1

Introduction and scope of responsibility

1.1

Hampshire Fire and Rescue Authority must ensure that its business is conducted in accordance with the law and proper standards; and that public money is safeguarded and properly accounted for, used economically, efficiently and effectively. The Authority also has a duty (under the Local Government Act 1999) to make arrangements to secure continuous improvement in the way in which its functions are exercised.

1.2

The Authority must also ensure that there is a robust framework of corporate governance and a sound system of internal control that supports the effective exercise of the Authority's statutory functions - including arrangements for the management of risk.

1.3

In accordance with the requirements of the Accounts and Audit Regulations, this Annual Governance Statement (AGS) sets out how the Authority has sought to satisfy these requirements during 2008/09. The AGS subsumes the previous requirement to publish a Statement of Internal Control (SIC). The AGS is far wider in its scope and reports on the effectiveness of all aspects of the Authority's corporate governance arrangements.

2

Assessment against the six core principles of good corporate governance

This is the second time that the new-style Statement has been produced. It has been prepared in accordance with guidance issued by the Chartered Institute of Public Finance and Accountancy (CIPFA). It is based on the outcomes of a detailed review of governance arrangements carried out in 2008. The review used a comprehensive self-assessment matrix. The matrix - presented to the Governance Committee at it meeting on 26 June 2008 - is available on our website (details given in the background information of the covering report). It provides supporting details about the sources of evidence of assurance. The outcomes of the assessment are summarised in the following paragraphs. Overall, it is considered that the Authority has in place robust and effective arrangements for ensuring good governance. However, there is scope for improvement. The improvements identified - and the progress taken to implement them is summarised in paragraph 3.1 below.

2.1

Focusing on the purpose of the Authority and on outcomes for the community and creating and implementing a vision for the local area

2.1.2

As a single-purpose authority the Authority's statutory obligations are generally very clear and these are primarily set out in the Fire and Rescue Services Act 2004. The Authority has a constitution, originally adopted with effect from 1 April 1997. It is based on the provisions of Statutory Instrument 1996 No 2923 `The Hampshire Fire Services (Combination Scheme) Order 1996'.

2.1.3

Key aims and objectives are set out in the corporate `Hampshire Fire and Rescue Plan'. This incorporates the requirement to publish an Integrated Risk Management Plan (IRMP). This is the Authority's primary strategic and corporate plan. It covers a rolling three-year period and is rigorously reviewed and refreshed annually. The current issue [covering 2009 to 2012] sets out for the benefit of all our stakeholders corporate priorities, objectives and other actions that the Authority will take. It shows how the Authority will respond to changes and challenges, identifies common aims with its partner organisations and sets priorities and targets for improvement. As part of this process we review annually the impact of the external environment in which we operate - identifying any new or emerging issues under our `STEEPLE' analysis (i.e. examining the external environment from the perspectives of `Social', `Technological', `Economic', `Environmental', `Political', `Legal', and `Ethical' factors). We have a comprehensive programme of consultation with our various stakeholders to ensure that our plans take account of their needs and any specific input they have made as well consulting them widely for views on our proposed actions.

2.1.4

The corporate plan is approved by the full Authority at its February meeting when, significantly, the three-year revenue budget and capital programme is also determined and approved. Because it is comprehensively reviewed each year, it takes fully into account the outcomes of: a comprehensive programme of consultation with stakeholders; performance results; the findings and recommendations of various reviews audits and assessments; and, external factors such as new or emerging local and national policies, expectations and initiatives. It is supplemented by a number of medium-term functional or business plans which support and complement the various actions and activities. Group- and Station-based action plans are also significant to the planning process to ensure what we do is right for local communities. Our `Strengths, Weaknesses, Opportunities, Threats' (SWOT) analysis is reviewed annually and amended to take account of any new or emerging issues that have been highlighted during the previous 12 months. This thorough review exercise is considered essential if our Plan is to remain dynamic and responsive to changing needs.

2.1.5

The Plan is available on the Authority's website together with current information on actual performance against targets. It is also published in hard copy for circulation to key partners and staff. The Plan is supported by promotional activities and campaigns to ensure that the Authority's corporate aims and targets provide a cornerstone for all internal and external communication activities. Our Plan for 2009 to 2012 has awarded a `Crystal Mark' by the Plain English Campaign. This confirms our commitment to making it an accessible document.

2.1.6

The Plan sets out an ambitious programme of improvements in the way we deliver front-line services. Some of the actions involve conducting trials/pilot schemes during which we will further consult with the local community, key stakeholders and our staff to ensure that our proposals are sound and that we can be confident that they will deliver the anticipated improvements in service.

2.1.7

The Authority's revised staff appraisal arrangements (Personal Development Review System) continue to ensure that all personnel are fully aware and engaged in helping to achieve the Authority's corporate aims. All the Authority's plans are integrated and monitored as part of the Authority's well-established corporate planning process and performance management framework which has been in place since 2000. The improved appraisal system ensures that all our staff are fully aware of the Authority's corporate aims and, importantly, what contribution is expected from them in delivering the related strategies, actions and activities.

2.1.8

Effective performance management processes are in place to measure progress against objectives and to provide for remedial action where appropriate. The Authority has a good track record of monitoring its performance via the Performance Review and Scrutiny Committee. All performance indicators, both national and local, are clearly set out on the Authority's website and responsibility for monitoring each indicator is allocated to a member of the Service Management Team. Significant progress has been made over the last three years in strengthening performance management - notably in the continued development and roll-out to managers (at all levels) of `Views' (our performance management information system).

2.1.9

The financial management of the Authority is overseen by the Treasurer (who also fulfils the `Section 151' officer role for the Authority) in conjunction with the Chief Officer. Financial planning and management is fully integrated with, and driven by, the corporate planning and monitoring processes set out above. This includes processes for the forward planning of expenditure, consultation on budget proposals, setting and monitoring income and budgets, and completion of final accounts. All are intended to be accurate, informative, timely and within statutory requirements. The Authority's Budget Book, which is available on our website, is summarised in the joint (multi-authority) council tax leaflet.

2.2

Members and officers working together to achieve a common purpose with clearly defined functions and roles

2.2.1

The Constitution is supplemented by a set of Standing Orders, Codes of Conduct for members and officers, and a Protocol for member/officer relations. The Authority has a set of Financial Regulations and Scheme of Delegation to Officers (both of which were significantly updated in 2004/05 and the Scheme of Delegation was amended in respect of handling minor estates matters in 2007). In addition, the Service maintains a comprehensive set of `Service Orders' setting out policies and procedures across a wide range of front-line services and support functions.

2.2.2

The role of Monitoring Officer is combined with that of Clerk. Working together with the Authority's Internal Auditor, effective working relationships have been established with both the Standards Committee and Governance Committee. The Standards Committee has responsibility for maintaining high standards of probity amongst members through the provision of advice and training and by carrying out investigations referred to it by the Standards Board. The Governance Committee is responsible for monitoring, reviewing and reporting to the Authority the governance arrangements. The Treasurer is the Authority's designated Section 151 Officer. There are distinct advantages in having the roles of `Monitoring Officer' and `Section 151 Officer' performed by the Clerk and Treasurer who are not part of the Service's `paid workforce'. It reduces the risk of potential conflicts of interest when the Service's senior officers are involved in external collaborative roles with other organisations.

2.2.3

The Corporate Management Team (CMT) - a regular joint meeting of leading Members of the Authority and the Directors - provides a valuable `sounding board' for members and officers to exchange ideas and discuss current issues. It is not, however, a decision-making body. It also plays an important role in reviewing the detail of both the Strategic Risk Register and Improvement Planning Register.

2.2.4

The Authority, its standing committees and the Chief Officer have available to them a full range of professional advisers to enable them to carry out their functions effectively and in compliance with statutory requirements. Legal and financial services are provided through contracts for services (service level agreements) with Hampshire County Council. These are supplemented by specialist legal advice (mainly for specific fire and rescue activities and occasional employment advice) by other external providers. The External Auditor is satisfied with the Authority's arrangements (Annual Audit Letter 2004/05) and is aware of the actions taken following a major best value review to strengthen the day-to-day management of them.

2.3

Promoting values for the Authority and demonstrating the values of good governance through upholding high standards of conduct and behaviour

2.3.1

The Authority operates in an open and transparent way. All its decisions are recorded and made available on our website. There are a well-established set of core values and ethical standards which members and staff are expected to observe and promote. These values are underpinned by policies and procedures covering:

· Members and Officers Codes of Conduct

· Member/Officer relationship protocol

· Equality and diversity strategy and action plan

· Complaints procedure

· Reporting concerns at work (whistle-blowing policy)

· Anti-fraud and corruption policy

· Standing Orders governing the conduct of Authority business

· Financial Regulations

· Standing Orders relating to contracts

· Guidance (toolkit) on managing partnerships

· Performance management system

· Personal Development Review (appraisal) System

2.3.2

An effective Standards Committee is in force, which in the coming year, will take on responsibility from the Standards Board for England for the initial filtering of any complains made against Authority Members. In the year 2008/2009 no complaints against any Members required investigation either by the Standards Board or the Standards Committee.

2.3.3

Advice is available to members from the Clerk on any aspects of the Members Code of Conduct or conflicts of interest that may arise either before or in most cases at the point where the decision is to be made.

2.4

Taking informed and transparent decisions which are subject to effective scrutiny and managing risk

2.4.1

The Authority has a comprehensive Risk Management Policy and maintains a dynamic Strategic Risk Register. The Register is subjected to continual review which includes a quarterly review by the Service Management Team and twice-yearly review by the Corporate Management Team. The Register is presented annually to the Authority (in September) with any major changes highlighted. Reviews of Register are also regarded as a valuable part of our corporate planning process and helps us to prioritise actions in our corporate plan (and supporting plans).

2.4.2

The Authority's Performance Review and Scrutiny Committee (PR&SC) has particular responsibility for overseeing service improvement planning and reporting on performance. It monitors progress on implementing the outcomes and recommendations of best value reviews. The Committee took on responsibility for the scrutiny function in 2008 and, with its wider terms of reference, now has the authority to request post-implementation reviews of major projects and decisions. The Governance Committee has taken responsibility (from the PR&SC) for monitoring progress on the implementation of all agreed audit recommendations. The Governance Committee (established in 2004) receives both internal and external audit plans and annual reports/management letters.

2.4.3

External audit (conducted by the Audit Commission) provides a further source of assurance by reviewing and reporting upon the Authority's internal control processes and any other matters relevant to their statutory functions and codes of practice. The Audit Commission's Annual Audit and Inspection Letter was presented and considered by the Governance Committee at its meeting on 25 March 2009. It included a summary of the outcomes of the Use of Resources and Direction of Travel assessments. It was a very positive and encouraging Letter with the following opening statement:

"Hampshire Fire and Rescue Authority performs well. It is providing good value for money and is delivering services that both reflect the needs of its local communities and complies with national standards. The Authority works well with local people and is building knowledge through local networks and with partners to target those areas and communities most vulnerable, and so reduce risk. It understands where its performance needs improvement and has the ability, capacity, and confidence to make the necessary change.

For the third year running the Authority attained the top category score of `4' for the way we deliver our services to the public and are considered to be `performing strongly'. In the use of resources assessment, we were judged to be `performing well' with a score of `3'. In our overall direction of travel, we were considered to be `improving strongly' with a score of `4'.

No concerns were raised about financial governance arrangements with the auditors commenting:

"... The financial statements submitted for audit were complete, included the annual governance statement, and were supported by sound working papers ..."

2.4.4

Effective, efficient and responsive systems of financial management are in place. The Authority's three-year financial management strategy is reviewed annually and incorporated in the Budget Book. The budget is monitored during the year at meetings of the Finance and General Purposes Committee. The Final Accounts report is reported to the Committee or to the full Authority at the June/July meetings. Procedures have been reviewed to ensure that the timetable for earlier completion of Final Accounts is achieved. The Property Management Strategy was approved in 2007 and this has subsequently been enhanced by the inclusion of a detailed property register. Work is underway to see if the updating of the register can be streamlined.

2.4.5

The Authority has a well-established Health and Safety Policy (Service Order 8/1/1) which has been communicated widely to its staff. Comprehensive information and advice is available on our website. The Health and Safety Executive commenced a comprehensive assessment of our policies and practices on 19 May 2009. The outcomes of this assessment will be considered as part of the 2009/10 review of governance arrangements.

2.5

Developing the capacity and capability of members and officers to be effective

2.5.1

Members receive good induction training and a number of `awareness' sessions on current topics are delivered during the year. These help to ensure that decision-making is based on good knowledge and understanding of the issues involved. Regular bulletins (Members' Updates) are issued and members also receive copies of key internal staff communications (e.g. `Extra's). The 25 Members are appointed to the various standing committees with the aim of spreading workloads and matching individual interests/expertise to the functions of the committees wherever possible.

2.5.2

In the Annual Audit and Inspection Letter (March 2009) the auditors commented:

"... Ethical governance arrangements are developing well. Members receive good and appropriate levels of financial and performance information and provide good levels of scrutiny and evaluation. They understand the objectives of the service and the wider environment in which they work. The Authority has been prepared to make difficult decisions around station closures and has delivered efficiencies with no deterioration to service delivery."

2.5.3

Significant investment continues to be made in delivering training and development needs. The progress made in this area was been formally recognised by the achievement (in 2007/08) of the new, higher standard, Investors in People (IiP) accreditation.

2.6

Engaging with local people and other stakeholders to ensure robust public accountability

2.6.1

Details given in section 2.1 (above) demonstrates that the Authority is very committed to engaging with the public and other stakeholders. Each year an extensive and tailored programme of consultation activities is undertaken (as part of our corporate planning process) to gather feedback on new policies and proposals. We have been particularly keen to engage with harder-to-reach sections of local communities as part of our equality and diversity strategy and action plan. We provide opportunities (via focus groups and website based questionnaires) for stakeholders (including our staff) to suggest actions we might take to better meet our corporate aims and other priorities.

2.6.2

We have significantly improved our external and internal communications both through publications and use of our website. Last year we recognised, that we could do more to actively promote those documents and procedures that help to improve our governance and scrutiny arrangements. We will continue to promote more frequently our complaints procedure, whistle-blowing policy, and performance information. We have decided to produce an annual report which - apart from providing performance data - will take the form of a `self-assessment' of 2008/09.

3

Actions we have taken for improving our governance arrangements

3.1

Based on the self-assessment carried out in 2008, the following list summarises the progress we have made on the key actions we said we would take to improve our governance arrangements and improve our levels of accountability to all our stakeholders.

· We use the good governance self-assessment matrix as a dynamic document to check and record progress and assess compliance against the six principles of good corporate governance.

· We are better at promoting the key corporate governance policies and procedures (especially on our website).

· We have strengthened our processes for evaluating the outcomes and success of major projects and other actions. In the last year we have taken a number of post-implementation evaluation reviews to the Performance Review and Scrutiny Committee.

· We take the opportunity to deliver member awareness/training sessions at, or immediately following meetings of the Authority HFRA and its committees.

· We share good practice with other fire and rescue authorities. In 2008/09 we teamed-up with Buckinghamshire; West Midlands; Humberside; Lancashire fire and rescue services.

· We report more frequently on the effectiveness of partnership arrangements; e.g. our successful and expanded Co-responder Scheme with South Central Ambulance Service.

· We actively participate in the fire and rescue services' Performance Improvement Network and Family Group Four to review and develop comparative performance indicators.

· We have committed to producing an annual report for 2008/09 (to be published in July 2009.

· Our environmental strategy/action is being developed as an outcome of our two-year best value review of our environmental impact (anticipated completion is December 2009).

· We are enhancing the quality of reports to HFRA and its committees. The Authority is now a Corporate Life Member of the Plain English Campaign, and we are revising our report templates.

· We are committed to provide more frequent training to our managers on financial regulations and related procurement procedures in 2009/10, and we piloting devolved budgets in the Southampton Group

· We now produce a more accessible `executive summary' of our strategic risk register.