Archived decisions

Contact: Jenny Heath, Ext. 7402

1. Summary

1.1 This report highlights the main findings contained in the District Auditor's Management Letter in relation to the audit of accounts for 2001/02, the financial aspects of corporate governance and performance management.

1.2 The overall conclusion of the Management Letter is that the County Council has continued to deliver high quality services in priority areas, has achieved high levels of public satisfaction with performance and has been categorised as excellent as a result of the Comprehensive Performance Assessment process.

1.3 The report also indicates areas where the Auditor considers that further action needs to be taken including a response to the statutory recommendation in respect of the County Council's processes for collecting and reporting on performance indicator data.

1.4 A copy of the full letter has been sent to all members of the Council.

1 Introduction

1.1 The District Auditor has published his annual Management Letter to the Members of the Council summarising the conclusions from this years combined audit and inspection regime and progress on the Citizen Focus Audit pilot. The Management Letter also confirms that the future programme for combined audit and inspection will be presented in one 17 month plan covering the period 1 November 2002 to 31 March 2003 and 1 April 2003 to 31 March 2004.

2 Overall Conclusion

2.1 Against the background of an extremely demanding year with continuing financial pressures and increasing demands on services, the Council has responded positively to a series of major national initiatives and local challenges including the revision of the Corporate Strategy, the Public Service

Agreement and new arrangements for Recreation and Heritage and Highways.

2.2 The Auditor further recognises that the Council has continued to deliver high quality services in priority areas and has achieved a high level of public satisfaction with performance. The Council's categorisation as excellent under the Comprehensive Performance Assessment process for the way in which it serves local people is supported by effective and well established building blocks to ensure future improvement.

2.3 Against this background, the Auditor identified a small number of areas where the council could take further action and these are highlighted in Paragraph 4 below.

3 Key messages

3.1 Cross cutting Best Value reviews
The Auditor noted several positive features but felt that this type of review needs to be enhanced by strengthening improvement plans, challenging more robustly and ensuring the scoping of reviews covers all aspects and services which contribute to cross cutting themes. The Auditor also invited the Council to identify further inspection work which will help improve cross cutting review outcomes.

3.2 Service planning
The Auditor recognised ongoing work to improve service planning in the council in particular linking to budgets, greater discussion of procurement options and more emphasis on priorities.

3.3 Best Value and Performance
The Council has continued to improve its performance management framework and work is underway to make further refinements. However, in relation to the collection of data for performance indicators, the Auditor felt that little progress had been made. This had lead to the need to give a qualified opinion on the Best Value Performance Plan and a statutory recommendation that `systems to collate, co-ordinate, produce and support published PIs within the Best Value Performance Plan should be strengthened to ensure they are accurately compiled in accordance with relevant guidance and applicable time scales'. This requires formal response within 30 days.

In response CMT have taken a range of management actions to address this issue including:

- production of a confirmed list of nominated responsible operational
managers

- Each to provide a written record of the process for collation for each
relevant BVPI
- Each Chief Officer to provide a written commentary on PIs indicating their
impact on the PSA, Corporate Strategy and Improvement Plan (CPA) as
well as an explanation of significant variations or poor performance by 31
December
- Each nominated operational manager to report on progress during the
current year
- Corporate Performance Team to prepare a reporting timetable for
departments to integrate with corporate reporting timetable. The outcome
will form part of the corporate response on PIs and should be regularly
reported to Department al Management Teams
- Corporate Performance Team to strengthen central support for PI data
collection.

3.4 E-Government
The Council is making good progress towards the Governments target that 100% of dealings with the public should be capable of being delivered electronically by 2005.

3.5 Enterprise project
While much has been done to resolve problems that arose following the implementation of SAP, some problems still remain and Members are urged to ensure that a continued robust approach to benefits realisation for the Enterprise project is adopted in line with the original business plan.

3.6 Hampshire Public Services Network (HPSN)
At the half way stage in the project, the council should conduct a project review to confirm whether the project can still be cost neutral overall or whether any re-alignment of the contract is needed.

3.7 Financial Position
The Council's financial position remains soundly based although spending pressures still exist particularly in relation to a challenging Government grant settlement for 2003/04. Processes have been put in place to address these pressures and members will need to continue to monitor progress at least quarterly. The funding gap in relation to the capital cost of the systems replacement programme needs to be addressed by 31 March 2003.

Accounts
The Auditor has given an unqualified opinion on the Statement of Accounts and is working with officers to improve systems in relation to the proposals to bring forward the deadlines for approval of the Statement of Accounts.

Financial Systems
The Auditor recognises that systems for corporate governance are soundly based but that the implementation of the new financial system has temporarily weakened internal financial control. Key task have been identified to address this concern.

Internal Audit
The Auditor recommends that Members should be involved in approving and commenting on the overall Internal Audit strategy.

3.8 Risk Management
A sound framework for risk management is in place but internal controls need to be tested on a continuing basis.

Recommendations

That the District Auditor's comments be welcomed and that the County
Council addresses those issues highlighted in the Management Letter over the coming year.


That the County Council's response to the statutory recommendation in relation to the collection of data for performance indicators, as detailed in paragraph 4.3, be endorsed.

Background Information

Section 100D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works.

2. Documents which disclose exempt or confidential information as defined in the Act.

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