how progress against this action is being measured. The council would benefit from developing a performance dashboard to track progress in the delivery of the workforce strategy. 58
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Measuring the impact of workforce planning | 25 74. Once a year the council’s Executive Leadership Team considers a workforce planning update. The most recent update was considered in February 2024. It contains a wealth of information but it is does not clearly set out what the workforce planning priorities are for the council as a whole. 75. In the ELT update, for each of the council’s four directorates, a summary is provided of the PESTLE analysis from the service workforce plans, the people implications (setting out good news stories and challenges) and the directorate’s priorities. The priorities are split into short, medium and long- term. For two of the four directorates, the priorities listed were not workforce specific. For the two directorates that did set out workforce-specific priorities these tended to be lacking in detail and it was not clear what success would look like. For the HSCP examples of the priorities include: • growing capacity in critical services (short term) • skills mix and entry roles (short term) • succession planning (medium term) • fair work across services (medium term) • National Care Service (long term). The council has detailed service-level workforce action plans. It needs to develop a corporate-level workforce action plan against which progress can be monitored. 76. The council has developed detailed service-level workforce action plans, updated every six months, as described in paragraph 19. However, as noted in paragraph 16, the council’s Workforce Strategy 2023-28 does not set out the council’s corporate workforce planning priorities or include a corporate- level action plan. This means it is not possible to track the council’s progress in achieving its workforce planning priorities. Recommendation 7 In addition to providing general workforce planning updates, the council should regularly report its progress against its workforce planning priorities to elected members through its Council Plan updates or other means. There is scope for the council to draw upon the information it already collects to develop a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. This could help to inform future workforce planning. 77. As described in paragraph 21, the council has developed a wide-ranging suite of user-friendly, real-time data using Power BI for services to use. It also publishes employee statistics such as the age breakdown of its employees and absence rates across various publications, including its equality mainstreaming report and the LGBF. Bringing the council-level workforce data together into one place and providing commentary on this could provide 59
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Measuring the impact of workforce planning | 26 a useful overview for elected members and other interested parties as well as helping the council provide an assessment of overall impact of workforce planning. There is also more scope for the council to be more explicit about what success will look like. 78. The Improvement Service publishes tools to help councils with their workforce planning. The council may wish to use these to help capture the effectiveness of its approach. The LGA workforce planning maturity matrix is a table for councils to use to measure their current capability and maturity in relation to different aspects of workforce planning. It can provide a framework for organisations to improve their workforce planning capabilities. Recommendation 8 The council should develop a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. This could help to inform future workforce planning. 60
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Appendix 1 | 27 Appendix 1 Improvement Action plan Issue/risk Recommendation Agreed management action/timing 1. Corporate workforce planning priorities and action plan The Workforce Strategy 2023-28 sets out the council’s approach to workforce planning but does not articulate what its strategic workforce priorities are or include a corporate-level action plan. Risk – There is a risk that the council’s approach to workforce planning is not strategic and progress cannot be measured. The council should establish corporate workforce planning priorities and develop a SMART action plan to allow progress in delivering these priorities to be measured. Management response The Workforce Strategy will be updated to include corporate workforce planning priorities and an action plan to allow progress to be measured. Responsible officer Fiona Walker Actioned by 31 March 2025 2. Alignment of workforce strategy to key strategies and plans and inclusion of data The Workforce Strategy 2023-28 is not aligned to the council’s other key strategies and plans and does not include an analysis of council-level workforce data. Risk – There is a risk that the council is not clear about the way in which workforce planning can help deliver its strategic priorities and it may not be using the council-level workforce data it has to full effect. The council’s workforce strategy should be updated to align with all four Council Plan 2023-28 priorities and with other key strategies and plans. It should include an analysis of council-wide workforce data and set out what the required skills, learning and development needs of its staff are. Management response The Workforce Strategy will be updated to ensure alignment to all Council Plan priorities, other key strategies/plans and include an extract of council-wide workforce data. Responsible officer Fiona Walker Actioned by 31 March 2025 3. Measuring the impact of digital technology improvements The council should build on the work it has done to date to demonstrate and quantify what workforce benefits and Management response Further work will be undertaken to capture and 61
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Appendix 1 | 28 The council has established the workforce benefits and productivity gains of its digital technology improvements but there is scope for more of these to be quantified. Risk – There is a risk that the council does not fully understand the workforce benefits from digital technology improvements to inform future decision- making. productivity gains have been made through its use of digital technology. quantify efficiencies from digital improvements and for this work to be incorporated within the Council’s Medium- Term Financial Planning Responsible officer Mark Boyd Actioned by 31 March 2025 4. Improving digital skills The council is considering how to further enhance the digital skills and knowledge of its workforce. Risk – There is a risk that the council does not focus its digital skills training in the right areas because it does not know what its employees’ digital learning needs are. The council should consider conducting another digital skills survey to inform the support it provides for improving the digital skills and knowledge of its workforce. Management response A digital skills survey will be conducted to inform future development interventions. Responsible officer Fiona Walker Actioned by 31 March 2025 5. Gathering feedback on the Impact of agile working The council has gathered feedback on wellbeing and productivity in relation to agile working through various channels during the past few years. A council-wide employee engagement survey has not been conducted since 2019/20 due to resource limitations driven by financial constraints. Risk – There is a risk the council is not aware of the impact of agile working on wellbeing and productivity. The council should consider gathering further feedback from staff on the impact of agile working on wellbeing and productivity. Management response Further feedback will be gathered from those employees who are deemed an agile workstyle to gauge continued benefits on wellbeing and productivity. Responsible officer Fiona Walker Actioned by 31 March 2025 6. Joint workforce arrangements There is scope for the council to explore further where it can work together with partners to The council should explore further where it can work together with partners to share services and increase collaboration. Management response The Medium-Term Financial Planning process for 2025/26 to 2027/28 will include the exploration of further 62
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Appendix 1 | 29 share services and increase collaboration. Risk – There is a risk the council may not be utilising opportunities for shared services and collaboration opportunities across partner organisations. opportunities for sharing services and collaboration across partner organisations. Responsible officer Mark Boyd Actioned by 31 March 2026 7. Measuring the impact of workforce planning The council could improve how it monitors the effectiveness of its workforce planning practice by regularly reporting progress against workforce planning priorities. Risk – There is a risk that the council’s workforce planning arrangements are not supporting the delivery of the strategic priorities in its Council Plan. In addition to providing general workforce planning updates, the council should regularly report its progress against its workforce planning priorities to elected members through its Council Plan updates or other means. Management response Workforce planning updates and progress against priorities will be regularly reported through Council Plan updates and other means. Responsible officer Fiona Walker Actioned by 31 March 2025 8. Measuring the impact of workforce planning There is scope for the council to draw upon the information it already collects to develop a performance dashboard to monitor and inform future workforce planning practice. Risk – There is a risk that the workforce planning information the council already collects is not being used to full effect. The council should develop a performance dashboard to provide a user-friendly overview of the impact of its workforce planning. This could help to inform future workforce planning. Management response A performance dashboard will be developed to monitor and inform future workforce planning. Responsible officer Fiona Walker Actioned by 30 September 2025 63
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Appendix 1 | 30 Workforce innovation - how councils are responding to workforce challenges Audit Scotland’s published material is available for download on the website in a number of formats. For information on our accessibility principles, please visit: www.audit-scotland.gov.uk/accessibility For the latest news follow us on social media or subscribe to our email alerts. Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN Phone: 0131 625 1500 Email: info@audit-scotland.gov.uk www.audit-scotland.gov.uk AS.4.0 64
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NORTH AYRSHIRE COUNCIL 29 August 2024 Audit and Scrutiny Title: Climate Change Target & Associated Policies Purpose: To update the Audit and Scrutiny Committee on the Council’s progress of the Sustainable North Ayrshire Strategy (2024-27). Recommendation: It is proposed that the committee note the progress and ongoing action to reduce carbon emissions in North Ayrshire. 1. Executive Summary 1.1 The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 requires that net zero emissions are achieved by 2045, however in April 2024, Scottish Government announced that it will be proposing legislation to set a revised pathway to the 2045 net zero target, removing 2030 and 2040 statutory targets. 1.2 In December 2023, Cabinet approved the Sustainable North Ayrshire (SNA) Strategy 2024-2027, which aims to tackle both the climate and nature crisis. This report provides an update on progress and influential policies around our climate change ambition. 1.3 As Scottish Government considered the findings of the most recent Climate Change Committee report on carbon emission reduction, Audit and Scrutiny Committee requested an update on the Council’s climate change target and associated policies, such as biodiversity, EV, and fleet decarbonisation. This report aims to provide an update on the Council’s current position for each. 2. Background 2.1 The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 requires Scotland to reach net zero emissions by 2045, with interim targets originally set of 75% reduction in emissions by 2030 and 90% reduction in emissions by 2040. The Council declared a climate emergency in June 2019 and has committed to achieve net zero carbon emissions by 2030. 2.2 In March 2024 the Climate Change Committee (CCC) published its most recent assessment of Scotland’s progress on climate mitigation. This report stated that Scotland was failing to achieve its ambitious climate goals and that the acceleration required in emissions reduction to meet the 75% reduction by 2030 target was now unachievable. In April 2024, Scottish Government announced that it will be proposing legislation to set a revised pathway to the 2045 net zero target, removing the 2030 and 2040 statutory targets. 2.3 In December 2023, Cabinet approved the Sustainable North Ayrshire (SNA) Strategy 2024-2027, which aims to tackle both the climate and nature crisis. Our net zero Agenda Item 6 65
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emissions by 2030 ambition for North Ayrshire remains, and the target of halting biodiversity loss by 2030 and reversing declines by 2045, has been introduced. This is in-line with the national Biodiversity Framework. 2.4 Graph 1 below is a representation of the Council’s own carbon emission journey since the baseline year of 2005/06. Through carbon reduction projects and policies, emissions have reduced across buildings, waste, street lighting, and transport by 69.4% since 2005/06. This is a reduction of 46,974tCO2e. Graph 1 – Council estate emissions in tonnes of carbon dioxide equivalent (tCO2e) 2.5 The SNA includes nine strategic priorities and actions identified under five workstreams, specifically: Energy; Nature; Transport; Waste; and Adaptation. Progress on each of the forty-six actions is reported via the Council’s corporate performance system on a quarterly basis, to the Climate Change Steering Group, and to the Head of Service for Sustainability, Transport and Corporate Property. 2.6 Some examples of progress so far include: • Development of two solar PV farm projects, currently in construction phase. • Investigation of proposals for wind and solar technology for i3 Strategic Investment Campus. • Preparation of community climate action plans for each locality. • Feasibility report for decarbonisation of non-domestic estate undertaken, has been presented for consideration by senior officers in the Sustainability, Transport and Corporate Property Service. • Preparation of the Carbon Footprint and Project Register to gather carbon reduction information from across the Council. • Undertaking a series of LED lighting replacement projects in depots and schools. • Replacement of two Building Management Systems to save energy by increasing heating control. • Delivery of energy lessons to 1,152 pupils across North Ayrshire. • Publication of North Ayrshire’s first Local Heat and Energy Efficiency Strategy (LHEES). • Over £560k of funding has been released in North Ayrshire to support energy efficiency improvements in private sector housing through ECO4 Flex. 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30Council Emissions (tCO 2e) Year Council Estate Emissions (tCO2e) Forward Projection to 2030 66
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• Initiation of Phase 3 of the Energy Smart programme, to deliver energy efficiency measures to private sector households. • Installation of a further 8 workplace charge points, supporting fleet decarbonisation. • Development of a Nectar Network project with Scottish Wildlife Trust, utilising Nature Restoration funding and supporting aims of a Nature Network. • Development of the North Ayrshire Nature Network strategy, to be presented to Cabinet in the Autumn. • An extensive energy awareness campaign is underway, including three i-Learn modules covering energy and climate, adaptation, and nature, and work is underway to deliver Carbon Literacy training to staff, senior management, elected members and community organisations. • Installation of solar PV panels in 1,510 homes across the Council’s domestic estate as an integral part of the re-roofing programme. • Investigation and implementation of a property rationalisation programme, particularly in the Irvine locality, reducing the building footprint and subsequent carbon emissions. • On-going decarbonisation of the fleet through the replacement of 66 combustion engine vehicles with Electric Vehicle alternatives. • Continued implementation of our 2030 Woodlands: A Tree Planting Strategy, where 36,366 trees have been planted, and work is ongoing to achieve the 108,000 tree target. 2.7 The above examples are captured within the SNA Strategy which builds on the momentum of the previous Environmental Sustainability and Climate Change Strategy actions. Graph 1 above indicates that although Council estate carbon emissions continue to decrease annually, there will be residual emissions to account for by 2030. For this reason, sequestration measures are vital to achieving net zero status. The Tree Planting and Nature Network strategies and investigation of marine sequestration will support this action, by removing carbon dioxide through the photosynthesis process. 2.8 The conservative annual reduction expected is approximately 3% year on year . One of the actions withing the SNA Strategy is to develop a Carbon Project Register, to identify carbon reduction projects and monitor the emissions reduction associated with each project. Committing to carbon reduction projects in this way will better support annual projections. The Carbon Project Register is in development and will be initiated prior to the end of the year. 2.9 Meanwhile, the estimated annual reduction in emissions for 2024/25 are 622tCO2e, and we aim to achieve this through decarbonisation of non-domestic buildings and fleet, and increased renewable energy generation. Furthermore, the focus on behaviour change is an integral part of emission reduction, and this is being addressed through carbon literacy programmes, awareness activities and school engagement sessions. 2.10 International and national policies helped to inform the development of the SNA. We will continue to align with new guidance, such as the impending Climate Delivery Framework (which aims to support the establishment of a net zero delivery programme for Scotland, focussing on transport and heat decarbonisation polices) and the Heat in Buildings Bill (which will set out laws for how domestic and non-domestic buildings are heated, as well as how energy efficient the buildings need to be). 2.11 There are many local policies and strategies which support the SNA vision to deliver the Council Plan (2023-28) climate change priority. These are noted within the SNA, and some examples of these include the Local Biodiversity Action Plan, Electric Vehicle strategy, and Fleet Decarbonisation strategy. 67
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Local Biodiversity Action Plan (LBAP) 2.12 The existing LBAP (2019-2031), sets out the Council’s ambition to protect and restore biodiversity, connect people with the natural world, and maximise the benefits for North Ayrshire of a diverse natural environment and the services it provides. 2.13 In light of mounting evidence that Scotland continues to experience dramatic declines in biodiversity, the Scottish Government has set out an ambitious new framework to halt biodiversity loss by 2030 and reverse it with large-scale restoration by 2045. The new Scottish Biodiversity Strategy states that each local authority is required to deliver a ‘Nature Network’ in their own area. A Nature Network is a network that connects nature-rich sites, restoration areas, and other environmental projects through a series of areas of suitable habitat, habitat corridors and stepping-stones. A Nature Network strategy for North Ayrshire is currently being developed for approval. 2.14 In addition, a new Nature Bill is expected to be laid before parliament in 2026, which will contain a range of nature-based targets. The current LBAP will be revised to reflect these forthcoming targets, and work is underway with the North Ayrshire Biodiversity Partnership to develop a robust and effective LBAP. The delivery will involve considerable community buy in, partnership working and interdepartmental cooperation. Electric Vehicle strategy 2.15 In May 2021, Cabinet approved the Council’s first Electric Vehicle (EV) strategy (2021- 25). This strategy aims to increase the number of EVs being used throughout North Ayrshire by creating a robust network of EV charge points. It also established a target to achieve one electric vehicle (EV) charge point for every nine EV’s registered in North Ayrshire. 2.16 Since establishing the strategy, 33 publicly accessible charge points have been installed across North Ayrshire to support a just transition to EVs. The Scottish Government has set a target to phase out petrol and diesel cars and vans by 2030 to help create a healthier, cleaner, and greener Scotland. 2.17 To further support the roll out of EV infrastructure, the Council is working in partnership with Ayrshire Roads Alliance (ARA), to secure £3.2m of funding from Transport Scotland, to install a further 307 charge points across Ayrshire. With support from Scottish Futures Trust, we have appointed specialist support to assist with the development of the tender documentation for a concession contract with a private sector charge point operator. It is anticipated that the operator will be in place by mid 2025. 2.18 The concession contract would see an additional £2m investment from the private sector operator, who would take on the existing publicly accessible charge points, whilst installing and maintaining new charging infrastructure. The tariff would be set by the private charge point operator; however the procurement activity includes a stipulation that tariff is mirrored across each Ayrshire local authority, and remains at a fair and accessible rate for the public, whilst accommodating the commercial business case for the operator. Fleet Decarbonisation 2.19 Public bodies are required to phase out the need for petrol and diesel vehicles in Scotland’s public sector fleet by 2030. 2.20 The Council’s fleet is made up of approximately 566 road registered vehicles and plant which are either leased or owned outright. The current fleet includes a range of vehicles intended to serve varying purposes, with some vehicles more suited to switching from conventional fuels to electric than others. 68
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2.21 Following an extensive assessment with assistance from an external specialist, a route map to decarbonise the Council’s fleet was presented to and approved by Cabinet in May 2023. The route map contains fourteen recommendations to build on the progress already made in decarbonising the fleet. 2.22 A working group has been established, with project management resource provided by the Transformation team, and progress reported through the Sustainability and Transformation boards. Data analysis is currently underway to identify where vehicles are parked overnight to better support overnight charging infrastructure, whilst a mapping exercise is underway to locate workplace and public charge points across all localities and identify opportunities to increase service uptake of electric fleet vehicles. In addition the use of capital budgets is optimised to support decarbonisation of fleet through the vehicle replacement programme. 2.23 The UK Government Decarbonising Transport plan for Heavy Duty Vehicles (HDV) details that all sales of new medium sized trucks (up to and including 26 tonnes) to be zero emissions from 2035, with the heaviest (above 26 tonnes) zero emissions by 2040. 2.24 In support of decarbonising the existing HDV fleet, an interim approach to use hydrotreated vegetable oil (HVO) is underway. This offers a short-term solution for HDV fleet where electric replacements are not available or are cost prohibitive. It is anticipated that HVO can deliver up to 90% reduction in carbon emissions. Officers are currently collaborating with Procurement services to secure a supply of fuel. 2.25 An innovative project is underway in partnership with Strathclyde University and Power Circle Projects, to identify the commercial feasibility of generating green hydrogen from landfill gas. Should this prove viable, there may be future potential to supply green hydrogen to waste collection vehicles, or perhaps to local industry as a fuel source. The outputs of the study are due by the end of this year. 3. Proposals 3.1 It is proposed that the committee note the progress and ongoing action to reduce carbon emissions in North Ayrshire. 4. Implications/Socio-economic Duty Financial 4.1 Delivery of the Sustainable North Ayrshire Strategy is not fully funded and consideration will be required at future budget setting Council meetings regarding the prioritisation of spend. Exploration of external funding opportunities and innovative partnership models will also be critical in order to maximise investment and meet our objectives. The financial implications for decarbonising the non-domestic estate are anticipated to be positive as making buildings more energy efficient reduces the financial burden on utility spend for the Council. Investment Funding will be utilised to implement the recommendations from the recent decarbonisation study. External funding provided through Nature Restoration will be utilised to maximise delivery of the Nature Network strategy, and resource has been committed to the fleet decarbonisation route map. 69
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Human Resources 4.2 Previously vacant posts within the Sustainability service are being filled following a robust recruitment exercise, and external funding is being maximised to support temporary posts to deliver strategic projects, such as the Local Heat and Energy Efficiency Strategy. Legal 4.3 Under the Climate Change (Emissions Reduction Targets) (Scotland) Act 2019, all public bodies in Scotland have a duty to contribute to the delivery of the net zero emissions target. Equality/Socio-economic 4.4 The ambition to decarbonise heating systems and improve energy efficiency in all buildings contributes to our socio-economic duty by ensuring our homes and buildings are well insulated and energy efficient, making them cheaper to heat and reducing their emissions. 4.5 The provision of EV charge points throughout North Ayrshire supports the just transition to EV’s, making them fair and accessible to all. Climate Change and Carbon 4.6 This update provides progress on the Council’s net zero ambition and aspiration to tackle the issue of ‘heat and fleet’ whilst addressing the nature crisis. Key Priorities 4.7 The works undertaken are in keeping with the aim ‘To achieve net-zero by 2030’ within the Council Plan 2023-28. Community Wealth Building 4.8 Community Wealth Building is at the heart of the Climate Change Steering Group, key stakeholders in the development and delivery of the SNA, with opportunities to work collaboratively are sought out and implemented. 5. Consultation 5.1 Progress updates have been provided from across various services for this report. RUSSELL McCUTCHEON Executive Director (Place) For further information please contact Laurence Cree, Head of Sustainability, Transport and Corporate Property, on (01294) 324514. Background Papers 0 70