Agenda item

The Committee considered a report on progress made by the Council’s internal audit manager (KPMG) on their internal audit plan for 2022-23 for the period April to October 2022, which included a summary of the work that they had concluded since the previous report to Committee and what they had planned to do ahead of the next. 

The report also reviewed:

(a)   the design and effectiveness of the complaints handling processes and controls.  KPMG had provided ‘partial assurance with improvements required’ (amber/red rating) in that regard; and

(b)   processes and controls around payroll and had provided ‘significant assurance with minor improvement opportunities’ (amber/green rating) in that regard.

In debating this item, the Committee raised the following points:

·       In response to a question as to whether complainants in respect of unresolved outstanding complaints were kept up to date with progress at regular intervals, the Strategic Director: Transformation and Governance confirmed that they were, especially where it was anticipated that there would be a delay in responding.

·       Concerns over one complaint being outstanding for over a year, and the poor performance for meeting the target for initial acknowledgement of complaints. It was suggested that a considerably shorter target timescale than March 2023 should be set to improve complaints handling.  It was acknowledged that the customer service team had gone through a major transformation and would become more resilient over time, and ultimately provide a better service.  It was also accepted that some of these complaints were particularly complex often requiring input from several departments, or external bodies. It was anticipated that improvements would be in place before the end of March 2023.

·       The Joint Chief Executive confirmed that the whole approach around customer service and customer engagement would be a top priority for the new Joint Management Team, which was now in place.

·       The Chairman requested that a more detailed breakdown of the action to be taken within the management action plan to improve complaint handing be circulated to the Committee.

·       The auditor’s rating for Financial Controls: Payroll of ‘significant assurance with minor improvement opportunities’ was queried given the impact on the overall budget of the salary budget discrepancy that had recently come to light following Future Guildford.  The internal auditors commented that the scope of their financial controls review on payroll was around looking at processes and controls and did not extend to looking at the budget variance mentioned.  It would, however, be in scope for the forthcoming budgetary controls review.

·       In response to a question as to whether the 25 sampled complaints were representative of the overall number and type of complaints received, the internal auditor confirmed that they were; and also, whether, within the 25 sampled complaints, there was any trend showing a greater number of complaints regarding particular services, the Committee was informed that there was no such trend.  The Chairman requested that details of the 25 sampled complaints be circulated to the Committee.

·       The Joint Chief Executive suggested that rather than focusing on the 25 sampled complaints, there needed to be a more comprehensive discussion, probably as part of the performance monitoring process, around customer service and complaints handling in the round using a wider range of more meaningful statistics.

·       In response to a question as to whether, in light of management's forecast rating of assurance for both areas had been amber-red and that it appeared that management was already aware of shortcomings in both areas, any remedial action was already in hand at the time of the audit, the Joint Strategic Director: Transformation and Governance, confirmed that, within the areas identified some improvements were being put in place. The Joint Chief Executive confirmed that internal audit works very closely with management in determining what should be in the audit plan and the main purpose of internal audit was to help management discover root causes of problems and to identify potential solutions to them.

·       It was suggested that Overview and Scrutiny Committee may wish to focus on, as part of the performance monitoring process, the more qualitative performance indicators.  The Chairman suggested that the Committee asks the Corporate Management Board to consider adding a new KPI to the Performance Monitoring Report to Overview and Scrutiny Committee on complaint handling and the time taken to resolve complaints.

·       It was also suggested that the Corporate Management Board be requested to bring a brief update to the Committee at its March 2023 meeting, so that it could receive assurance that the agreed management actions were being carried out.

·       In response to the Chairman’s comments regarding the Council’s poor performance in responding promptly to complaints and general enquiries and a question as to why it had taken until this audit review for the scale of the problem to be recognised and reported to councillors, the Committee were reminded that management had already put in place remedial measures to address the issues, for example in dealing with the large increase in the submission of planning applications, and improving training for the customer services team.  It was accepted that there should have been better reporting to councillors of the scale of the problem across all the Council’s services.

·       In response to a question on the internal auditor’s finding in relation to payroll, in particular that there were “no formal policies or procedures outlining roles and responsibilities of officers across HR, payroll and resources”, the internal auditor clarified that they had found that the experience and skills of the relevant officers were extensive and that they were aware of the procedures to follow and the majority of their testing reflected that those processes were well known and well embedded. However, it was the lack of formal documentation of those processes that the internal auditor had highlighted.

The Committee

RESOLVED: That the Internal Audit Progress Report (April to October 2022), attached as Appendix 1 to the report submitted to the Committee, together with the key findings from the reviews undertaken since the last report to the Committee, be noted.

Reason:

To ensure good governance arrangements and internal control by undertaking an adequate level of audit coverage.