To consider the Internal Audit work undertaken and the assurance given on the adequacy of internal controls operating in the systems audited.

26.1           The report of the Head of Corporate Services, circulated at Pages No. 51-66, provided the Committee with the findings of the individual audit assignments undertaken for the period April to August 2018 along with the status of internal audit recommendations followed-up in quarter two. Members were asked to consider the audit work completed and the assurance given on the adequacy of the internal controls operating in the systems audited.

26.2           The Head of Corporate Services explained that Appendix 1 set out the audit opinion for each individual audit assignment completed. Appendix 2 provided details of previous audit recommendations that had been followed-up and, using a red, amber, green (RAG) system, identified whether the recommendations had been implemented or not. He also clarified that all recommendations which were due for follow-up had been followed-up. The information had been provided in a new format which had been developed following a discussion with Members via a Member workshop; it was felt the Internal Audit process now gave a clearer focus on risk which had been a recommendation from the Internal Audit peer review. It also clearly set out the recommendations, priorities and implementation dates.

26.3           In terms of the garden waste audit, the Head of Corporate Services explained that it had resulted in two ‘limited’ opinions and two ‘satisfactory’ opinions but he was keen that this did not detract from the successful implementation of the project; lessons learnt would be taken forward and it was expected that the income would amount to around £800,000 by the end of the current year. In terms of the limited opinion, Members were advised that this was due to the fact that the collection and storage of customers’ data did not comply with the General Data Protection Regulation (GDPR) as there was no retention schedule in place and a data sharing agreement was required between the Council and Ubico; this would be complete by October 2018. In addition, there were a couple of operational issues relating to stock control and the emptying of bins that were not displaying stickers and therefore were not members of the scheme. In terms of stock control, the issue was that the stickers held in stock were of monetary value and therefore should be securely held and a stock control system in place – this had now been rectified. In terms of operational issues, the collection of bins had been tested by putting unstickered bins in ten locations across the Borough; unfortunately, in five out of ten cases, the unstickered bin was emptied which showed there was work to do with Ubico to ensure crews understood they should not collect bins with no stickers. There was also a need for improved reconciliation against the ledger and a proper refund process to be established. In terms of fees, this was delegated to Officers and would be considered through the budget setting process with consideration of evidence to show the justification for any increases. Moving forward ownership of the service needed to be established and discussions on how to resource phase two were being held with the Management Team.

26.4           Referring to the scheme of delegation, a Member questioned whether this could be changed as she was of the view that Members needed to have a say in what decisions were, and were not, delegated to Officers. In response, the Head of Democratic Services explained that this was something which was under review and would be considered by Members in due course. In terms of the stickers for the garden waste service, a Member questioned whether Officers were addressing the problem with the colours of the stickers being bleached by the sun.  In response, the Interim Corporate Services Manager explained that the team was aware of the issues and had already started the process of finding the best way forward to address them. Other Councils had been approached to understand how their stickers/suppliers differed from those used by the Borough Council and it was hoped the quality of the stickers could be improved as well as the price being reduced. The Member felt the real test of the new scheme would be the roll-over year and whether customers were retained and new ones gained. In response, the Interim Corporate Services Manager explained that the customer base had already increased by 3,000 and now the Council had a single sign-up date the review letters would be much easier to produce. In addition, customers were now used to the new process so they would find it easier to sign-up again which should mean those customers would be retained. The new system was not as resource intensive as the old process of renewals throughout the year but it would be more work than the Customer Services Team could handle so discussions were ongoing in that regard. In terms of costs of the project, the Committee was advised these were estimated as much of the officer time was not quantifiable. There were printer costs and graphics set-up costs which could be used to offset some costs but it should also be borne in mind that there were efficiency savings from the larger mailing run as most of the work was now front loaded at the beginning of the year. In response to a query regarding a new customer who wished to sign up later in the year, the Interim Corporate Services Manager advised that the Council no longer did pro-rata payments, but in the month of September the cost to sign up was reduced by half as a special discount; this meant the scheme was seasonal and there was some concession for members joining later in the year. Another Member questioned what happened when people shared bins; whether there was a digital solution for the sticker issues; and if a word other than ‘licence’ could be used to describe the stickers as she felt it was intimidating to customers. In response, she was advised that the word ‘licence’ was only used internally - to customers it was known as a sticker scheme. In terms of the use of stickers, this was felt to be the easiest way for the collection crews to see that a customer had paid and therefore their bin should be collected; there was currently no ability for the crews to scan bins etc. to know if it should be collected. Over 69% of customers had signed-up online so it was felt the system was now much more user-friendly; in addition, there would be a minimal amount for customers to do to renew the scheme as 80% of the customer base would receive an email which asked them just to tick a box to let the Council know they wanted to continue. In terms of the collections made in error when the scheme was audited, the Interim Corporate Services Manager explained that there had been a change in Ubico’s operational supervisor who was keen to work with the Council to ensure those issues were addressed and it was anticipated there would come a point where no bins were collected which did not display a sticker.

26.5           In terms of the audit of Council Tax, the empty homes premium had been introduced and was being applied in accordance with the policy. The policy to issue penalty charge notices was yet to be implemented as it had been approved prior to the Revenues and Benefits Manager taking up her post and she was concerned about the resources needed to implement the scheme. In terms of operational risks, audit work had been undertaken around liabilities being correctly identified and applied and a good level of control had been found. The single persons discount was one of the largest and the audit team had identified a recommendation around the disregards; that recommendation had been accepted and would be implemented at the end of June 2019 rather than 2018 as set out in the report. In respect of the Disabled Facilities Grants audit, the Council had been given an extra £112,000 and the scheme had been audited to ensure the money had been spent for the purposes intended – there was one recommendation from the audit which identified the need to evidence the completion of works at Severn Vale properties rather than accept a verbal assurance. In response to a query regarding the extra funding, the Environmental Health Manager explained that the money had to be spent relatively quickly so the rules on what it could be used for had been relaxed meaning it could be used for items such as ramps.

26.6           Referring to the audit on the General Data Protection Regulation, the Head of Corporate Services explained that, whilst data retention schedules were in place for each service area, there was some inconsistency and there was a corporate approach ongoing to address this and ensure the functions in all services were adequately covered - he was confident this would be achieved by the end of November. The ultimate aim would be to amalgamate all of the retention schedules into one document which was the reason they needed to be consistent. During the discussion which ensued, a Member questioned when Councillors would be provided with footers for their emails to ensure they were compliant with the General Data Protection Regulation. He understood this had been addressed in other authorities and felt Tewkesbury Borough Council needed to ensure it was keeping up. In response, the Head of Democratic Services advised that she was aware that work on this matter was being undertaken and she would follow that up after the meeting. Members asked that a definitive timescale be obtained and that they be advised accordingly.

26.7           Referring to Appendix 2, the Head of Corporate Services explained that, of the outstanding audit recommendations, 12 had been implemented; seven had been partially implemented; and nine had not been implemented. In terms of those partially implemented, Members were advised that there were some issues with data retention in relation to commercial properties and this would be updated and completed by the end of quarter two; it was felt there was scope for the bulky waste service to be more commercial but the review of that service would now be undertaken as part of the wider waste project; the ICT environmental controls would be picked up within the remit of the new ICT Operations Manager and new dates for implementation would be agreed; the Key Performance Indicators (KPIs) in respect of Ubico had been discussed at the Corporate Governance Group and there were days allocated in the second half of the audit plan to revisit the audit of Ubico and provide Members with a clear picture on where the Council was with the client monitoring of Ubico; in terms of the licensing audit there was an action plan arising but the service was currently part of the review of Community Services and that work had taken priority. In terms of the ICT requirements for Councillors, the implementation date for the project had been amended in line with the new Council term from May 2019.

26.8           During the discussion which ensued there was concern expressed about the Ubico client monitoring and the fact that implementation dates kept getting changed. The Head of Corporate Services agreed that this was an issue and reassured Members that the Head of Community Services was picking up issues and dealing with them as and when they arose – there were two recommendations around KPIs and those had been discussed at length by the Overview and Scrutiny Committee; once the new KPIs were in place it was intended they would be audited to check they were accurate and being monitored correctly. In terms of the IT within the Public Services Centre building, Members felt the Wi-Fi and mobile issues needed to be addressed and that this must be a priority, especially in respect of the Growth Hub. The Vice-Chair proposed, and it was seconded, that action be taken as a priority to ensure the technology within the Growth Hub was effective.

26.9           Accordingly, it was

                  RESOLVED          1. That the audit work completed, and the assurance given on                                     the adequacy of internal controls operating in the systems                                      audited, be NOTED.

                                                 2. That action be taken as a priority to ensure the technology                                       within the Growth Hub is effective.