The Audit and Standards Committee of Staffordshire County Council met on Tuesday 7 July 2026 to review the council's financial health, governance, and operational performance. Key discussions included the external audit plan, health and safety performance, and the internal audit outturn report. The committee considered proposals for approving updated governance codes and recruitment for independent panel members.

External Audit Plan and Strategy Memorandum (2025/26) - Staffordshire County Council

KPMG presented the indicative external audit plan for the 2025/26 financial year, outlining their approach to auditing Staffordshire County Council's financial statements. Richard Lee, the engagement director from KPMG, explained that the audit would focus on significant risks, including the valuation of land and buildings, post-retirement benefit obligations, and management override of controls. Materiality for the financial statements was set at £34 million, with errors reported below £1.7 million. KPMG also confirmed their independence from the council. The audit plan aims to rebuild assurance following previous disclaimed opinions, with a focus on addressing the valuation of property, plant, and equipment, and the reserves position. The earliest a non-disclaimed opinion could be expected is 2027/28. The audit fees are set by the Public Sector Audit Appointments (PSAA) and are not determined by KPMG.

External Audit Plan and Strategy Memorandum (2025/26) - Staffordshire Pension Fund

KPMG also presented the external audit plan for the Staffordshire Pension Fund. Richard Lee highlighted that the materiality for the pension fund's financial statements is significantly higher due to the scale of its assets, set at £84 million. The audit risks for the pension fund primarily focus on the valuation of the investment portfolio, including property and various asset levels, as well as contributions to the fund. KPMG confirmed that their work on the pension fund for 2024/25 was complete and a traditional audit opinion was issued, though its inclusion in the council's report pack caused a delay.

Health, Safety and Wellbeing Performance Annual Report 2025/26

Becky Lee, Head of Health, Safety & Wellbeing, presented the annual report, detailing key achievements and performance data for 2025/26. Significant successes included supporting investigations and emergency response activities, enhancing the WellMe wellbeing strategy with a focus on physical, mental, financial, and social wellbeing, and the continued popularity of the Vivup lifestyle benefits platform. Financial wellbeing products were well-utilised, with over 1,800 employees accessing advice and support. A pilot programme, Together in Practice, was launched for Children and Families social work teams to address vicarious trauma. Occupational health services maintained high Net Promoter Scores, and a Safe & Well pilot was extended across all directorates, demonstrating a significant return on investment by reducing short-term absence.

The report noted a 3% reduction in sickness absence within the core county council compared to the previous year, though it remains higher than the national average. Psychological ill health and musculoskeletal conditions remain the leading causes of absence. Violence and aggression incidents across directorates saw a slight increase, attributed to improved reporting and challenging behaviour placements in children's residential settings. Maintained schools saw consistent accident rates, with a significant decrease in violent incidents. The council has confirmed that 83% of maintained schools and 92% of core council premises have reviewed their fire risk assessments. Key actions for 2026/27 include implementing Martyn's Law, assessing the Together in Practice pilot, and reviewing stress management toolkits in preparation for Local Government Reorganisation (LGR).

Annual Report of the Audit and Standards Committee 2025/26

Lisa Andrews presented the annual report of the Audit and Standards Committee, summarising its work over the past year. The committee met six times, overseeing financial reporting, internal and external audit arrangements, risk management, and governance. The Statement of Accounts for 2024/25 was published, though the audit resulted in a disclaimed opinion. The committee received updates from external auditors KPMG on the audit of both the council's accounts and the Staffordshire Pension Fund. Internal audit work included approving the 2025/26 plan and receiving progress reports, with an Adequate Assurance opinion given on the council's control environment for 2024/25. Counter-fraud work and updates on the National Fraud Initiative were also reviewed. The committee annually reviews the Code of Corporate Governance and the Annual Governance Statement, and received reports on information governance, health and safety, and civil contingencies. An induction workshop was held for committee members to enhance their understanding of their responsibilities.

Internal Audit Outturn Report 2025/26

Lisa Andrews presented the internal audit outturn report for 2025/26, which summarises the work undertaken against the annual plan. The report provides the Chief Executive's opinion on the control environment, risk management, and governance arrangements. An Adequate Assurance opinion was given on the overall control environment. High-risk audits, including those related to digital transformation, cyber security, and SEND, received substantial or adequate assurance. Main financial systems audits also received positive assurance. However, compliance reviews, particularly concerning maintained schools, revealed ongoing issues, with 13 out of 18 schools receiving limited assurance. Special investigations and counter-fraud work identified weaknesses in payment controls, leading to a slight increase in financial losses compared to the previous year, though still low historically. The report noted that 94.4% of Global Internal Audit Standards were in place, with an action plan to address areas of partial conformance.

Code of Corporate Governance 2026

Lisa Andrews presented the updated Code of Corporate Governance for 2026, which outlines the council's framework for ensuring good governance. The code, based on the CIPFA/SOLACE framework, had minimal changes from the previous year. The report detailed the council's adherence to seven core principles of good governance, including behaving with integrity, ensuring openness, defining sustainable outcomes, managing risks, developing capacity, and implementing good practices in transparency and audit. The action plan for 2026 was also presented, with progress to be monitored throughout the year.

Code of Conduct for Members - Report on the Management of Complaints (May 2025 - April 2026)

Kate Loader, County Solicitor and Monitoring Officer, presented the annual report on complaints made against elected members. The report detailed a significant increase in complaints received during the period, from 12 in the previous year to 168. The majority of these complaints (79.8%) related to comments made on social media. A large proportion of complaints (85.7%) were against members of the Reform political group. While 39.3% of complaints were found to have no breach, 8.3% were identified as breaches, and 52.4% were still ongoing. The report highlighted the challenges of managing the increased volume and complexity of complaints, necessitating the use of external investigators. The government's response to its consultation on strengthening the standards framework was also noted, though no specific parliamentary time has been scheduled for legislative changes. The reporting cycle for these complaints will move to a quarterly basis.

Annual Governance Statement 2025/26

Lisa Andrews presented the draft Annual Governance Statement (AGS) for 2025/26. The statement provides an overall assessment of the council's governance framework, informed by internal and external audit opinions, and reviews of various governance arrangements. The internal audit opinion for 2025/26 was Adequate Assurance, with positive findings in areas like digital transformation and cyber security, but ongoing issues in maintained schools' compliance. External audit provided a disclaimed opinion for the 2024/25 financial statements, but no major issues were identified in the value for money opinion. The council's financial resilience was assessed positively, with an underspend of £6.696 million against the budget. Statutory officers confirmed they had not needed to use their powers of intervention. The review of the constitution, governance health checks, and overview and scrutiny arrangements all indicated good governance standards. The statement also highlighted ongoing work to improve risk management arrangements through a new Power App and preparations for Local Government Reorganisation (LGR).

Recruitment of Independent Remuneration Panel Members and Standards Independent Persons

Liam Archer presented a report on the recruitment of independent members for the Independent Remuneration Panel and Standards Independent Persons. Given the approaching Local Government Reorganisation (LGR), the council sought to extend the terms of current appointees and recruit additional members to ensure capacity and resilience. Full Council had previously resolved to re-appoint current Standards Independent Persons and Independent Remuneration Panel Members until LGR, and to recruit at least one additional Standards Independent Person and one additional Independent Remuneration Panel Member. The committee was asked to endorse these recruitment exercises and to establish a special panel of five members to shortlist and interview applicants.

Appointment of Members to the Standards Panel for 2026/27

Liam Archer presented the nominations for the Standards Panel for 2026/27. Following the decision of Full Council on 21 May 2026, the proposed members for the panel are Councillors Thomas Baker, Alex Farrell, Craig Humphreyson, Rhys Machin, and Jon Pendleton. The committee was asked to approve these nominations.

Proposed Changes to the Constitution in respect of Procedural Standing Orders and Councillor Dress Code

Kate Loader, County Solicitor and Monitoring Officer, proposed amendments to the council's constitution, including procedural standing orders and the introduction of a councillor dress code. The proposed changes aim to enhance clarity and consistency in council business. Amendments to procedural standing orders include provisions for the chairperson to ask a member to leave if their conduct disrupts the meeting, the ability for members to request a record of their vote, and clarification on who questions can be addressed to. The proposed dress code suggests smart casual attire for most meetings, with formal attire for civic occasions, and allows for reasonable adjustments and chairperson discretion. The committee was invited to recommend these changes for approval by Full Council.

Vice-Chairperson Overview and Scrutiny Roles

Deb Breedon, Scrutiny and Support Manager, presented proposals to reduce the number of Vice-Chairpersons on Overview and Scrutiny Committees from two to one per committee. This change, arising from a review of the scrutiny function, aims to streamline leadership and achieve an annual efficiency saving of £12,344.48 through the removal of four Special Responsibility Allowances. The decision on who will hold the single Vice-Chairperson role will be made by the Leader of the Council. The committee was asked to endorse this change and refer it to Full Council for approval.

Forward Plan for the Audit and Standards Committee

Lisa Andrews presented the forward plan for the Audit and Standards Committee, outlining upcoming agenda items for the next iterations of the committee. The plan is a working document and will be updated to include any urgent or important issues that arise. The committee was invited to ask any questions regarding the contents of the plan.

The meeting concluded with the exclusion of the public for the remaining items of business, which involved the likely disclosure of exempt information.