The report of the Deputy Chief Executive andCity Treasurer and the Head of Audit and Risk Management is enclosed.

The report of the Deputy Chief Executive and City Treasurer / Head of Audit and Risk

Management was submitted. The Committee was advised that the Audit Plan had been developed to be represented with a greater level of assurance over plans to address gaps in staffing resources. It was reported the impact of Covid19 on the work of the Council had resulted in Internal Audit standing down the planned audit activity in order to minimise impact on services and personnel involved in the response. Work had then focussed on audit resource on advice and guidance for the management of urgent changes required to systems and processes and to help deliver new services required as part of the crisis response. Work postponed included actions to progress the service restructure, as management were required to focus fully on the response to the crisis. Other matters arising from the impact of Covid19 related to the procurement of PPE and the logistics of ensuring distribution and work on business rates and grants to help support businesses in Manchester. Other audit work has focused on cores services such as Adults and Children'’ Service and the impact on the Council’s budget position and reductions over the next year.

The Deputy Chief Executive and City Treasurer acknowledged the work of officers in the Internal Audit and Risk Management Team and the additional time spent in supporting the Council’s work in addressing the impact of Covid19. Reference was made to the Council’s budget and the current process of budget scenarios and budget planning in view of the uncertainty of the future budget position. 

The Chair invited questions from the Committee.

A member referred to the government’s furlough scheme and asked what potential there was for fraud to be committed on support provided by the Council and how this would be identified and addressed. Reference was also made to re-instating safeguards in view of the pace of changes made at the start of Covid19 to ensure that staff are protected in particular through the use of IT systems.

It was reported that changes had been introduced to the process with additional controls put in place to identify fraud and audit officers were involved in consultation during the introduction of the support scheme. This included national reporting on patterns of fraud with monthly reporting to central government. In addition checks are made on spending decisions. Regular updates are also made to the Senior Management Team to highlight the risk of fraud across services. It was reported that safeguards are still in place and reference was made to the IT packages in place such as Microsoft 365 and additional cyber security measures.

A member referred to staffing levels and resources within the Internal Audit Team and the recruitment to the current structure to ensure audit work continues. Reference was also made to the passing of skills/knowledge to other non-audit staff regarding PPE in the event of a further outbreak to allow audit staff to focus on audit work. Officers were asked for a response on the updating the Audit Plan to ensure this and other actions would take place. Officers were also asked for an updated Risk Register to be submitted to the Committee to address risk within Children’s Services and Adult Services.

It was reported the current staff resource position is a key priority and will be taken forward in consultation with Human Resources. Meetings would be taking place to examine the reallocation of responsibility to other non-audit staff in respect of PPE. Recruitment of additional audit staff would take place during the year and the Audit plan will be updated during August and submitted to the Audit Committee. It was reported that the Risk Register would be realigned to identify risks in core services (Children’s Services and Adult Services).

A member referred to achieving best value and asked officers how plans will be been amended in areas such as procurement, contract management and capital expenditure in view of future resource constraints for projects such as the Town Hall improvement scheme and the Waste Management Services Contract. The point was made that the financial stability of care homes is an additional risk to consider and what measures are in place.

It was reported that large contracts such as areas of health and social care is key focus and would be factored into planning, contract management and procurement. Other large schemes included the New Civic Quarter and the Northern Gateway would be included in the future planning. Assurance mapping would also be involved in consideration of providers and the transition arrangements for exiting form the EU. With reference to care home stability it was reported that daily calls were made during the Covid19 crisis with those providers.

A member expressed concern on the inspections made on the properties provided for homeless adults and children. It was reported that assurances would be sought from the Director of Homelessness on the Council’s statutory provision for the inspection of properties.

Decision

To approve the Annual Internal Audit Plan for 2020/21 subject to the comments received.