The Governance, Audit, Risk Management and Standards Committee of Harrow Council met on Tuesday 19 March 2024. The committee reviewed the Council's Corporate Risk Register for the third quarter of the financial year, considered the draft Statement of Accounts for 2022/23, and received updates on the progress of the Internal Audit and Corporate Anti-Fraud Team (CAFT). They also reviewed the refreshed Corporate Anti-Fraud and Corruption Strategy 2022-26, which will be referred to Full Council for approval. Additionally, the committee discussed the Treasury Management Strategy for 2024/25 and granted dispensations to two councillors to speak but not vote on matters relating to the Harrow Strategic Development Partnership (HSDP).

Corporate Risk Register Q3 2023/24

The committee received an update on the Council's Corporate Risk Register for the third quarter of the financial year. It was noted that the register currently lists 15 open risks and one closed risk. Of the open risks, three are rated as 'red', eleven as 'amber', and one as 'green'. No risks had increased in rating during the quarter, while half of the risks had seen their rating reduce in significance. The most significant risks identified were: an overspend in the Adult Social Care budget, the failure to deliver the Council-led Regeneration Programme through the Harrow Strategic Development Partnership (HSDP), and Housing not delivering on health and safety statutory duties and regulatory requirements. The committee was informed that the risk related to the failure to stabilise and optimise the Dynamics Finance and Operations system (Finance and HR/Payroll) is decreasing as the implementation progresses. It was also clarified that closed risks are removed from the Corporate Risk Register but may be monitored elsewhere within the organisation. The committee noted that various programmes have been implemented to enhance staff training, including leadership courses for female staff and targeted training for junior staff. Corporately, staff are required to work across different sites a minimum of two days per week.

2022/23 Draft Statement of Accounts

The committee reviewed the draft Statement of Accounts for 2022/23. The interim Director of Finance and Assurance informed the committee that Harrow was the first of Mazars' London clients to have their 2021/2022 statement of accounts approved. The draft accounts for 2022/23 were published on 24 January 2024, with a public inspection period concluding on 6 March. Members were assured that auditors had made good progress and that the reduction in funding from Central Government had been factored into the Council's Budget. It was clarified that WHE were the external valuers for the Council's assets for the first time this year, and that discussions had been held with them regarding an assumption in the valuations. The committee was informed that the largest provisions for trade debtors related to Business Rates and collection rates. Surplus assets were explained as those not operational for the Council but not classified as investments, with the Civic Centre cited as an example. The external auditors, Mazars, indicated that a timetable was in place to complete their final review processes by the end of September. They identified four significant risks for the 2022/2023 financial statements: management override of controls, valuation of the net defined pension liability, valuation of property, plant and equipment and investment property, and the migration of payroll data. The audit for 2022/2023 is intended to be signed off by the end of September, subject to any unforeseen circumstances. The committee resolved to note the draft 2022/23 Statement of Accounts.

Internal Audit & Corporate Anti Fraud Team (CAFT) Progress Report

The committee received a progress report on the Internal Audit and CAFT's work up to 29 February 2024. Members were informed that 75% of the 2023/24 Internal Audit plan had been achieved, and that 54 recommendations had been made to management to improve internal controls, all of which were agreed for implementation, exceeding the target of 95%. The report also detailed the outcomes of CAFT investigations, which had resulted in estimated savings or avoidance of loss totalling over £1.2 million. The committee noted the progress report.

Corporate Anti-Fraud and Corruption Strategy 2022-26

The committee reviewed the refreshed Corporate Anti-Fraud and Corruption Strategy 2022-26. It was clarified that the Council has the ability to prosecute under the Fraud Act if sufficient evidence of fraud is found. A new addition to the strategy, detailed on page 205 of the report, outlines the five pillars for fighting fraud and corruption locally, including a new pillar focused on protecting the Council and its residents from fraud. The committee reviewed and noted the draft strategy and resolved to refer it to Full Council for approval.

Review of Treasury Management Strategy 2024/25

The committee received a report outlining the Treasury Management Strategy for 2024/25, which had previously been presented to Cabinet. The strategy covers capital issues, borrowing, the annual investment strategy, and other treasury issues. It was noted that due to a rearranged January meeting, this report had gone to Cabinet before GARMS, but the intention is for future reports to be presented to GARMS first. The committee resolved to note the report.

Application for a Dispensation

The committee considered requests for dispensations from Councillors Greek and Rabadia under section 33 of the Localism Act 2011. Both councillors are directors of HSDP Nominee Ltd and receive remuneration for their board membership. They requested permission to stay and speak, but not vote, on decisions relating to HSDP. The committee was informed that allowing them to remain in the meeting to hear discussions and contribute to their board role would be in the interest of the residents of the authority. The committee resolved to grant the dispensation to Councillors Greek and Rabadia to stay in the meeting and speak, but not to vote.