The Audit and Governance Committee of Newham Council met on Wednesday 16 October 2024 to review the Council's financial performance, risk management, and internal audit activities. Key discussions included the annual complaints report, performance development scheme appraisals, mandatory training updates, and the significant challenges faced in the local audit system. The committee also reviewed the Council's financial statements for 2022/23 and received an update on the 2023/24 accounts, noting the ongoing delays in external audits due to national issues.

The committee received a quarterly report on contract waivers, noting ten waivers granted between April and September 2024, with a total value of £2.5 million. A significant portion of these waivers related to single suppliers or emergencies. The annual complaints report for 2023-24 indicated a slight increase in demand, with housing repairs remaining the most common area of complaint. While corporate Stage 1 complaints were met within timescales, Stage 2 performance saw a decline. The Council is implementing a new casework management system, Microsoft Dynamics, to improve data integration and performance insights.

Discussions also covered the Performance Development Scheme (appraisals), with a reported completion rate of 78% for 2023/24, an improvement from previous years. However, concerns were raised about the low completion rate in the Marketing department, prompting a request for a further briefing. The committee also addressed the issue of toxic management, with officers and the Chief Executive outlining commitments to work with unions to create safer spaces for staff to raise concerns and to improve manager performance. Mandatory training completion rates have improved, with a reduction in the number of courses required, but the overall rate of 43.9% is still considered low, prompting plans for further initiatives to increase compliance.

Internal audit reports highlighted limited assurance for two primary schools, Park and Salisbury, with findings related to governance, purchasing, and HR. The committee was also updated on the progress of counter fraud activities, including the recovery of 15 properties due to unlawful subletting, and council tax investigations that identified £576,179.41 in underpaid tax. The risk management update revealed ongoing risks in cyber security, GDPR compliance, and the management of temporary accommodation, with plans to address these through improved governance and resource allocation.

A significant portion of the meeting was dedicated to the Council's financial position. The savings delivery programme reported that 84% of the £32 million savings target for 2024/25 had been met, with £1.7 million identified as non-delivered. Concerns were raised about the Council's reliance on reserves to cover budget overspends, particularly in temporary accommodation and children's services, and the need for a more robust three-year Medium-Term Financial Plan. The committee also received an update on the local audit backlog, noting that EY would be issuing a disclaimed audit opinion for the 2022/23 accounts due to national issues and a lack of sufficient audit evidence. Similar challenges are anticipated for the 2023/24 accounts, with a focus on rebuilding assurance over multiple years. The committee approved the final Annual Governance Statement for 2022/23 and delegated authority to the Chair and S151 Officer to approve the statement of accounts once EY completed their work. Finally, the committee noted the year-ahead forward plan, agreeing to add the Regulator of Social Housing report for future discussion.