The Chairman welcomed and introduced all present to the meeting and advised on the remit of the Licensing Panel in determining the matter as detailed in the confidential report of the Executive Director.

The Panel had to determine whether the driver remained a fit and proper person to continue to hold a Dual Drivers’ Licence as a result of a number of incidents relating to the individual’s conduct. 

The confidential report detailed three separate incidents involving speeding, the first of which had also involved a conviction for failure to give information as to the identity of a driver (MS90) and the latest incident which also included an allegation of unacceptable driving behaviour.

Members heard from the Environmental Health Licensing officer, who provided details of the speeding incidents and the driver who, whilst admitted speeding, provided mitigating reasons for the incidents in their defence.  Since the publication of the report a letter of support from an interested party involved in the last incident had been received and was circulated to all present. 

Members asked a series of questions in relation to the details around the incidents detailed in the report and provided by officers, witnesses and the driver. 

The Panel retired to consider the case in private. The Panel took into account all the written evidence provided to them and the verbal statements made by the Environmental Health Licensing Officer and the driver.  The Council’s legal representative advised the Panel on the matters that should be taken into account in determining this case. 

The Panel gave careful deliberation to the evidence provided in regards to all of the allegations made. The Panel decided that driver TPHLP190806 no longer remained a ‘fit and proper person’ to hold a licence. The Panel took the decision that the behaviour was not that expected of a licensed driver, and warranted the revocation of the licence in this instance.

RESOLVED: That the licence for Dual Driver TPHLP190806 be revoked.

(This matter was considered exempt from publication by virtue of Paragraphs 1, 3 and 7 of Part 1 of Schedule 12A of the Local Government Act 1972, as amended).

Consideration was given to the report of the Executive Director that gave details of an application for a premises licence for the Johns Cross Country Store, Johns Cross, East Sussex for the licensable activity of the retail sale of alcohol (off the premises), Monday to Sunday 08:00 - 21:00hrs.   One representation had been made in relation to the application in regard to the licensing objectives of the prevention of crime and disorder and the prevention of public nuisance. 

Prior to the commencement of the meeting, the Deputy Legal Services Manager gave advice to the Interested Parties regarding the grounds on which the licensing application could be considered.

The Chairman welcomed all who were present and gave general advice in regard to the hearing. The Panel then proceeded to hear the case following the adopted procedure and all parties present at the hearing were invited to address the Panel.

The Panel heard from Mr Nigel Harwood, Environmental Health Licensing Officer, who presented the report of the Executive Director detailing the application and then from Professor Roy Light, the Applicant’s Legal Representative, who presented the case for the application.

All letters of objection and support were given the Panel’s full consideration.

Members deliberated on the application which was determined having regard to the licensing objectives, together with the Guidance under Section 182 of the Licensing Act and the Local Licensing Policy and retired to make their decision in private session.         

RESOLVED: That the application for a Premises Licence be granted subject to the conditions as set out in Appendix 1.

(Councillor Field declared a personal interest in this matter in so far as she was an elected Member of East Sussex County Council for Battle and Crowhurst and in accordance with the Members’ Code of Conduct remained in the room during consideration thereof.)

Cabinet had approved the Council’s 2019/20 Investment Strategy in February of this year; this required regular reports to be presented to the Committee on the Council’s treasury management activities. Investment activity was also reported to Members through the monthly Members’ Bulletin.  The report had been prepared in compliance with the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management (revised 2017). 

The report provided an update on a number of areas as follows:

•           The Council made the most of its investments through the use of call and deposit accounts with the major financial UK institutions.  In addition to this, the Council had invested £5m in the Churches, Charities, Local Authorities’ (CCLA) Property Investment Fund and £3m in the HERMES Property Investment Fund.

•           The Council held £32,083,554 of investments as at 30 November 2019. There was £12,045m of borrowing at 31 July 2019 and the Capital Financing requirement was £16.7m.

•           The total income from financial investments was estimated at £492,000 with an average rate of return on investments of 1.89%. This was slightly below the annual budget of £512,000.

•           During 2019/20, the Council had maintained an under-borrowed position, meaning that the need for borrowing, (the Capital Financing Requirement), was not fully funded with loan debt, as cash supporting the Council’s reserves, balances and cash flow was used as an interim measure. This strategy was prudent as investment returns were low and minimising counterparty risk on placing investments also needed to be considered.

•           The total spend and funding of the Capital Programme for 2019/20 was summarised in the report, the total funding being £17.9m.

•           The Council continued to invest in the economic regeneration of Rother through its Property Investment Strategy (PIS).  The budget for rental income from all investment properties was £1,939,000; the latest estimated outturn for 2019/20 was £1,531,200 a shortfall of £408,550.  This equated to a 6.6% gross return on the value of all properties including those purchased under the PIS.

•           New guidance on non-treasury investments had been published by CIPFA, which was currently being reviewed.  A report would be brought back to the Audit and Standards Committee.

The investment activity during the year conformed to the approved strategy, and the Council had no liquidity difficulties. The investment environment for treasury activities remained very difficult with absolute returns continuing to be very low. The diversification into Property Funds had increased the net overall return but did come with a greater degree of capital risk than other investments and was less liquid.  The Council’s PIS planned to generate returns in excess of 2% (net of borrowing costs), which was greater than predicted for treasury investments.  Members requested details of the Council’s investment properties; these would be included in a future report.

RESOLVED: That the report be noted.

The Audit Manager led Members through the internal audit report to 30 September 2019 that gave details of audit matters and any emerging issues, not only in relation to audit but risk management and corporate governance.  It was advised that, owing to a combination of audit overruns and other circumstances beyond the Council’s control, overall progress on the 2019/20 Audit Plan was slightly behind target at present, meaning that some of the planned audits would not be carried out during the current financial year. The annual Governance Audits were, however, well underway and the Internal Audit Team was making good progress.   

The report gave details of the three audits completed in the quarter (HMO Licensing, Joint Waste Contract and Car Park Income), two of which had been given good or substantial assurance on the overall governance arrangements. However, the third report (Car Park Income) only provided limited assurance owing to the issues found with the operation of Western Car Park, Camber. The precise nature of the audit findings were the subject of a separate confidential report elsewhere on the agenda. 

It was noted that the Joint Waste Contract audit was based on the outgoing contract with Kier; the Biffa contract would be covered later in the year.

Work on four other audits (Housing Allocations, Property Investment, Community Infrastructure Levy (CIL) and Software Licensing) was at an advanced stage as at 30 September 2019.  

All recommendations issued to date in the current financial year had been implemented. It was noted that progress on the older year recommendations had been quite slow this quarter with a total of 13 recommendations still outstanding. All cases where there had been no movement in the past six months had therefore been brought to the attention of the Executive Directors for further action.

At the previous meeting, the Committee expressed concern that three recommendations from 2017/18 were still outstanding and they requested a progress update at the next meeting.  Progress was being made to address all issues, although none had so far been resolved.  The implementation of two Data Protection recommendations had been delayed due to the previous Data Protection Officer leaving the authority.  The writing of the Document Retention Policy had become a larger piece of work than had initially been anticipated, but privacy notices had been placed on the website.  Data Protection training would be rolled out to all staff and Members in the New Year.

Migration of the email exchange server was now complete so the off-site disaster recovery exercise could now be run.

RESOLVED: That the Internal Audit report to 30 September 2019 be noted.

At the last meeting, the Committee was advised of the need to appoint an Independent Person (IP) following the resignation of one of the Council’s three IPs.

The Committee agreed that the Chairman of the Committee and an Executive Director together with the Monitoring Officer comprised a panel to interview the suitable applicants and make a recommendation to the Audit and Standards Committee and then on to full Council on 16 December 2019.

At the closing date (18 October), eight applications had been received and four candidates were shortlisted for interview, held on 30 October and 5 November 2019.  The expectations of the role in terms of regular attendance at meetings and contributions to committee discussions on standards matters were explained to each applicant at interview.

The calibre of the applicants was high and the Panel was confident to recommend that Mrs Rose Durban be appointed to serve as one of the Council’s IPs and for her name to be put forward for approval by the full Council on Monday 16 December.

The Chairman welcomed Mrs Durban to the meeting and Members requested that they receive a brief biography from Mrs Durban, which would be forthcoming.

RECOMMENDED: That Mrs Rose Durban be appointed as an Independent Person in accordance with Chapter 7, Section 28 of the Localism Act 2011, for a term of four years commencing from 17 December 2019.

At the June 2019 meeting, the Audit and Standards Committee received a report on the Committee on Standards in Public Life’s (CSPL) Review of Local Government Ethical Standards and gave consideration to the resulting recommendations.  It was noted that a detailed report would be presented to the December meeting following an officer assessment of the Council’s current performance against the best practice recommendations that had also resulted from the CSPL’s review.       

To date, the Government had not yet responded to the CSPL’s report, however Hoey Ainscough Associates Ltd had been appointed by the Local Government Association to draw up a new national model Code of Conduct to be launched at their July 2020 conference.  A formal consultation with all councils was to follow on a proposed draft in the spring, after initial consultations with representative bodies such as Lawyers in Local Government, Association of Democratic Services Officers etc.

Officer assessment against the best practice recommendations was attached at Appendix A to the report and Members were pleased to note that 10 out of 15 best practice recommendations were already processes and procedures operated by the Council.

The Monitoring Officer outlined the proposed actions to be undertaken to meet the remaining five best practice recommendations and confirmed that further reports would be made to the Committee if and when the Government brought forward any changes to legislation as a result.

Members felt that the current threshold for registering a gift or hospitality at £50 was too high.  It was agreed that this would be looked at when considering the new model code in the New Year and whether any interim changes to the Council’s Code of Conduct were required in the meantime.

RESOLVED:  That the assessment of the Council’s current practice and proposed actions against the best practice recommendations be noted and the following actions be approved:

Best practice 3 – the Council awaits the outcome of the Government’s response to the CSPL recommendation that there be a new non-mandatory new model code of conduct before carrying out another review.

Best practice 5 – Members be reminded of the need to review their registered gifts and hospitality quarterly.

Best practice 6 – the Monitoring Officer carries out a review of other local authority public interest tests to see whether the Council’s current documentation can be improved.

Best practice 9 – to be adhered to as and when required.

Best practice 11 – should a complaint be received from a Parish Clerk concerning the conduct of a Parish / Town Councillor, it would be recommended that the complaint be lodged by the Chairman of the Parish / Town Council.

The Chairman welcomed Darren Wells from Grant Thornton to the meeting who proceeded to summarise the External Auditors’ Annual Audit Letter for the year ended 31 March 2019.  The External Auditors’ Annual Audit Letter 2018/19 summarised the key issues arising from the work that had been carried out by Grant Thornton in the areas of Financial Statements and Use of Resources. 

Financial Statements – Grant Thornton issued an unqualified opinion on the Council’s financial statements on 9 September 2019.  The Council’s accounts were prepared to a high standard.  The only material adjustments related to pension assets and liabilities, which were amended to reflect final figures provided by the Council’s actuary after the draft accounts had been prepared. 

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Use of Resources – Grant Thornton was satisfied that in all significant respects, the Council put in place proper arrangements for securing economy, efficiency and effectiveness in its use of resources for the year ending 31 March 2019.

Grant Thornton had not identified any matters which required them to exercise their additional statutory powers.  One risk was considered in the issue of Value for Money, but was found to be sufficiently mitigated.

Grant Thornton also carried out works to certify the Council’s Housing Benefit subsidy claim on behalf of the Department for Work and Pensions.  The results would be reported at the next meeting of the Audit and Standards Committee.

The fees charged for services were detailed at the end of the letter.  Due to the requirement for additional work to be carried out over and above that originally envisaged in the audit plan, there was a proposed fee variation which was subject to approval by the Public Sector Audit Appointments.

Mr Wells advised that the issues which had resulted in the late completion of the Council’s audit were being addressed.

In summary, Grant Thornton assured Members that the finances of the Council were being well managed by a well-run team and the Council’s staff were thanked for the assistance and co-operation provided to the auditors.

RESOLVED: That the report be noted.

The Committee received the routine report of the Monitoring Officer (MO) which advised that seven valid Code of Conduct complaints had been made against two Parish Councillors and four District Councillors since the last meeting.  In accordance with the wishes of the Committee, as none of the complaints had resulted in an investigation and a finding of fault, they were presented anonymously.  The view of the Council’s Independent Persons had been sought and concurred with the Monitoring Officer’s proposed action in each case; details of each case had been provided at Appendix 1 to the report.

In case C19-01, whilst the Subject Member ultimately agreed to the proposed recommended local resolution there was an unnecessary delay of some nine working days, which caused additional administrative work in contacting the Subject Member on more than one occasion and involving their Group Leader.  

It was therefore recommended that Subject Members were given five working days to respond to any request from the MO; failure to do so would result in a subsequent report to the Audit and Standards Committee, whether or not the local resolution was agreed to.  This requirement could be added to the Arrangements for Dealing with Member Complaints and the MO Protocol procedural documents, which was within the powers of the Audit and Standards Committee to make amendments thereto.  

Five non-valid complaints had also been received during this time, against three District Councillors and two Parish Councillors.  On four occasions (three District / one Parish) the conduct which gave rise to the complaints was carried out in Councillors’ private lives (the Code only applies when conducting the business of the authority) and the other related to the actions of the Parish Council as a whole and not an individual Parish Councillor. 

An anonymous complaint had also been received from a “Mrs Taxpayer” against a District Councillor, which was not entertained in accordance with procedures.  There were no outstanding complaints at the current time.

Within the Committee’s functions and delegations was a duty to promote and maintain high standards of conduct by Members of the Council and a number of standards matters had taken place since the Committee’s last meeting in this respect.

A training session on ethics and probity had taken place on Thursday 25 July; the training was delivered by Hoey Ainscough Associates Ltd.  The event had received mixed reviews and it was suggested that the training could have been delivered in-house.  The advantage of receiving training from external consultants who dealt with standards matters across the country was the ability to provide numerous case studies and talk about real cases without the fear of talking about local cases; if this training was delivered in-house, this ability would be lost.

It was recommended that the requirement to complete a declaration of interest form each time a Member made a declaration at meetings ceased from January 2020, as there was no formal requirement for this form to be completed.  The cessation of this process would provide a cost saving in terms of reduction on paper usage and staff administrative time both pre and post meetings.  Members would need to ensure therefore that declarations were clearly stated at meetings as there would be no paper form as a back-up. 

Interests declared at all meetings were recorded and included within the Minutes and the new committee management software system provided a search facility that allowed a member of the public to search the declarations of interests made by each individual Member.

At the request of Battle Town Council on Tuesday 16 July, the MO provided an information session to Members of Battle Town Council on their Code of Conduct, declarations of interest and the Member Complaints process; this was well received. 

As reported at the last meeting, following the influx of new Members to the Parish and Town Councils across the district, the MO advised that there remained one or two outstanding registers of interests for newly elected or co-opted Members which were actively being pursued.  

RESOLVED:  That:

1)         the report be noted;

2)         the Arrangements for Dealing with Member Complaints and the Monitoring Officer Protocol be amended to include the requirement for Subject Members to respond to suggested local resolution requests within five working days; and

3)         the requirement for Members to complete a declaration of interest form for each declaration cease from January 2020.

Members considered the report of the Executive Director that set out details of 11 complaints made to the Local Government Ombudsman (LGO) covering the period 1 June to 14 November 2019.  The Head of Service Housing and Community reported that of the 11 complaints detailed, two were upheld, one was not upheld, six were not investigated, one had been withdrawn and one was awaiting the final decision.  In both cases where the complaint had been upheld, the recommendations from the Ombudsman had been carried out and actions taken to avoid similar occurrences.

Previously the Committee asked for details in relation to non–ombudsman complaints made to the authority for the same period.  There were 116 complaints made by residents from 1 June 2019 to 14 November 2019.  Of these, 77 were non-complaints, 21 were resolved at the initial stage, one was a stage one complaint, one was a stage two complaint and 16 were awaiting determination/under investigation.

It was noted that the LGO recorded the number of complaints per 10,000 individuals; the result for Rother District Council was below the average for local authorities.  Members were pleased to note that the new complaints procedure had resulted in an increase in the number of complaints being resolved in their early stages.

RESOLVED: That the report be noted.

Members received the report of the Monitoring Officer, advising the replacement of Councillor Alan Stainsby who resigned as Parish / Town Council representative on 30 September 2019.

The Chairman paid tribute to Mr Stainsby who had served on the Committee since 2007 and thanked him for his long service, on behalf of the Committee.

At the Rother Association of Local Council meeting held on 23 October 2019, Councillor David Smedley, Icklesham Parish Council, was appointed to the current vacancy created by Mr Stainsby’s resignation. 

The Chairman welcomed Councillor Smedley in his absence to the Committee.

RESOLVED: That the revised make-up of the Committee be noted and the newly appointed Parish and Town Council representative, Councillor David Smedley, be welcomed to the Committee. 

Following receipt of the updated report from the External Audit Manager at Grant Thornton, no material changes had been made to the Final Statement of Accounts 2018/19 approved by Members in July 2019.

RESOLVED: That the updated Final Statement of Accounts 2018/19 report be noted.

At the request of Members at the June meeting, (Minute AS19/09 refers) an oral report was given on the current position of the Unit 4 Systems Administration.

Members were advised that interim support for the management of the Council’s Unit 4 accounting system had been provided both internally and through the external company that was supporting the delivery of the new system. In addition, very useful support is being provided as necessary from the Council’s partner, Hastings Borough Council.  The Assistant Director Resources was considering ongoing technical support from an independent organisation in addition to that provided by Unit 4 in the longer term.

RESOLVED:  That the verbal update be noted.

Council approved the Council’s 2019/20 Investment Strategy in February 2019 (Minute CB18/66 refers).   The Investment Strategy required regular reports to be presented to this Committee on the Council’s treasury management activities. Members were also reminded that investment activity was also reported through the Members’ Bulletin. In managing its treasury management activities, the Council followed the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management (revised 2017). 

The report provided an update on a number of areas as follows:

•           The Council’s treasury advisors, Link Asset Services, had provided their view on the current economic climate and their outlook for the remainder of 2019/20, which was appended to the report. 

•           The Council made its own investments through the use of call and deposit accounts with major financial UK institutions.  The Council had also invested £5 million in the Churches, Charities, Local Authorities’ (CCLA) Property Investment Fund.  A further £3 million was invested into the HERMES Property Investment Fund. 

•           The Council held £31,796,676 of investments at 31 July 2019. The total income from investments was estimated at £164,819, slightly behind the profiled budget to July 2019 of £170,666, with an average rate of return on investments of 1.64%.

•           There was £12,045 million of borrowing at 31 July 2019 and the Capital Financing requirement was £16.217 million.

•           The Council had recently invested in the economic regeneration of Rother through its Property Investment Strategy (PIS) and Members were updated with the expected income from the non-Treasury Investments.

•           The budget for rental income from all investment properties was £1,939,000.  This was made up of £970,000 for the existing assets and £969,000 for the properties purchased through the PIS.  The estimated outturn for 2019/20 was £1,650,267 a shortfall of £288,918.  This equated to a 6.6% gross return on the value of all properties including those purchased under the PIS.

The investment activity during the year conformed to the approved strategy, and the Council had no liquidity difficulties. The investment environment for treasury activities remained very difficult with absolute returns continuing to be very low. The diversification into Property Funds had increased the net overall return but did come with a greater degree of capital risk than other investments and was less liquid. The Council’s PIS had regeneration at its heart and it was planned to generate returns in excess of 2% (net of borrowing costs), which was greater than predicted for treasury investments. This came with greater risk due to the commitment to repaying borrowing and the direct operational risks of managing property. 

RESOLVED: That the report be noted.

The Audit Manager led Members through the internal audit report to 30 June 2019 that gave details of audit matters and any emerging issues, not only in relation to audit but risk management and corporate governance.  In addition to audit assurance work, the service had also engaged in various consulting activities during the quarter and continued to work with the Revenues and Benefits Section regarding the investigation of cases identified as a result of the National Fraud Initiative data matching exercise.

The report gave details of the two audits completed in the quarter (Community Grants and Disabled Facilities Grants), both of which had given substantial assurance on the overall governance arrangements. 

It was advised that whilst progress had been slow on the older recommendations during the quarter, many of the newer recommendations continued to be implemented. It was noted that there were a small number of recommendations where there had been little movement in recent months. Recommendations older than six months where there had been no recent progress had been escalated to the Executive Directors.

At the meeting of the Audit and Standards Committee on 24 June 2019, Members requested an update on Whistleblowing Policy activity, which was provided at Appendix C to the report.

In summary, a total of 12 whistleblowing cases had been reported to the Audit Manager in 2018/19. These included a range of allegations, the majority of which focused on either Benefit/Council Tax Fraud or Housing Tenancy Fraud. All cases were initially reviewed by the Audit Manager and then either referred to the relevant Council officer for further investigation or reported to the appropriate authority.

Members had an opportunity to put forward questions and the following points were noted during the discussion:

•           The Audit Manager confirmed that the Audit Recommendation not yet started from 2017/18 related to an I.T. off-site disaster recovery exercise that had not been completed for five years, but had since been downgraded to a low risk.  I.T. systems had become much more robust but an exercise was still required. Members agreed that the matter should be discussed by management and if necessary a further report be made to this Committee;

•           Members suggested that recommendations from previous years that were either ‘work-in-progress’ or ‘not started’ be reviewed as they may have been overtaken since; and

•           the objectives marked as ‘Partially Met’ in the Community Grants and Disabled Facilities Grants Audits both related to procedures not being followed correctly. The Audit Manager was however satisfied that correct systems had now been put into place.

RESOLVED: That the Internal Audit report to 30 June 2019 be noted.

At the meeting on 24 September 2018 (Minute AS18/20 refers), Members requested that consideration be given to the Strategic Risk Register in order to take into account the potential effects of the impending departure of the United Kingdom from the European Union (EU).  A further report was brought to this Committee on the 25 March 2019 (Minute AS18/42).  At the time of writing this report the delayed departure date from the EU has now been set for 31 October 2019.  A scenario in which the UK leaves the EU without agreement (a ‘no deal’ exit) still remains uncertain.

The Minister for Housing, Communities and Local Government (MHCLG) had recently written to the Leaders of all local authorities in England stating that the UK would be leaving on the 31 October and emphasised the role of Local Government in preparing for EU Exit. 

An EU Exit Team had been set up consisting of  the Head of Planning; Head of Environmental Health, Licensing and Community Safety; ICT Manager; Emergency Planning Officer; and Human Resources Manager who met on a weekly basis to consider communications received, the risk register and action log and tracking preparative activity for EU Exit.  Whilst the Council could not be held accountable for EU implications for businesses and communities, it did have a role in assisting with communications and ensuring businesses and communities understood and were aware of the issues and could take the necessary actions to mitigate or minimise disruption.

All local authorities had received a grant to assist with the resource impacts for having to prepare for EU Exit.  Rother District Council (RDC) had received £17,484 in the 2018/19 financial year with a similar grant received for the 2019/20 financial year, a total of c£35,000, however to date, no funds had been allocated. The Sussex Resilience Forum had also received a regional grant into which RDC could bid for further financial assistance if special regional circumstances arose that affected Rother District.  These grants were not expected to meet any on-going costs to services following Brexit.

Members commended officers for their work. It was requested and agreed that Members be kept informed following meetings of the EU Exit Team.

RESOLVED: That:

1)         Members be sent regular updates from the EU Exit Team; and

2)         the report be noted.

The Council was firmly opposed to fraud and corruption of any kind and had a suite of policies and procedures used to promote a culture of openness, honesty and opposition to fraud. The documents formed part of the Council’s Anti-Fraud and Corruption Framework and were last approved at full Council in February 2016 (Minute C15/63).

The Framework had recently been reviewed and Members received a report of the Executive Director detailing proposed amendments to the Framework, which took into account changes in legislation and post titles. Members were asked to consider the proposed changes and recommend them for approval by full Council.

Members had an opportunity to put forward questions and the following points were noted during the discussion:

·                 Members queried the removal of the wording ‘invoke disciplinary proceedings’ at section 2.0 of the document (page 37 of the Agenda).  The Audit Manager explained that the wording had been removed as it was not a strategic objective, but the point was still covered in section 5.0 (page 41 of the Agenda) which clearly stated ‘Disciplinary action and prosecution will be invoked whenever fraud or corruption is found’;

·                 at section 5.0 of the document (pages 46 and 47 of the Agenda), Members queried why employees and Members were given a list of Designated Officers to refer to rather than a specific contact.  The Audit Manager explained that the wording allowed for flexibility in a number of fraud/corruption scenarios; and

·                 at section 8.0 of the document (pages 47 and 48 of the Agenda), Members queried why members of the public could not be given a specific contact.  It was agreed that the section be amended to signpost the public to the Audit Manager, which also applied to the Whistleblowing Policy on page 73 of the Agenda.

RECOMMENDED: That the revised Anti-Fraud and Corruption Framework be approved and adopted, as amended.

Members received the report of the Monitoring Officer giving details of the resignation of Mr Robert Tye, one of the Council’s three appointed Independent Persons (IPs), with effect from 8 August 2019. 

The Council took the decision in 2016 to increase the number of IPs from two to three to provide increased resilience and an opportunity for the third IP to work alongside Mrs Susan Fellows and Mrs Jan Gray whose terms of office was due to expire in 2021.  The existing IPs’ terms of office were not renewable under the terms of the Localism Act as both would have served eight years by July 2021.  Having a restricted tenure ensured that the judgment and independence of the IPs was not compromised by a long period of involvement in a single authority.

In order to provide a small hand-over period, of some 18 months to maintain resilience and ensure a level of continuity and institutional memory, it was recommended by the Monitoring Officer that the Council proceeded immediately to recruit a third IP and the report set out the proposed arrangements for the recruitment.

The proposed Role Description and Person Specification was also attached to the report for Members’ information.  It was hoped that this would help attract candidates who were willing and able to commit to the expectations of the role.  Members requested and agreed that ‘Personal Integrity’ which was listed as one of the Personal Qualities detailed in the Person Specification, be amended to ‘Integrity’.

It was proposed that an advert for one Independent Person be placed on the Council’s website and highlighted through social media messages and MyAlerts, inviting applications with a closing date of Friday 18 October 2019.  The vacancy would also be notified to all Councillors and all Parish and Town Councils within the Rother area.  It was also requested and agreed that a press release be given detailing the opportunity to Rother residents.

The interview panel would comprise of the Monitoring Officer, the Chairman of the Audit and Standards Committee and an Executive Director.  It was recommended and agreed that ‘or a nominated substitute’ be added to the recommendation if the Chairman of the Committee was unavailable.  The appointment would be recommended to the Committee at the next meeting scheduled for 9 December, for onward recommendation to Council.

It was also reported to Members that Councillor Stainsby would be resigning with effect from 30 September 2019 from the Committee as one of the two appointed Parish/Town Council representatives.  Rother Association of Local Councils (RALC) would therefore nominate and appoint a replacement Parish/Town Councillor to join the Audit and Standards Committee in due course.

RESOLVED:  That:

1)         the resignation of Mr Robert Tye with effect from Thursday 8 August 2019 be noted;

2)         the proposed arrangements for the recruitment of one Independent Person for a term of four years be approved;

3)         an Interview Panel be appointed comprising the Monitoring Officer, the Chairman of the Audit and Standards Committee, or a nominated substitute, and an Executive Director; and

4)         the proposed appointee be recommended to the Committees’ next meeting on 9 December for onward recommendation to Council on 16 December 2019.

Cabinet had approved the Council’s 2019/20 Investment Strategy in February of this year; this required regular reports to be presented to the Audit and Standards Committee on the Council’s treasury management activities. Investment activity was also reported to Members through the monthly Members’ Bulletin.  In managing its treasury management activities, the Council followed the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management (revised 2017). 

The report provided an update on a number of areas as follows:

•           The Council’s treasury advisors, Link Asset Services, had provided their view on the current economic climate and their outlook for the remainder of 2019/20, which was appended to the report. 

•           The Council made its own investments through the use of call and deposit accounts with major financial UK institutions.  The Council had also invested £5 million in the Churches, Charities, Local Authorities’ (CCLA) Property Investment Fund.  A further £3 million was invested in the HERMES Property Investment Fund. 

•           The Council held £25,366,860 of investments at 31 May 2019. The total income from investments was estimated at £85,270 compared to a profiled budget of £85,000; the average rate of return was 1.67%. 

•           During 2018/19, the Council maintained an under-borrowed position.  This meant that the capital borrowing need, (the Capital Financing Requirement), was not fully funded with loan debt, as cash supporting the Council’s reserves, balances and cash flow was used as an interim measure. This strategy was prudent as investment returns were low and minimising counterparty risk on placing investments also needed to be considered.

•           The Council’s treasury management debt and investment position was organised by the treasury management service in order to ensure adequate liquidity for revenue and capital activities, security for investments and to manage risks within all treasury management activities. Procedures and controls to achieve these objectives were well established both through Member reporting, detailed in the summary, and through officer activity detailed in the Council’s Treasury Management Practices.

•           The Council had invested in regeneration of Rother through its Property Investment Strategy and the expected income from these non-Treasury Investments was provided within the report.

•           Current property investments provided a net rental income of £970,000 per annum, a net income of £1,331,308 to date.

The Council’s current treasury management and investment strategies remained robust in managing the Council’s cash funds. The economic outlook remained difficult for a net investor such as the Council and supported the Council’s financial strategy to reduce reliance on investment returns.

RESOLVED: That the report be noted.

In accordance with the Accounts and Audit Regulations 2003, the Council’s accounts were required to be approved by the Council, or its delegated Committee, each year. The report of the Executive Directors discussed the main issues affecting the Council’s Statement of Accounts and provided a full commentary on the core financial statements. A draft copy of the full Statement of Accounts had been circulated to Members by email on 29 July 2019 and made available in hard copy format at the meeting.  A final Statement of Accounts was to be circulated to all Committee Members once the audit had been completed.  

At the time of writing the report, the Council’s external auditors, Grant Thornton, had largely completed their work on the accounts for 2018/19.  Grant Thornton’s report was discussed earlier in the meeting.  The published accounts included a Narrative Report and the Annual Governance Statement approved by the Committee at its meeting on 25 March (Minute AS18/38 refers).  The Code of Practice had required no major changes in the presentation of the accounts; however, the Council restructured its departments in 2018/19 so the presentation of the accounts for 2017/18 has been re-stated for comparative purposes.

The Corporate Transformation Finance Manager led Members through the Statement of Accounts and drew out the salient points. 

Rother District Council published the accounts on time to a high standard and the pension adjustment made was a recommendation of management not external audit.

It was noted that overall, the balance sheet showed that the financial position of the Authority remained sound with an adequate amount of reserves in place to meet short term needs. The Pensions Fund liability of £25m was a long term financial assessment of a possible shortfall based on its current performance and therefore no immediate action was required.  The net worth of the Council had increased by £2.4m and the useable cash resources of the Council had increased by £1.620m.

The Movement in Reserves statement showed the movement in the year on the different reserves held by the authority (analysed into ‘useable’ and ‘unusable’). The surplus of £0.735m on the provision of services line showed the true economic cost of providing the authority’s services. 

On behalf of the Committee, the Chairman thanked the Corporate Transformation Finance Manager and her team for their sound financial management of the Council, and Trevor Greenlee and the team of auditors from Grant Thornton for their work on the Council’s accounts.

RESOLVED: That:

1)     the Chairman be authorised to approve the Council’s 2018/19 Statement of Accounts and sign the letter of acceptance;

2)     the Chairman be granted delegated authority, in consultation with the Assistant Director Resources, to re-sign the accounts if any subsequent amendments were required, when the audit was completed; and

3)     the Chairman to call an extra-ordinary meeting of the Committee if required after finalisation of the accounts.

The Chairman welcomed Trevor Greenlee from Grant Thornton to the meeting, who proceeded to summarise the External Auditors’ Audit Completion Report for the year ended 31 March 2019. 

Grant Thornton had been unable to conclude the audit due to resource constraints. In line with the Accounts and Audit Regulations, the following notice had been placed on the website with the latest accounts:

“As at 31 July our auditor, Grant Thornton, has been unable to conclude the audit.  This is due to resource constraints resulting from a peak period of work during June and July when all local government accounts are audited.  Grant Thornton has confirmed that it takes full responsibility for this. The Council is continuing to work closely with the audit team as they complete their work. In line with the Accounts and Audit Regulations 2015, the Council has published a set of draft accounts. The Council will publish a final set of accounts as soon as the audit is concluded and the Audit Report issued.”

Members raised concerns that the Council’s legal obligation to publish the 2018/19 Statement of Accounts by 31 July 2019 had not been met and it was agreed that a letter be submitted to the relevant regulatory body by the Chairman of the Audit and Standards Committee and the Assistant Director Resources.

Audit Scope and Objectives

Grant Thornton had substantially completed their audit procedures in accordance with the planned scope and objectives, subject to the completion of outstanding work as detailed in the report. 

At the time there were no issues or errors to report.  The accounts and working papers were of a high standard.  The migration of the enterprise resource planning system was successful even though in Grant Thornton’s experience this area was of high risk. There were no unadjusted errors.

Adjustments to the accounts

When the IAS 19 report on pensions was commissioned, the actuaries were only able to provide an estimate of the asset values as at the 31 March 2019 of £91.9m.  At that time a report was also commissioned showing the actual values of the assets which was made available late June after the statutory deadline for publishing the accounts.  The report showed the actual asset values were £89.1m.  As the difference was £3m and was a material difference, the accounts were adjusted.

Judgement on a recent legal challenge by the Government against a ruling by the Court of Appeal in December 2018 that provisions in some public sector pension schemes were discriminatory on the basis of age (the ‘McCloud’ judgement), was likely to give rise to additional pension scheme liabilities for the Council.  After the draft accounts had been published, the McCloud judgement was decided in court and the contingent liability that the Council had made at 31 May became a provision and the accounts were adjusted appropriately. 

There were no unadjusted misstatements to report. A few presentational changes had been made to the financial statements as a result of the audit.

No additional significant audit risks were identified during the course of the audit and Grant Thornton concluded that the continued use of the going concern concept to prepare the financial statements remained appropriate. 

Key Audit and Accounting Matters

The Council reported a surplus of £631,000 for the general fund in 2018/19 and had total useable (cash-backed) reserves of £22,137,000 as at 31 March 2019.  Grant Thornton were satisfied that the Council had a comprehensive medium term planning framework.

Audit Opinion

Grant Thornton anticipated issuing an unqualified audit opinion on the financial statements for the year ended 31 March 2018 subject to the completion of outstanding work.  Grant Thornton had no exceptions to report in relation to the consistency of the Annual Governance Statement with the financial statements to their knowledge.

Once completed, the External Auditors’ Audit Completion Report would be circulated to all Committee Members. 

RESOLVED: That:

1)         the report be noted; and

2)         concerns about the incomplete audit be raised with the appropriate regulatory body by the Chairman and Assistant Director Resources.

Prior to the introduction of the internal audit report, the Chairman welcomed Gerry Palmer, Procurement Business Partnership Manager, Wealden District Council to the meeting, who provided Members with an update on the East Sussex Procurement Hub.

The internal audit had found that there was no up-to-date procurement strategy (an issue first raised at the last audit in August 2015) and no service level agreement (SLA) in place to formalise the current arrangements with the East Sussex Procurement Hub (ESPH).  A benchmark assessment against each of the key elements of the National Procurement Strategy for Local Government had been completed by the ESPH and council officers and the outcome had been received in February 2019.  The Procurement Strategy was being updated and consultation with officers and Members was due to take place over the following months in the form of workshops to be held in the Town Hall, with the revised strategy being presented to Cabinet in September 2019.  In addition, a revised SLA was anticipated to be ready for consultation in July 2019.

The Audit Manager led Members through the internal audit report to 31 March 2019.  The Council was required to ensure that it had reliable and effective internal control systems in place and the adequacy of these systems was tested by both Internal and External Audit.

The report included an annual report on the performance of the Internal Audit Service.  In the year up to 31 March 2019, Internal Audit had operated in accordance with the Public Sector Internal Audit Standards (hereafter referred to as ‘the Standards’). It was a requirement of the Standards that a report was made to the Audit and Standards Committee on audit matters and any emerging issues, not only in relation to audit but risk management and corporate governance.

The Internal Audit team had successfully completed the majority of the work for 2018/19; however, work on one audit (Software Licensing) was still ongoing at the year end and two other audits (Acquisition & Financial Management of ICT Facilities and Catering - Colonnade Café/Restaurant) did not proceed because the work was either covered elsewhere or no longer required.

The report gave details of the nine audits completed in the final quarter, a summary of all audit reports completed in 2018/19 and progress made on implementing audit recommendations.  Seven of these had provided good or substantial assurance on the overall governance arrangements. However, the other two audits (Benefits – Finance Extract and Creditors) only provided limited assurance due to problems with the introduction of a new computer system and the long term absence of a key member of staff.  Members requested that an update be provided to the Committee at the September meeting.

An overview of the findings arising from all nine audits was given in Appendix A to the report.

Appendix B to the report provided a summary of all audit reports completed in 2018/19, the level of compliance and assurance rating for each review, and the overall performance of the Internal Audit team against the plan. The details of all audit reports issued in the first three quarters of 2018/19 have already been reported to the Committee at previous meetings.

Appendix C to the report provided a summary of progress made on implementing the audit recommendations reported at previous meetings.  It was reported that most of the long outstanding recommendations had been cleared and only three 2017/18 recommendations were yet to be fully resolved. Good progress also continued to be made on the more recent recommendations.

The Audit Manager had been requested by Members at previous meetings to provide a progress update on the following items:

•   Public Conveniences Cleaning Contract – The audit report (issued in July 2018) received a limited rating because the contract paperwork (i.e. signed contract and performance bond) had still not been finalised at the time of the audit despite the contract having been in operation since April 2017.  Both documents had since been obtained as a result of management pressure on the East Sussex Procurement Hub and the contractor (Specialist Hygiene Services Ltd) to resolve the issue. The signed contract was eventually obtained in January 2019 and the performance bond in April 2019.

•     Homelessness Prevention Grants and Loans – The audit was a follow up review of the 2017/18 audit which only received a minimal assurance rating owing to the major control weaknesses found and the discovery of a £12,250 fraud. Whilst some progress had been made to improve procedures since that audit, the latest report still received a negative (limited) assurance rating because the new controls were not being consistently applied and management oversight was still found to be inadequate.   The Head of Housing and Community provided an update which gave assurance that financial controls are now being followed and that management are overseeing the process.

In addition to compliance work, the Audit Manager also coordinated the National Fraud Initiative (NFI) data matching exercises and the whole Internal Audit team assisted with the process of reviewing the matches.  The NFI matched Council data both nationally (to other public sector organisations) and locally (between the authority’s own records) to help prevent and detect fraud.  The national data match took place once every two years and was last carried out in October 2018.  The majority of the matches found (87%) related to housing benefit/council tax reduction cases and needed to be reviewed by the Revenues & Benefits team to either be dealt with in-house or referred to the Department for Work and Pensions for further investigation.

The local data match exercise was carried out every December; it’s primary purpose was to identify council tax payers who were wrongly claiming single person discount. The December 2017 review was completed during 2018/19 and had identified 12 errors resulting in £46,736 in savings. Work on the December 2018 matches was currently underway.

The Internal Audit team had also carried out some Counter Fraud duties during 2018/19.  This work primarily focused on council tax and business rates and a number of properties were identified which were either wrongly classified as empty, were in receipt of rate relief they were not entitled to, or required banding/rating by the Valuation Office. This work also uncovered several holiday lets which had not been declared. These cases were followed up with the help of colleagues in the Revenues & Benefits team and an additional £76,095 of revenue income was being collected as a result.

Internal Audit has also secured £20,000 of former Department for Communities and Local Government funding from the East Sussex Counter Fraud Hub for use on counter fraud initiatives. Negotiations were underway with Hastings Borough Council with a view to using the money to jointly fund a fixed-term Investigator post to enhance the Council’s capacity in this area.  However, it was likely that alternative uses of funding would need to be explored and the Audit Manager would report back to the Committee in due course.

Routine audit work during 2018/19 had also identified £43,897 in confirmed savings/extra income due to financial errors, which included a Section 106 debt which had been underpaid, business rate relief which had been wrongly applied and other debts which had not been billed.

The Audit Manager was pleased to report that evaluation of the Internal Audit team’s conformance with the Standards, to assess the efficiency and effectiveness of the service had concluded that there was a high level of overall effectiveness.  The team’s first external peer review was completed in April 2017; no significant issues were found. Quality assurance questionnaires were also used to capture client feedback, the vast majority of which had been very positive indicating a high level of satisfaction with the quality of the Internal Audit Service.

Internal Performance Measures set for the Audit Team also demonstrated that most of the targets for 2018/19 had either been met or exceeded. 

The summary of completed audits showed that six audit reports were given a limited or minimal assurance rating.  Whilst this appeared to be a disappointing result when compared to the previous year, Members noted that several of the areas reviewed faced a particularly challenging year owing to either the implementation of a major new computer system (Unit4 Business World) or increased demand as a result of changes in Housing legislation.  Only five of the 85 control objectives examined during the year was not “met” at least in part, and two of the affected audits (Benefits - Finance Extract and Public Conveniences Cleaning Contract) only received a limited assurance rating because of a specific issue which had since been resolved.

It was requested and agreed that officers would provide an update on the Unit 4 Systems Administration and that the Audit Manager would report back on the Whistleblowing policy.

Taking into account all the factors within the report and the routine quarterly reports, it was confirmed that the Audit Manager’s overall opinion on the Council’s framework of governance, risk management and control was that it was adequate and effective.

RESOLVED: That:

1)         the Internal Audit report to 31 March 2019 be noted;

2)         the Audit Manager’s opinion on the control environment be approved; and

3)         updates on the Unit 4 Systems Administration and the Whistleblowing policy be added to the Work Programme.

A request had been received from Light Up Bexhill Community Interest Company (LUBCIC) for a grant of £5,000 towards the cost of delivering a Victory in Europe (VE) Day celebration event on the De La Warr Pavilion lawns on 8 May 2020 (VE Day). 

LUBCIC was a ‘not for profit’ organisation consisting of three Directors, two of which were Rother District Councillors.  The objective of LUBCIC was to provide Christmas Lights and festivities in Bexhill.  The report outlined the planned celebratory events and breakdown of expected costs which totalled £6,630.

Cabinet had previously agreed to ring-fence £10,000 from the Council’s Community Grant Scheme (CGS) budget to match fund small grants up to £500 for VE Day celebrations.  Members were advised that additional funding of £18,000 was available through the Rother Visitor Events (RVE) budget.  The fund was open Rother wide and bids were encouraged between £250 and £2,000.  It was noted that LUBCIC’s application did not meet the criteria for either schemes.  Therefore the following options were available for consideration:

·       up to £5,000 from the Medium Term Financial Plan (MTFP);

·       up to £2,500 (50% of grant request) from (MTFP);

·       £500 from VE Day CGS; or

·       up to £2,000 from RVE scheme.

After consideration, Cabinet agreed to support the event by awarding a grant of £2,000 from the VE Day CGS that had sufficient funds remaining, subject to the following conditions being met:

·       evidence of the total costs for the day were provided;

·       a full risk assessment was completed (submitted) and been agreed as satisfactory;

·       evidence of event insurance cover was submitted; and

·       evidence of sponsorship or further funding to cover any shortfall.

RESOLVED: That funding of up to £2,000 be offered from the Rother VE Day Community Grant Scheme, subject to the conditions set out above.

(Councillor Mrs Bayliss declared a personal and prejudicial interest in this matter in so far as she was a Sponsor of Light Up Bexhill Community Interest Company and in accordance with the Members’ Code of Conduct left the room during the consideration thereof).

(Councillors Byrne and Timpe each declared a personal and prejudicial interest in this matter in so far as they were Directors of Light Up Bexhill Community Interest Company and in accordance with the Members’ Code of Conduct left the room during the consideration thereof).

(Councillor Madeley declared a personal and prejudicial interest in this matter in so far as she was a Member of Light Up Bexhill and in accordance with the Members’ Code of Conduct left the room during the consideration thereof).

Cabinet received and considered Minute PL19/117 arising from the meeting of the Planning Committee held on 13 February 2020 that had considered the revised Probity in Planning Advice for Councillors and Officers making planning decisions issued by the Local Government Association and Planning Advisory Services. 

The revised guidance reflected on changes to legislation and the 2019 National Planning Policy Framework.  It clarified how Councillors could get involved in planning discussions on plan making and on applications, on behalf of their communities, in a fair, impartial and transparent way.  Three areas were specifically highlighted, as the advice had significantly changed or been updated, namely how Councillors dealt with social media; predisposition, predetermination or bias; and the role of legal support. 

A Member of the Planning Committee raised concern that the Cabinet Portfolio Holder for Strategic Planning was also the Chairman of the Planning Committee which gave rise to a potential conflict of interest and went against the guidance.  It was noted that the guidance advised that in smaller Councils it was acceptable for Cabinet Portfolio Holders to be on the Planning Committee and exercise caution regarding possible conflicts of interest.

The purpose of the guide was to assist Members in their community engagement role whilst making good standards of probity.  It was recommended that the guidance be adopted and incorporated into the Council’s Constitution.

RECOMMENDED: That the best practice advice ‘Probity in Planning: for Councillors and officers’ second revised edition 2019 be adopted as guidance and incorporated into the Council’s Constitution.

The High Weald Area of Outstanding Natural Beauty (AONB) Partnership, which included the 15 local authorities with land in the AONB, had prepared a Design Guide for new housing development in the High Weald to support the objectives of High Weald AONB Management Plan 2019-2024, adopted by this Council in February 2019.

The Housing Design Guide aimed to give succinct, practical and consistent advice to set clear design expectations for new housing development within the High Weald AONB.  This would help to ensure higher quality and landscape-led design that reflected intrinsic High Weald character, and was embedded with a true sense of place, without stifling innovation and creativity.  It was noted that whilst the Design Guide was not a formal planning policy document as such, it would be a material consideration in relation to planning policy and the determination of planning applications.  It was considered by some Members that the Housing Design Guide did not go far enough to reinforce the need for sustainability policies.

The Housing Design Guide aligned well with the adopted Rother Local Plan Core Strategy, in particular – Policy EN3: Design Quality.  The Guide would help support this Council’s various roles in the planning process, from Plan-Making, through to Neighbourhood Plan liaison, and the Development Management process, helping to successfully deliver housing requirements and meet National Planning Policy Framework and Core Strategy policy objectives.  Following adoption, it was intended that the Design Guide would be promoted on the Council’s website, circulated directly to Parish and Town Councils and Neighbourhood Planning groups, and to housing developers working in the district. 

It was considered that the High Weald AONB Housing Design Guide was a supportable and appropriate framework for considering housing design in the AONB and could be adopted as a material consideration in the determination of planning applications. 

RECOMMENDED: That the High Weald Area of Outstanding Natural Beauty Housing Design Guide be formally adopted as a material consideration in the determination of planning applications.

The Council’s Community Grant Scheme (CGS) made provision for up to £130,000 per annum to be made available to community groups or organisations that met the specific grant criteria of the Scheme.  In September 2019, Cabinet awarded a total grant of £67,541 including £500 through the Small Grants Scheme, £10,000 towards Victory in Europe Day celebratory events and £15,000 towards the Healthy Aging and Innovation in Rural Europe project.  Therefore the opening balance of the Rother CGS was £36,959.  Round 2 for 2019/20 closed on the 15 January 2020; 11 applications had been recommended for approval, subject to specific conditions as detailed within the report.

Cabinet was reminded that conditions were applied when awarding grants; specifically, that full funding was required to be obtained in advance of any Rother payments being made and that Rother District Council was acknowledged in any publicity and promotional material associated with any project.  It was noted that the total amount committed from the overall budget would be £171,008, an overspend of £41,008.  After discussion, Cabinet approved all 11 grants and agreed that the shortfall be funded from the Medium Term Financial Plan earmarked reserves.  It was noted that the final shortfall may be less than the £41,008 as not all projects would proceed to delivery and completion.

Members thanked the officers and Panel members for their work in supporting the community grants process.  It was noted that the level of match-funding brought into the projects as a result of this Council’s funding was calculated every year and this information would be made available to Members in due course.  

Members were also keen to explore alternative funding methods such as a local lottery, use of local Community Infrastructure Levy (CIL) money or crowd funding and tasked the Community Grants Panel to consider these other options and report back to the CIL Steering Group and ultimately Cabinet in due course.

RESOLVED: That:

1)    the Community Grants listed below, as recommended by the Grants Panel be approved, subject to specific conditions relating to each application:

Battle Community Singers – £1,400

Battle Memorial Hall – £4,000

Camber Parish Council – £29,340

Hastings & Rother Furniture Service – £7,350

Robertsbridge Cricket Club – £10,000

Stonegate Village Hall – £6,000

St. James The Great Church – £5,000

Strandliners – £877

The Archive Resource Centre, Pett Village Hall – £3,000

Camber Memorial Hall – £5,000

Battle Local Action Planning Group – £5,000;

2)    should each application proceed to delivery and completion, any resulting shortfall be funded from the Medium Term Financial Plan earmarked reserve; and

3)    the Community Grants Panel be requested to review the Community Grants Scheme and consider alternative funding methods such as a local lottery, use of local Community Infrastructure Levy money or crowd funding and report back to the CIL Steering Group and ultimately Cabinet in due course.

(Councillor Mrs Cook declared a personal interest in this matter in so far as she was involved with the Battle Community Singers and in accordance with the Members’ Code of Conduct remained in the room during consideration thereof).

Members received and considered the report of the Executive Directors on the Revenue Budget and Capital Programme Monitoring Quarter 3 2019/20.  The report contained details of the significant variations of the Revenue Budget and updated Capital Programme.

Since the last report to Cabinet, there had been one reportable virement following a review of the Council’s capital expenditure financing requirement. 

Overall the cost of services identified a deficit of £698,000 which represented a decrease of £390,000 from the Quarter 2 forecast reported in November 2019.  The voluntary redundancy programme was likely to cost in the region of £450,000 to £500,000 but would deliver on-going savings in excess of this amount.  If these costs were incurred in the 2019/20 financial year they would be additional to the £698,000 above.   

The main reasons for the variations since the last forecast report were attributed to additional income from the Community Infrastructure Levy administration, Land Charges and rent income as well as lower than anticipated spend on waste services, homelessness, staff vacancies and Housing Benefit payments recovered from the Department for Work and Pensions. However these reductions were offset by further spending in respect of legal costs for planning appeals, payroll consultancy costs, the replacement of broken play equipment in Rye and accountancy restructuring costs.

Investment returns were in-line with the budget although the final year end position would depend on treasury management and property investment decisions made between now and finalising the financial year accounts. Reserves would be used to meet £650,000 of capital expenditure; which was a small reduction of £46,000 compared to the last forecast.  Delays in acquiring properties under the Property Investment Strategy had reduced the anticipated level of external borrowing, which in turn reduced the amount required to be set aside for the Minimum Revenue Provision by £428,000.

The council tax part of the Collection Fund was currently forecast to be in surplus by £744,000 at year end and Rother’s share was estimated to be £91,000. This has been reflected in the 2020/21 budget.

Business rates were forecast to be in surplus of £1.8m by year end and Rother’s share was estimated to be £758,000. This had also been reflected in the 2020/21 budget.

Capital spend to the end of December 2019 totalled £13.6m which included the purchase of the freehold of Market Square, Battle, as identified in Appendix A to the report.

Monitoring spend and income would continue in order to mitigate additional costs and its impact on the Council’s reserves.

RESOLVED: That the report be noted.

At Cabinet’s last meeting consideration was given to a comprehensive report on the background and progress made to date to bring forward a complex project of the redevelopment of the existing leisure facilities in Bexhill.  Cabinet had resolved to defer the matter until the Bexhill Leisure Centre Steering Group had met to consider the project in more detail.  Their findings would be reported to Cabinet in April 2020.

The decision had subsequently been called-in by the Overview and Scrutiny Committee and considered at its meeting on 26 February 2020.  A copy of the report and Minute arising from this meeting had been circulated to Members of Cabinet for their reconsideration.

The Chairman of the Overview and Scrutiny Committee, Councillor Osborne, addressed Cabinet and reported that the Scrutiny Committee had conducted a review of the decision and requested that Cabinet reconsider its previous decision for the following reasons:

·        land ownership issues were still prevalent and that access rights were still to be settled;

·        the whole project and, in particular, the housing element had, as a consequence of the decision been delayed by Cabinet’s decision to defer the recommendations.  The Council’s lack of a current 5-year supply of land for housing was significant and cause for concern;

·        further delays opened the project up to increased costs and risks; and

·        consideration be given to extending an invitation to Councillor Carroll to join the Steering Group.

The Leader thanked the OSC for their consideration of the decision made by Cabinet.  Through the call-in process it had become apparent that there had been some Cabinet Member confusion over what had been resolved at the previous meeting.  Cabinet confirmed that it had intended to agree an extension to the Bexhill Leisure Centre and Bexhill Leisure Pool contracts to secure continued operation of the existing facilities from 1 April 2021 and that the Compulsory Purchase Order process be commenced.  Cabinet did not agree however that Councillor Carroll be invited to join the Steering Group.  The Leader hoped that all Members would take an interest in this important Project and attend meetings of the Steering Group in any event. 

RESOLVED: That project progress be noted and the Executive Director, in consultation with the Cabinet Portfolio Holder for Safer Communities and Communications, Young People, Sport and Leisure, be granted delegated authority to:

1)     agree an extension of the Bexhill Leisure Centre and Bexhill Leisure Pool contracts to secure continued operation of the existing facilities from 1 April 2021 up to the planned closure, of each centre;

2)     begin the Compulsory Purchase Order process for land at the former high school site and access, subject to a full report to follow;

3)     establish a Bexhill Leisure Centre Steering Group as per the Terms of Reference attached at Appendix 5 (to the original report dated 10 February 2020); and

4)     that further progression of the project be deferred (save for recommendations 1, 2 and 3 above) and referred to the Bexhill Leisure Centre Steering Group for recommendation to Cabinet in April 2020 and the following recommendations from the original report dated 10 February NOT be supported at the current time:

Recommendation to COUNCIL: That £5m from either the Strategic Community Infrastructure Levy fund or borrowing (subject to affordability) or other funding sources be allocated to this project, noting the overall funding approach set out at Appendix 3; and that the Capital Programme be updated for the estimated costs and funding as detailed in the report; and

3) to appoint an Employer’s Agent and an Architect to carry out detailed design work and preparation of a reserved matters application to be funded from capital project budget previously committed.

(Councillors J. Barnes, Clark, Mrs Earl-Williams, Field and Maynard each declared a personal interest in this matter in so far as they were elected Members of East Sussex County Council and in accordance with the Members’ Code of Conduct remained in the room during consideration thereof).

(This executive decision is not subject to call-in procedure under Rule 16 of the Overview and Scrutiny Procedure Rules as it has already been subject to the call-in procedure).