Attended the Audit Committee earlier today - as a substitute for one of my colleagues.
Was specifically interested in the Internal Audit review of the 2006/07 Children and Families budget - the full report is here. I personally think it's a very clear report with very clear conclusions and recommendations.
There was an interesting debate at the Committee about the contents of the report - with (surprisingly for a change) no political-mud being thrown and a constructive discussion about how to avoid such problems in the future.
We moved a motion welcoming the report and asking for it to be referred on to the Policy and Strategy Committee - I'll reproduce the full text below. Was pleased that the motion was accepted by all Parties present, with the slight amendment to refer it to Full Council and not Policy and Strategy.
... will be interesting to see if the constructive approach taken at today's meeting is mirrored at Full Council - I have my doubts, but perhaps I'm getting too cynical in my old age :-(
Committee acknowledges that the report, in relation to action taken by the last administration, states that "reports to the council highlighted the seriousness of the budget situation" and the departments were instructed by the Council Executive committee to "prepare a raft of measures to contain the projected overspend".
The report in particular identifies failures in the financial management arrangements within the Children and Families budget par 3.4 (1 – 19) which was exacerbated by the inability to track income as well as expenditure adequately.
Also in relation to demand led budgeting the report concluded that "the lack of operational information on current demand and trends leads to an inability to forecast costs and undermines the effectiveness of management control"
The committee therefore agrees,
1) To note the report by the Council’s Chief Internal Auditor and to approve the action plan appended to the Auditor’s report.
2) To refer the Chief Internal Auditor’s report to the Policy and Strategy Committee for consideration.
3) To acknowledge the findings of the report and ask the Director of Finance to undertake the work identified in paragraph 4.8 and to report to the appropriate Committee in due course.
4) To recommend that the Policy and Strategy Committee, as a matter of urgency, reviews how ‘demand led’ budgets are managed particularly in relation to the increasing complexity and cost of services to the elderly and ‘vulnerable’ young people