Agenda and minutes

Councillor Callum Bailey (personal)

None.

Minutes of the meeting held on 18 October 2024, for confirmation.

The minutes of the meeting held on 18 October 2024 were confirmed as true record and signed by the Chair.

Report of the Chief Fire Officer

Bev Bull, Head of Finance and Treasurer to the Authority, presented the report which provides an update to the committee on the 2024-25 financial performance of the Service to the end of November 2024, including monitoring of Prudential Indicators.

The report provides detailed information on the following;

a)  a summary of expenditure and funding, including the £1.244m underspend;

b)  commentary on the following budget variances;

  i.  employee in costs underspend of £881k

  ii.  premises costs, underspend £368k;

  iii.  transport -related costs, overspend £306k;

  iv.  supplies and services, overspend £329k;

  v.  third party, overspend of £90k;

  vi.  support services, underspend of £23k;

  vii.  capital financing costs, underspend of £486k;

  viii.  sales, fees, and charges, under achieved income of £139k;

  ix.  other income, overachieved income of £350k;

c)  target efficiency savings are listed in Table 2 of the report, including newly identified savings, which, if achieved, will provide an additional £11k;

d)  the current and anticipated levels of earmarked reserves are outlined in Table 3 of the report, and it is predicted that the general reserve will total £5.083m by the end of the financial year;

e)  the Capital Programme budgets, activity, and forecasts are presented in Tables 4 and 5 of the report, accompanied by narrative, including adjustments due to an expenditure being incorrectly accrued in a previous year;

f)  a detailed narrative of Capital Programme Net Slippage and Acceleration is provided in paragraph 2.27 of the report;

g)  areas of Capital Programme over and underspend since last reported in August 2024 are identified in paragraph 2.28 of the report. This specifically relates to £357k underspend to Estates Energy Reduction and Decarbonisation TO (this grant will be returned), and an overspend of £18k on ICT and Communications;

h)   Prudential Code Monitoring is presented in Table 6 of the report, and whilst at this stage in the financial year indicators are mainly in line with agreed levels, it is noted that a precise overview will not be available until the year end.

Members’ questions were responded to as follows:

i)  the Service did not lose money when the contractors for the ‘access and inclusion’ contract went into administration, but the Service has made a claim to the administrators as a new contractor will need to found;

j)  the ‘On-Call’ pay budget is difficult to accurately determine as it is dependant on the number of incidents requiring on-call staff, meaning that fewer incidents result in lower costs. The Service is currently implementing the national position of a retained fee and payment for the number of hours worked. There is potential for fluctuation, for which must be provided for in the budget;

k)  the ‘Whole-Time’ pay budget is underspent as the Service took a cautious approach to recruitment due to the unknown figure of the yearly settlement from Central Government. A multi-year settlement would be helpful for longer term planning, particularly as it takes several months to recruit and train firefighters before they can become operational.

Resolved to:

1)  note the contents of the report;

2)  approve the slippage and acceleration in the capital programme into/from 2025/26 as detailed in Section 2.27 and Appendix B of the report;

3)  approve the forecasted capital programme over / underspends as set out in Section 2.28 of the report.

Report of the Chief Fire Officer

Bev Bull, Head of Finance and Treasurer to the Authority, presented the report which tasks members of the committee with identifying a preferred council tax option to recommend to the full Fire Authority. Members were also asked to consider and discuss pay award assumptions for the final 2025/26 budget.

The report provides a narrative overview of the potential budgets compared to previous years and projected into 2028/2029, and presents members with three options from which to select a council tax approach for 2025/26, with details on how each option would impact the Service’s budget in 2025/26 and ongoing years.

The three options presented to the committee are as follows:

1  to accept a service budget deficit with a nil Council Tax rise;

2  to apply a 2.95% Council Tax increase in all years;

3  to a ply a £5 Council Tax increase (to property band D, pro rata) in 2025/26 and a 2.95% increase in all following years.

It was emphasised that whatever the final decision of the Authority for 2025/26, that the amount received in next financial year’s Council Tax precept would be in the base for following year’s potential income and budget deficits.

With regard to pay award assumptions, Mick Sharman, Assistant Chief Fire Officer, informed the committee that there are significant factors to take into consideration, including the change in leadership of the Secretariat. The FBU has written to the Local Government Association’s National Joint Council requesting further consultation. Most Authorities are presuming a 2% pay rise for the uniform staff a contingency is included in the budget that would allow for an additional 1% pay award. The Chief Fire Officer and Head of Finance and Treasurer to the Authority have been consulted on pay rise affordability, but it is likely that other sector pay rises will have an influence.

Resolved

1)  that having considered the budget proposals for 2025/26 to 2028/29, and the proposed council tax options set out within the report, the committee unanimously recommends that the Fire Authority approves the implementation of option 3, to apply a £5 pounds Council Tax increase (to band D property pro rata) in 2025/26 and a 2.95% increase in all following years;

2)  that with regard to the pay award assumptions for the final 2025/26 budget, the committee supported the budgetary assumption of a 2% pay award for uniform staff and 3% pay award for support staff for 2025/26. n.

Report of the Treasurer to the Authority

Bev Bull, Head of Finance and Treasurer to the Authority, presented the report which provides an update on the final audited statement of accounts for 2021/22 and 2022/23, noting that the accounts were signed on 5 December 2024.

Resolved to:

1)  note that the Final Statement of Accounts for 2021/22 and 2022/23 were signed and published by the statutory backstop date;

2)  note the Final Audit Completion Report for 2021/22 and 2022/23 enclosed at Appendix A to the report.

Report of the Treasurer to the Authority

Bev Bull, Head of Finance and Treasurer to the Authority, introduced the report which presents Members with the Statement of Accounts for 2023/24 and requests approval for the signing of the 2023/24 accounts to enable publication of the final Statement of Accounts by the backstop date of 28 February 2025.

Bev Bull offered to meet with Councillors in person at any time during the year, if they wished to discuss any specific areas of the Accounts.

Resolved

1)  to note that the audited Statement of Accounts 2023/24 as attached at Appendix A to the report;

2)  to delegated authority to the Head of Finance (Section 151 Officer) and the Chair of the Finance and Resources Committee to sign the final Statement of Accounts 2023/24;

3)  that any changes to the 2023/24 accounts are presented to the next Finance and Resources Committee.

Report of the Treasurer to the Authority

Richard Walton, Director of KPMG LLP External Auditor, presented the Draft Audit Completion Report. Points highlighted included:

a)  whilst the first KPMG appended report is issued to the Authority as ‘those tasked with Governance’, the second report is specific to Local Authority audits for public issue on the Service’s website, alongside the accounts at a later date;

b)  the last completed financial detailed audit of the Service was undertaken in 2021, but due to NFRS having a ‘disclaimed’ audit opinion for the financial years 2021/22 and 2022/23, KPMG have had no alternative other than to issue a further ‘disclaimed’ audit opinion, as the starting point information is yet to be confirmed;

c)  in normal circumstances a disclaimed opinion would be issued if something has had gone wrong, but this is not the case for NFRS, and relates to the national circumstances of the financial audit back logs. The Service is not alone in late completions, with multiple Local Authorities in the same position. Central Government has emphasised that this should not be considered to the detriment of Authorities;

d)  it is anticipated that the national Auditing Schedule will comply to the original timescales within 2-3 years, through the ‘reset, recovery, and reform’ programme established by Central Government and the Financial Reporting Council, a result of which will be the ability to issue definite audit opinions;

e)  Page 6 of the ‘End of Year’ audit report provides a summary of the audit findings with regard to risk, for which detailed narrative is provided within the KPMG report:

  i.  Significant audit risks

o  management override of controls,

o  evaluation of post-retirement benefit obligations, (no concerns raised),

o  valuation of land and buildings;

  ii.  other audit risks

o  valuation of land building;

  iii.  uncorrected audit differences

o  defined benefit asset;

  iv.  number of control deficiencies

o  bank reconciliation;

f)  some areas of the audit are still outstanding at this point in time, but will be completed and an opinion issued by the end of February;

(f)  5 areas of audit misstatements were identified and are explained in page 14 of the KPMG report, but none are of particular concern at this time;

g)  one area hasn’t been amended regarding pension accounting as it is below the materiality threshold for a required amendment;

h)  page 19 provides a summary of Value For Money work, followed by a more detailed narrative, no areas of significant concern were identified;

i)  Audit Recommendations are made within the KPMG audit report, but none are considered significant.

In response to members questions:

j)  it was noted that the ‘estimates’ point regarding pension costs is an unknown, but is reasonably assumed within accepted boundaries, so is considered neutral. Actuaries can pose alternative presumptions, but the true figures cannot yet be determined.

Resolved:

1)  to note the contents of the External Auditors Draft Completion Report as attached at Appendix A to the report:

2)  to grant delegated authority to the Head of Finance (Section 151 Officer) and the Chair of the Finance and Resources Committee to approve the External Auditors Final Completion Report for 2023/24;

3)  for the Final Completion Report and any final changes to 2023/24 Statement of Accounts to be presented to the next Finance and Resources Committee.

Report of the Chief Fire Officer

Andrew Howarth, Internal Auditor from Nottinghamshire County Council, presented the Internal Audit progress report which outlined the 6 audits for this year, all of which are on track for completion as planned.

The following points were highlighted:

a)  the ‘procurement of goods and services’ audit is complete and presented to the committee as an appendix to the report;

b)  the ‘data protection’ audit was in draft form at the time of agenda publication, but has since been completed and will be presented to the next committee;

c)  the ‘Replacement Mobilisation System (RMS)’ audit has been delayed until the end of February due to an RMS project officer post being vacant;

d)  the Fire Standards Board, ‘Leading the Service’ standard audit will start a week on Monday;

e)  ‘On-call Firefighter remuneration rostering system’ audit has started;

f)  the ‘Corporate Governance’ audit is being scoped and will be completed by the end of March;

g)  the procurement report was issued with ‘reasonable assurance’ with recommendations issued in the following areas, the detail of which is set out in the report with a detailed narrative;

  i.  Single Source Supplier Forms (Priority 1 Area)

  ii.  Financial Regulations and Procedures (Priority 2 Area)

  iii.  Contract Register (Priority 2 Area)

  iv.  Procurement Planning for New and Expiring Contracts (Priority 2 Area)

  v.  Electronic Procurement (Priority 2 Area)

  vi.  Signed Contracts (Priority 2 Area)

  vii.  Staff Procurement Training (Priority 2 Area)

h)  as agreed last year by the Fire and Rescue Authority, the committee is tasked with monitoring the progress against the recommendations of last year’s ‘contract management ‘audit. Appendix 2 to the report provides the update on progress against the audit recommendations, including the latest action taken of boosting resources within the team which will increase the pace of progress;

i)  members of the committee were assured that training sessions are being held with individual mangers to support targeted learning both in specific areas and roles, but also more broadly. Supporting documented guidance is provided along with ensuring that staff are aware of the significance of the methodology of the processes and the implications of not following the processes.

Resolved to note the report.

To consider excluding the public from the meeting during consideration of the remaining items in accordance with Section 100A of the Local Government Act 1972, under Schedule 12A, Part 1, on the basis that, having regard to all the circumstances, the public interest in maintaining an exemption outweighs the public interest in disclosing the information

Resolved to exclude the public from the meeting during consideration of the remaining item in accordance with Section 100A of the Local Government Act 1972, under Schedule 12A, Part 1, Paragraph 3, on the basis that, having regard to all the circumstances, the public interest in maintaining an exemption outweighs the public interest in disclosing the information.

Report of the Chief Fire Officer

Mick Sharman, Assistant Chief Fire Officer, presented report.

Resolved to approve the recommendation as set out in the report.