Agenda item

1.      The Interim Corporate Director presented the Audit Risk Assessment. It was confirmed that the principle financial risks would be reflected in the Annual Government Statement.

2.      In response to questions and comments from Members it was said that:

a)    When the Authority disposes of an asset of the organisation, there were various considerations taken into account, such as value for money and the potential to gain the maximum possible capital receipt. The valuation of the asset is recorded as part of the Governance structure.

b)    There was an agreement in place with the Department of Education that in return for undertaking a set of actions they will release a set amount of funds, which the Council is currently on track with and so the funds are being released. This agreement is covered in the Cabinet report. If all actions which could be undertaken, were completed, there would still be a likely deficit of around £220 Million by the end of 2027/28. The arrangement with the Department of Education was that the Council would find up to £80 Million of this from reserves or further reductions. 

c)    The Council is not permitted to subsidise SEND funding beyond the grant the department is currently in receipt of, without the express permission of the Secretary of State. This left two options of either making service reductions or reaching an agreement that repayments can be made over a longer period.

d)    An explanation of high needs deficit was given to all Members by the Interim Corporate Director.

e)    In relation to ASC, in some areas financial saving had been successful, but not in others and consequently these areas had not met the budget during the current financial year. It had been agreed that the department would contract to bring in a third party to assist with bringing the areas not meeting the budgetary target into line, within the current financial year.

f)     The Authority was aware of the impact of inflation and the risks of inflammatory increase going forwards. Over 70% of revenue budget was allocated to Adult Social Services and Children Social Services being the statutory services due to inflation of these budget heads.

g)    Grant Thornton confirmed that they were satisfied with the comprehensive nature of the responses form the Council and recognise some of the challenges reflected in this. 

h)    The position of the Authority’s high level deficit for the current financial year was around £49 Million although the fund paid by the Department of Education needed to be subtracted and therefore this was not an accurate figure. A figure of where the deficit was forecast to be at the end of the year would be provided in due course.

i)     It was explained that there was a specific fraud risk associated with the Libraries, Registration and Archive services as they were more often met with cash payments and so more likely to lend opportunities for fraud.

j)     A statutory duty in one area could result in a breach of a statutory duty in another area, by way of example: Libraries and the 1964 Libraries Act. A discretionary service can also have a statutory basis.

3.      RESOLVED considered and agreed the responses to Grant Thornton.