Agenda and minutes

To receive any apologies or substitutions for the meeting.

Apologies were received from Cllr Stuart Wheeler and Cllr Nick Botterill (Cabinet Member for Finance – non voting Member of the Committee).

To confirm and sign the minutes of the meeting held on 25 July 2023.

The minutes of the last meeting held on 25 July 2023 were presented for consideration.

The Chairman stated that regarding minute 26, he had requested that thanks be passed to the former Chairman Cllr Mark Connolly and to Cllr Edward Kirk for their work on the Committee. It was,

Resolved:

To approve and sign minutes of the last meeting as a true and correct record, following the addition of thanks to Cllr Mark Connolly and Cllr Edward Kirk to minute 26.

To receive any declarations of disclosable interests or dispensations granted by the Standards Committee.

There were no declarations of interest.

To receive any announcements from the Chairman.

There were no Chairman’s announcements.

The Council welcomes contributions from members of the public.

Statements

If you would like to make a statement at this meeting on any item on this agenda, please register to do so at least 10 minutes prior to the meeting. Up to 3 speakers are permitted to speak for up to 3 minutes each on any agenda item. Please contact the officer named on the front of the agenda for any further clarification.

Questions

To receive any questions from members of the public or members of the Council received in accordance with the constitution.

Those wishing to ask questions are required to give notice of any such questions in writing to the officer named on the front of this agenda no later than 5pm on Tuesday 12 September 2023 in order to be guaranteed of a written response. In order to receive a verbal response questions must be submitted no later than 5pm onThursday 14 September 2023. Please contact the officer named on the front of this agenda for further advice. Questions may be asked without notice if the Chairman decides that the matter is urgent.

Details of any questions received will be circulated to Committee members prior to the meeting and made available at the meeting and on the Council’s website.

There were no public questions or statements received.

To receive an Accounts and Audit update.

Lizzie Watkin, Director of Finance and Deputy Section 151 Officer, presented the Accounts and Audit update.

The update was being provided following the briefing note sent to Members after the July meeting of the Committee. As Members were aware there had been delays to the audit process and in getting the Statements of Accounts (SoA) 2019/20 signed off. There were national issues regarding the completion of accounts which had been discussed at length at previous meetings of the Committee.

The backstop date to sign off the SoA 2019/20 was 31 December 2023. The focus remained on getting those accounts through the process and there would need to be a push to draw those to a close. A more in-depth report would come to the November meeting of the Committee, and it was hoped that at that meeting the Committee could accept the audit opinion, otherwise a delegation may be required.

The backstop dates for the other outstanding accounts were as follows:

·       Statement of Accounts 2020/21 and 2021/22 – 31 March 2024

·       Statement of Accounts 2022/23 – 30 August 2024

For the SoA 2023/24 the council would have new auditors (Grant Thornton) and the finance team were already planning with them how the process for those would work. The backstop date for the SoA 2023/24 was 31 March 2025.

At present it was not entirely clear how the whole process regarding backstop dates and future accounts would work, so the Committee would be kept updated.

Ian Howse, Deloitte, agreed with the officer and hoped to complete the audit for the 2019/20 accounts by the backstop date of 31 December 2023. The backstop dates were a practical expediency to the situation that Wiltshire Council, and many other local authorities found themselves in. What would be as important would be what happened to prevent the backlog occurring again. Mr Howse was very encouraged by the work of the National Audit Office (NAO) who were revising the code of practise. However, he felt that the Chartered Institute of Public Finance and Accountancy (CIPFA) codes should also be reviewed. Whilst encouraged by the backstop positions, it was stated that it would likely lead to a disclaimer opinion for SoA 2019/20. The aim for both Deloitte and Wiltshire Council was to avoid the backstop dates. However, there was a lot of work for both the auditors and the finance team to get all the audits completed by 30 August 2024.

In response to a question regarding whether there were sufficient human resources to meet the backstop dates, for both the auditors and the council, the officer explained that the council had additional resources in place to deliver all the sets of accounts by the end of August 2024. However, in the officer’s opinion it may not be possible to achieve as robust a set of accounts as one would wish, due to the timescales involved. There were concerns regarding completing the 2020/21 and 2021/2022 accounts by 31 March 2024, as it would be  ...  view the full minutes text for item 44.

To receive the annual Stone Circle governance update.

Perry Holmes, Director Legal and Governance and Monitoring Officer presented the Stone Circle Annual Governance Update.

The officer explained that Stone Circle was set up in 2019. In 2021 he and Andy Brown, Corporate Director Resources & Deputy Chief Executive (S151 Officer) had undertaken a governance review to see if best practice was being adhered to. The report set out the recommendations approved by Cabinet in September 2021 and the activity that had occurred. Five of the seven recommendations were complete. Stone Circle had been set up with the principal idea to rent out houses above council house rates but below market value rates. The council invested in the company by loaning money to it. The model was similar to a housing association return model, with returns made in approximately 50 years.

The governance structure was highlighted, including the Shareholder Group, Overview and Scrutiny and Audit and Governance.

The Local Partnerships guide mentioned in the report published an update in 2023, and Wiltshire Council was broadly in compliance with this. Lizzie Watkin, Director of Finance and Deputy S151 Officer, was a director of the company so we had clear line of sight.

In terms of whether the council’s money was safe it was highlighted that there was a capital value to offset the loan arrangement. In relation to the development company, there was slightly more risk as a lot of money was loaned upfront and the money not returned until the houses were sold. However, this was the lesser activity of the company. The officer felt that when we looked at best practice we were in a very good place and that risks were minimised.

During debate it was stated by Members that they were not seeing the assurances they wanted within the report. It was questioned when we would break even. Financial concerns were raised regarding the housing and rental markets and concerns were raised regarding the risk to the council of this project. A loss was being made at present and it was felt this should be quantified and assessed. Millions of pounds were invested and many Members were unaware. Whether there was an exit strategy in place if things did not go to plan was questioned, and what the cost to the council would be if that happened. It was requested that quarterly finance reports for Stone Circle come to the Audit and Governance Committee.

The officer explained that one needed to remember who was responsible for what under the governance arrangements. It was acknowledged that there was a lack of financial detail in the report, as the Audit and Governance Committee were responsible for looking at the governance framework. Detailed financial information such as how much we had lent, how much risk was involved, when would you get the return and whether there was a loss or profit were all matters for the Overview and Scrutiny Management Committee (OSMC). However, the officer would take away that the Committee would like more detail. It was acknowledged that  ...  view the full minutes text for item 45.

To receive an update on the S106 financial controls audit.

Nic Thomas, Director of Planning and Sally Canter, Head of Building Control and Technical Support presented the service update on the S106 financial controls audit.

The internal audit had looked at how S106 should be applied, how they were recorded, triggers and how they were reported.  The Community Infrastructure Levy (CIL) had not been included in the audit.

This audit built on a 2019 audit looking at the collection of funds, overall results had been positive, but some issues had been identified.

The findings of the internal audit and the actions being taken to address them were detailed in the agenda report.

Additional resources had been allocated and additional training had been given.  The team were committed to reviewing policies and guidance on how monies would be requested, this work was going on in parallel with the Local Plan. The internal audit had picked up on anticipated issues and the team were confident that they could implement the actions to improve.

Members stated that occasionally Wiltshire Council paid S106 monies that were due to town and parish council’s late and did not pass on any interest that would have been accrued whilst holding the funds. This could sometimes amount to large sums and when paying parishes 2 or 3 months late it could have a really big impact on them, sometimes rendering the schemes they had planned unviable. Therefore, it was requested that monies be passed on more quickly.

The officers explained that when transferring funds this was done in line with signed agreements, which could take some time. Legal agreements also had to be in place, and these could also take time. Officers stated that it would be good to have standard agreements to make the process quicker, and they would pick that up with the legal team.

Members expressed concerns about the pressure of S106 agreements on the legal team and wanted to ensure that there were adequate resources in place. Officers agreed that the pressure on the legal team could be an issue and that it was difficult to get suitably qualified solicitors. The agreements also took a long time to negotiate. It was stated that it might be possible to ask for funding to recoup legal costs which could be sued to help bolster the team.

Members also raised concerns regarding ecological offsets and art gain. It was hoped that people could be engaged earlier in the process to ensure that funds were used correctly and to the maximum benefit of the community. Officers stated that the directorate was reviewing the public art strategy and considering how it could be taken forward, although this work was at an early stage in the process. Working out the schemes with the community was essential and they would try to include that in the revised policy. Officers explained that they also wanted to roll out training and engagement for parishes regarding S106 agreements.

Members highlighted that solar farm companies often gave sums of money to parish councils where they  ...  view the full minutes text for item 46.

The Forward Work Plan for the Committee was presented for consideration, and it was,

Resolved:

To note the FWP.

To note that the next regular meeting of the Committee will be held on 22 November 2023.

It was announced that the next regular meeting of the Committee would be held on 22 November 2023 at 10.30am.

There were no urgent items.