Issue - meetings

For those charged with Governance (the Audit Committee) to consider the statutory Annual Report from KPMG, which highlights their findings from the audit of the Council’s statutory accounts, value for money and other relevant information.

Mr Kaycee Ikegwu, Head of Finance (Housing & Chief Accountant), Mr Tim Cutler and Mr Josh Parkinson, KPMG introduced the report.

The meeting heard:

·         Expectations to the Council was being driven by two main factors. Firstly, the level of savings being approved and whether they were transformational or small level savings and, secondly, the degree to which the agreed savings within the budget were also being delivered. The budget may say that there was around £60 million of savings that had been identified, but a lot of these related to the undelivered savings from the last two financial years. The Council had the ability to truly transform. Adult Social Care was a good example where larger value savings could be made. However, there was also the management capacity capability to actually execute those plans.

·         The onus could not be put solely on management, because the degree to which some of the transformational savings were being approved was still important. KPMG would observe what happened at the March 2026 budget process and then respond accordingly.

·         KPMG’s role as local auditors was to give assurance to the taxpayer. There was a situation at the Council which was deteriorating due to the increased reliance on resilience funding to balance the budget as this created a debt that would sit on the Council’s balance sheet and would require servicing for the foreseeable future. This would need escalating and highlighting. The statutory recommendation would involve a report from KPMG to the Council. This would be part of the escalation process. It was likely that Cabinet would respond and this would be publicly shared and copied to the secretary of state.

·         After an issue had been highlighted, it was then up to other parties to decide on what the appropriate response was.

·         The Council was aware of the challenges relating to its commercial property. There were a number of leases and rents that needed review. Much work was focused on this and had been pointed out as part of the report by KPMG. It had been reported that pace had picked up in the last six months or so. All options were being considered. No options had been ruled out in terms of additional capacity. The reviews could either be done with a smaller amount of resources and take longer or with a larger amount of resources, but quicker. These options were being tested, including if it would be cost effective to bring in some external support to the internal team given the work still required. The Council wanted to get to a position where all rent reviews and lease reviews were current and then return to a more business as usual stance. Ensuring that the Council collected all the income that it was due was going to be an important indicator in improving its financial sustainability. Additional capacity was needed, but how it would be done was still under consideration.

·         If the Council was going to significantly increase the level of savings that it delivered, 80%  ...  view the full minutes text for item 8