The Audit & Governance Committee of Croydon Council met on Thursday 18 July 2024 to review the council's financial performance, transformation plans, and risk management strategies. Key decisions included noting the council's provisional outturn report for 2023-24, which demonstrated a balanced budget, and approving the draft productivity assessment. The committee also reviewed the governance arrangements for the council's transformation initiatives and received updates on revenue and capital monitoring improvements.

Section 24 Statutory Recommendation Report and Productivity Plan

The committee received an update on the council's response to a statutory recommendation from external auditors Grant Thornton, which required the council to demonstrate how the 2023/24 council tax increase was controlled and how value for money arrangements had improved. Jane West, Corporate Director of Resources and Section 151 Officer, introduced the report, highlighting that Croydon Council had managed to balance its budget for 2023/24, a feat achieved by only two other London boroughs. This was attributed to tight budget assurance processes.

Councillor Jason Cummings, Cabinet Member for Finance, noted the difficulty in communicating the council tax rise to residents but emphasised that the report demonstrated the funds were spent efficiently, preventing further cuts to council services. The report also included the council's draft Productivity Assessment, compiled at the request of the former Local Government Minister, Simon Hoare MP, outlining improvements in productivity during 2023-24.

The committee resolved to note the Provisional Outturn Report for 2023-24, the Draft Productivity Assessment, and that these demonstrated the council had met the external auditor's recommendation regarding the control of council tax and improvements in value for money.

Governance of Transformation

Jonathan Ross, Interim Transformation Financial Analyst, provided an overview of the governance arrangements for the council's transformation and improvement strategies. The committee had requested this report to gain assurance on the structures underpinning the council's transformation strategy, particularly the Future Croydon plan and the revised corporate improvement plan.

It was noted that the Croydon renewal plan had been replaced by the Mayor's Business Plan, with any remaining items captured within the Annual Governance Statement (AGS). The Improvement and Assurance Panel (IAP) closely monitored the IAP Exit Strategy, with intervention anticipated to end within the next year. The Corporate Management Team (CMT) actively monitored all improvement and strategic plans, holding dedicated meetings to ensure alignment and identify interdependencies.

Members raised concerns about the complexity and accessibility of reporting for councillors and residents, querying the use of new technology to present progress more clearly. Officers acknowledged the cultural challenges and explained that Future Croydon had been collated under a single banner, with support from three external consultancy firms. The Oracle Improvement programme was highlighted as a key area of work, with new functionalities being introduced quarterly and focused training provided. The committee requested that future reporting include information on the pace and progress of culture change, as well as baseline and benchmarking data against other local authorities.

The committee resolved to note the updated governance arrangements for the delivery of programmes and projects within the corporate improvement plan and the Future Croydon transformation plan.

Revenue & Capital Monitoring Improvements: Updating Report on Progress

Allister Bannin, Deputy Section 151 Officer, introduced the report, noting that recommendations from external reviews by Worth Technical Accounting Solutions (Opening the Books ) and PwC (Capital Framework Improvement Plan ) were now prioritised. Officers agreed to include expected completion dates for recommendations in future reports.

The committee queried the prioritisation terminologies to be progressed and underway, with officers explaining that underway indicated work in progress, while to be progressed meant the recommendation had not yet started, sometimes due to interdependencies with other actions. The 2019/20 annual accounts were anticipated to be completed in the coming weeks, with external auditors progressing the 2020/21 accounts. The 2020/21 annual accounts were expected at the October 2024 committee meeting.

The committee resolved to note the updates on progress against recommendations from both external reviews, including the indication of priority for outstanding actions.

Quarterly Whistleblowing Update

Stephen Lawrence-Orumwense, Monitoring Officer, introduced the report, noting that some paragraphs had been included erroneously. The committee recognised the efforts to improve engagement with the whistleblowing process and queried benchmarking data against comparable local authorities. Officers advised that this data was not yet available but indicated that an average of one whistleblowing case per month suggested good organisational awareness, with three out of five cases relating to staff relations.

The committee questioned whether further work was needed to improve awareness of whistleblowing parameters and ensure correct reporting pathways. Officers confirmed internal communication campaigns and available training, with plans to report to the Statutory Officer's Board and the Finance and Risk Internal Control Board. The Guardian's programme was mentioned as encouraging earlier reporting, with whistleblowing being a last resort.

The committee resolved to note the whistleblowing referrals and outcomes.

Committee Annual Report

Dave Philips, Head of Internal Audit, introduced the draft Committee Annual Report 2023/24. He noted that the report was the committee's document and welcomed any changes or additions from members. The committee would receive the final version for approval at a future meeting. Members discussed the importance of capturing the committee's impact and intended achievements, and agreed to provide contributions within two weeks. Members were also asked to contribute to a self-assessment circulated in May 2024.

Part A - Corporate Risk Register

Malcolm Davies, Head of Insurance, Anti-Fraud and Risk, introduced the report, highlighting the publication of the full Part A Corporate Risk Register as a significant improvement in risk reporting maturity and a step towards greater transparency. The report included a dashboard summary of risks, as requested by the committee, showing their direction of travel.

The committee noted that several risks had remained at red status since October 2023, querying whether this indicated an inability to improve the risk score. Officers advised that some areas, like accounts, were anticipated to improve, while others, such as finance, had ongoing issues, particularly with rising demand. Concerns were raised about risks with inexplicably low future ratings and insufficient control measures. The committee discussed the importance of clearly defined future risk ratings, including target levels and narrative explanations of how these would be achieved. Inconsistencies in how risk owners adopted the framework were also noted. Officers suggested moving towards standardised terminology like inherent, residual, and target risk ratings. The committee requested an overview report on the improvement journey of the council's risk management framework.

The committee resolved to note the contents of the corporate risk register as at July 2024 and to agree which risks would be called in for a deep dive at future meetings.

Part B - Corporate Risk Management

The committee resolved to exclude the press and public from the remainder of the meeting due to the likely disclosure of exempt information.

The meeting concluded at 8:35 pm.