Agenda item

To receive and discuss an update on General Matters.

The Committee received and discussed a report submitted by the Director of Finance which gave an update on issues which have previously been reported to the Audit Committee, including financial challenges being experienced at other Local Authorities and the current position in relation to the audit of the Councils accounts for 2021/22 and 2022/23.

This report sets out six key matters which have the potential to impact on the future work of this Committee in undertaking its governance role within the Council. These are covered in detail at Section 2 of the report.

Members were reminded that at previous Audit Committee meetings there have been reports which have advised on a number of financial issues impacting on the whole Local Government sector and specific matters relating to Oldham Council. This report provides some follow up information in relation to issues previously raised.

Members were further reminded that the Committee had received information about the matters which have resulted in the S151 Officers of several Local Authorities issuing a Notice under the powers of S114(3) of the of Local Government Finance Act 1988 (a Section 114 Notice) that the expenditure of the Authority would exceed the resources available to finance it. These Authorities include the London Borough of Croydon, Slough Borough Council, Woking Borough Council and Thurrock Council.

Each of the above Councils is still facing a substantial challenge to stabilise its financial position and it will take many years to address the consequences of the issuing of the 114 Notices. Details relating to the issue of Section 114 Notices in relation to Nottingham City Council, Northumberland County Council and Birmingham City Council are set out in paragraphs 2.3 to 2.5 of the report.

The Director of Finance drew attention to a further four Councils that are facing financial challenges and are at risk of Section 114 Notices being issued, paragraphs 2.6(a) to 2.6(d) refers.

In response to a query about the Section 114 Notice issued to Birmingham City Council relating to financial liabilities regarding Equal Pay claims and an in-year financial gap within its budget which at the time stood in the region of £87m and how this Council stood on such matters, the Director of Finance informed Members that the Council did a very extensive exercise on equql pay when the issues first arose back in 2011-12 when a review was undertaken. We were able to rectify our equal pay position and payments were made to a range of qualified individuals. The Council’s process around pay in respect of grading and evaluation should stand the test of any challenges unlike Birmingham who did not set up the process properly.

The Director of Finance advised the Committee that in accordance with the Committee’s instruction at the previous meeting a letter had been written to the Greater Manchester Audit Office regarding the delay to the audit of the 2022-23 Statement of Accounts but as yet no response had been received.

Resolved – that

(i)  the Committee notes the receipt from the External Auditor of a letter advising of a delay to the audit of the 2022-23;

(ii) the report be noted.