The Audit and Governance Committee of North Northamptonshire Council met on Monday 19 October 2026. The committee noted key findings from reviews of the Staffing Approval Panel and procurement waivers, and received updates on the Auditor's Interim Annual Report and Internal Audit progress.

Impact of the Staffing Approval Panel

The committee noted the key findings of a review into the Impact of the Staffing Approval Panel. This review indicated that the council has significantly strengthened its governance and oversight of agency staffing and consultant commissioning through the implementation of the Staffing Approval Panel and the OPUS Managed Service Provider arrangement. These controls aim to enhance scrutiny, improve transparency, and support value-for-money objectives while maintaining essential service delivery. The panel has been instrumental in reviewing and challenging agency and recruitment requests, with a significant number of requests being approved (89.6%), but also some rejected (2.8%) or requiring further information (7.6%), demonstrating that approvals are not automatic. Agency spend has reduced by £1.5 million (8.6%) from £17.9 million in 2024/25 to £16.4 million in 2025/26, with a forecast reduction to approximately £12.0 million in 2026/27. Long-standing agency arrangements have been challenged, with approvals now limited to a maximum of 12 weeks to ensure regular reassessment of business needs and to encourage a transition to permanent staffing solutions. The council has also seen a reduction in staff turnover and an increase in new starters and the permanent workforce.

Update on Procurement Waivers

The committee noted the key findings from the Quarter 1 and Quarter 2 review of procurement waiver activity. The review indicated that waivers are generally being used for legitimate operational purposes, such as maintaining service continuity, supporting critical operational requirements, addressing urgent situations, and facilitating short-term arrangements while compliant procurement exercises are undertaken. The overall pattern is consistent with a large and complex organisation managing a significant contract portfolio alongside ongoing transformation activity. Recurring themes such as contract planning, late engagement with Procurement, legacy contractual arrangements, and repeat waivers were identified as areas for improvement. However, there is clear evidence of increasing procurement oversight, stronger governance commentary, and a greater emphasis on identifying future compliant procurement routes. The number of waivers approved in Quarter 1 was 39, with a reduction to 22 in Quarter 2, indicating progress in managing procurement compliance risks.

Auditors Interim Annual Report

The committee noted the Interim Annual Audit Report for 2025/26. The report highlighted significant ongoing challenges for the council, particularly in relation to medium-term financial sustainability and the Dedicated Schools Grant (DSG) deficit. Two key recommendations were issued focusing on:

• Medium-term financial sustainability: Addressing the council's medium-term funding gap and continuing cost pressures within Children's Services. The report noted a £13.8 million General Fund overspend for 2025/26, primarily driven by Children's Social Care costs, and a £27.5 million medium-term funding gap.
• Dedicated Schools Grant (DSG) deficit: Managing the deficit and delivering sustainable improvements to SEND services. The cumulative DSG deficit rose to £42.7 million at 31 March 2026.

Three improvement recommendations were also raised concerning procurement waivers and agency staffing controls, the delivery of the Adult Social Care Improvement Plan, and the introduction of a contract management framework with social value monitoring. The auditors acknowledged progress made against previous recommendations, including the closure of a recommendation relating to statutory financial reporting.

Internal Audit Progress Update

The committee noted the Internal Audit Progress Report and the Northamptonshire Children's Trust Annual Internal Audit Report and Opinion for 2025/26. Since the last meeting, five audit reports had been finalised. These included:

• Private Sector Housing (Houses in Multiple Occupation - HMOs): A good level of assurance was given for the control environment and compliance, with one medium-priority recommendation regarding DBS accuracy.
• Anti-Social Behaviour: Moderate assurance was given for the control environment and compliance, with a medium organisational impact, highlighting issues with case record completeness and the lack of procedures for statutory case reviews.
• Flood Authority Statutory Duties: Moderate assurance was given for the control environment and compliance, with a medium organisational impact, noting that key documentation remained in draft.
• Inclusion (Permanent Exclusions): Moderate assurance was given for the control environment, but limited assurance for compliance, with only 20% of tested exclusions having provision in place by the sixth school day.
• Adult Safeguarding Referrals: Good assurance was given for the control environment, and moderate assurance for compliance, with a medium organisational impact, noting that targets for timely assessment were not met.

The committee also noted that 23 actions had been implemented since the last meeting, with 40 actions remaining overdue. The Northamptonshire Children's Trust Annual Internal Audit Report and Opinion for 2025/26 provided reasonable assurance regarding the Trust's framework of governance, risk management, and internal control.