Agenda item

This report details the work undertaken by Internal Audit in the period 7 October 2023  to 31 January 2024 and focuses on progress on internal audit coverage relative to the approved internal audit plan, including the number of audit reports issued and finalised – work undertaken by the external provider (Mazars).

Mr Minesh Jani, Head of Audit and Risk Management introduced the report.

The meeting heard that:

·      The area of the delivery of leisure services was assigned nil assurance because there were significant deficiencies in how the fusion arrangement was being managed. Deficiencies were identified in the contract management process. Despite this, the escalation had not been applied at the time of the audit. Progress had been made since, but at the time, those instances of failings did not lead to any performance issues or penalties. Under the contract, there were some stipulations around what was expected of the contractor and this had not been fulfilled in a number of areas. There was a need for a service plan and the setting of key performance indicators. There had been a health and safety review by an external company which had identified issues, but these were not being addressed. As a result, the Council was exposed to health and safety risks, delivery risks and contract risks resulting in nil assurance. The audits planned for the next year were to support the organisation’s move to bring services back into the Council. This would present a new challenge and a new way of operating. There was a need to support the service in putting in place the right governance for the management of the services.

·      In relation to Pendarren House, a review had been requested by the service. It identified gaps in the service, most notably, the need for making sure that staff were trained in safeguarding and safeguarding arrangements, need for maintaining a proper risk register, the need to appoint a Deputy Child Protection Lead and key performance indicators to monitor and manage the operations of Pendarren. The centre was still open and many of the recommendations had been implemented. An update would be sought on all the recommendations. This update would be circulated to the Committee.

·      Regarding Pendarren House, the Council’s risk appetite in this area was very low, so the auditors had been selective of the level of control that the Council wished to see and management had been acting fast in responding. Steps were being taken to deal with the specific issues and monitoring of progress would be dealt with by the key performance indicators. A follow up in the area would be done to make sure the arrangements were robust.

·      In relation to the leisure service, the last annual report indicated that contract management across the organisation was not robust enough. The Procurement team would be implementing a new system. However, it also needed to remodel the level of scrutiny it applied across the organisation. At the moment, spending scrutiny was at £160,000. Any spend above £160,000, there was an automatic requirement for the Strategic Procurement team to be engaged. A lot of the Council’s current activities which did not involve procurement would do so and this would allow the Council a greater level of oversight in answering some of the specific questions that were raised around single tenders, but also improve contract management. Training for these systems for this would be required, especially around contract management.

·      The responsibility for making sure contracts were monitored was always with the services. They were responsible for making sure they managed whatever contracts they had. However, Strategic Procurement had a role in making sure that they did they defined acceptable levels of performance and that this picture was provided to services so that they could adhere to those standards. At the moment, there was a varying degree of contract management. There were some contracts which were well managed, but they tended to be in areas where people were used to managing contracts all the time. Where the service did not fully appreciate how to manage a contract, this was where strategic procurement had a role in defining what that should look like and offering help and advice to manage those contracts. If a contract was not progressing well, then a protocol should be in place. 

·      It was unclear what state the issues that Pendarren House had and therefore a query would be made to the service and an update would be provided to the Committee.

RESOLVED:

To note the audit coverage and follow up work completed.