The Mountsett Crematorium Joint Committee met to discuss the annual external audit, a performance and operational report, and a budget strategy report. Also on the agenda was the approval of an internal audit charter and the provision of internal audit services for 2026-29. Councillors were also scheduled to review the risk register and financial monitoring report.

Budget Strategy

The committee was scheduled to discuss a Budget Strategy Report that outlined issues for medium-term financial planning. Since local government reorganisation in 2009, over £4.3 million had been invested in the Mountsett Crematorium, with over £2 million more planned in the coming years, in line with the Service Asset Management Plan (SAMP).

The report stated that fees and charges, harmonised with Central Durham Crematorium, were £975, and a proposed £50 increase in 2026/27 to £1,025 would still be below the regional average of £1,066. The report noted that should the 2026/27 cremation fees be increased by £50, and assuming a forecast of 1,300 cremations, an additional £65,000 income could be generated. The report also noted that members may wish to consider keeping the fees for direct cremations and early discounted slots the same as current levels to reduce the cost of living impact on service users.

The report assumed that the current surplus distribution to partner authorities would remain at the current level. The report stated that a robust medium-term budget forecast had been produced, demonstrating that, subject to agreement of the fee increase, the reserve balances were projected to be sufficient to meet the liabilities and commitments of the Joint Committee.

Internal Audit Services

The committee was scheduled to consider a report regarding the Provision of Internal Audit Services 2026-29. A three-year service level agreement (SLA) was proposed, covering 2026/27 to 2028/29. The proposed SLA, covering internal audit, risk management, corporate fraud and insurance services, was attached as an appendix. The proposed annual plan of work to be carried out under this agreement, reflecting the same level of service as currently supplied, was set out in Schedule B of the SLA. The annual fee for each of the three years was also shown in Schedule B. The SLA was supplemented by a detailed Internal Audit Charter, which sets out the terms of reference and audit strategy for how the internal audit service is to be delivered.

Performance and Operational Matters

The committee was scheduled to receive an update on performance and operational matters at the crematorium. Between 1 June 2025 to 31 August 2025, 331 cremations were undertaken, compared to 303 in the same period last year. The profile of where families came from was:

• Gateshead 81
• Durham 171
• Outside Area 79
• Total 331

The number and value of memorials sold in the same period was 26 / £6,368, compared to 27 / £5,006 last year.

The committee was also scheduled to note the updated position with regards to the Green Flag scheme¹. The Service Asset Management Plan (SAMP) was presented to Members on 27 September 2024 and has been reviewed and updated to provide further direction and highlight future budget pressures for the Joint Committee. The SAMP is split into four priorities of maintenance need and includes all of the completed and planned crematorium improvement works.

Priority 1 essential works for 2026/27 have been estimated to the sum of £439,570. These will need to be considered as part of the budget setting process for next year. These works include:

• Carry out re-lining of 1 hearth
• Installation of 3 additional small memorial towers
• Replacement of cremator charger
• Re-decoration works
• Install nitrogen oxide monitoring equipment
• Replacement of cremulator
• Replacement of pathway to floral tribute area
• Carry out extension works to monthly ashes plots
• Carry out stonework cleaning to building

Priority 2 works, which will need to feature in 2027/28 budget plans have been estimated to the sum of £180,600 and the works are set out below:

• Carry out re-lining of 1 hearth
• Carry out re-lining of 2 cremators x 1 occasion.

Priority 3 works, which would fall beyond the next two years, have been estimated to the sum of £440,400 and the works are set out below:

• Re-decoration works
• Installation of resomator[^3] [^3]: Water cremation is the new, greener, alternative to flame cremation and burial.
• Carry out re-lining of 1 hearth

Longer term works have been costed to the sum of £950,000 and some of the works include:

• Installation of resomator
• Carry out re-lining of 2 hearths x 6 occasions.
• Re-decoration Works x 6
• Carry out replacement of cooler cassettes
• Carry out re-lining of 2 cremators x 1 occasion.

Financial Monitoring

The committee was scheduled to discuss the Financial Monitoring Report for the period April to August 2025, and the projected outturn at 31 March 2026. The projected revenue outturn was a surplus of £499,364 against a budgeted surplus of £420,132, which is £79,232 more than the budgeted position. Contributions to earmarked reserves are forecast as £79,232 more than originally budgeted. In line with the Mountsett Crematorium Joint Committee Reserve Policy to maintain a General Reserve of 30% of the income budget, a transfer to the General Reserve of £16,296 is required. This is partly offset by a contribution from the revenue surplus of (£134,364), resulting in a net transfer to the Cremator Replacement Reserve of (£118,068). The retained reserves of the Mountsett Crematorium Joint Committee at 31 March 2025 are forecast to be £595,305 along with a General Reserve of £405,380, giving a forecast total reserves and balances position of £1,000,685 at the year end.

Risk Register

The committee was scheduled to be informed of the outcome of the half-yearly risk review in September 2025. A service risk register and a health and safety risk register are maintained in accordance with Durham County Council's methodology and approach to risk management. Since the previous review, there were no significant changes to report, but one minor update was included: The number of Relief Cremation Attendants / Standby Cremator Operators has been reduced from 4 to 3. The net evaluation of each risk remains within the risk appetite.

Internal Audit Charter

The committee was scheduled to consider a report to seek agreement on the Internal Audit Charter to be applied to reviews undertaken as part of the Internal Audit plan for 2025/26. The Internal Audit Charter defines the Internal Audit Service's purpose, authority and responsibility. It establishes Internal Audit's position within the organisation, including the nature of the Chief Internal Auditor and Corporate Fraud Manager's functional reporting relationship with the Joint Committee; authorises access to records, personnel and physical properties relevant to the performance of engagements; and defines the scope of internal audit activities. As a result of the introduction of the Global Internal Audit Standards (GIAS) in the UK Public Sector and CIPFA's new Code of Practice for the Governance of Internal Audit in UK local Government, which came into force in April 2025 and replaced the PSIAS, on this occasion a new Internal Audit Charter has been written.

Annual Review of Internal Audit

The committee was scheduled to be advised of a review of the effectiveness of the Durham County Council Internal Audit Service, which was carried out by the County Council's Audit Committee in June 2025. In April 2013, the Public Sector Internal Audit Standards (PSIAS) became effective. The standards apply to Internal Audit in all parts of the public sector in the UK and are mandatory. The standards are intended to reflect that a professional, independent and objective internal audit service is one of the key elements of good governance . The standards were revised from 01 April 2017 and it is these standards that Internal Audit works to. The Durham County Council Audit Committee considered a report presented by the Chief Internal Auditor and Corporate Fraud Manager that provided evidence on the effectiveness of the service during 2024/25. It is a requirement for the service to be externally assessed once every five years. The latest external assessment, carried out by the Chartered Institute of Public and Finance and Accountancy (CIPFA), in February 2022, concluded that 'Durham County Council's Internal Audit Service's self-assessment is accurate and as such we conclude that they FULLY CONFORM to the requirements of the Public Sector Internal Audit Standards and the CIPFA Local Government Application Note'. Internal Audit then completed a further self-assessment, for 2024/25, against the key elements of the Public Sector Internal Audit Standards (PSIAS) and CIPFA Local Government Application Note, which demonstrated that the Section continues to conform to the Code's requirements and was based on the revised PSIAS brought into effect on 1 April 2017.

External Audit Annual Review

The Joint Committee was scheduled to receive the External Auditors (Mazars LLP) Annual Review of the Joint Committees Return for the year ended 31 March 2025. In July 2025 the Joint Committees Annual Return for the year ended 31 March 2025 was submitted to Mazars LLP for audit under the limited assurance audit regime. The audit has been completed and has not highlighted any material weaknesses around the Joint Committees system of internal control and accounting statements and reports no exceptions to the Return.