Agenda item

Report of Acting Corporate Director for Resources

Shail Shah, Head of Internal Audit, introduced the report presenting the internal audit reports selected for detailed examination at the meeting of the Committee on 29 November 2013.

Bulwell St Mary’s Church of England School

Most of the arrangements in place within the school are considered satisfactory, providing adequate system of control but providing only limited assurance.

The following 3 high priority areas were recommended for improvement;

·  the standard of committee meeting minutes;

·  demonstrating best value in the procurement of goods and services;

·  authorisation for payment of invoices.

5 medium priority, and 3 low priority recommendations were also made.

It is noted that all recommendations have now been met.

Housing Rents 2013-14

Rent increases approved in 2014-15 make a useful step towards providing an income base that supports future expenditure. However concerns included:

·  the current level of rent convergence;

·  future rent setting;

·  the accuracy of the Housing Revenue Account 30 year business plan;

·  access control to the Northgate housing system.

4 high priority and 4 medium recommendations were made.

Although responses have been received from managers for all the recommendations made, few recommendations are yet to be fully met but confidence was expressed that colleagues would be able to resolve these issues.

John Slater, Principal Auditor, was also present to respond to the Committee’s questions:

(a)  Nottingham City Homes is able to borrow independently and build their own housing stock;

(b)  it is unlikely that the newly launched tenant incentive scheme will not cost as much as earlier reported;

(c)  arrangements are being developed that where homes become vacant, new tenancies should attract the target rent;

(d)  Council housing currently charges rents which are approximately 60% of the value of the current open market rent. The newly built houses offer affordable rents which are 80% of that on the open market;

Councillors comments included:

(e)  it is a concern that an £80 increase in rent is proposed over the next 5 years for council houses as this will encourage tenants to take advantage of the right to buy option;

(f)  the rent incentive scheme introduced this year has been fraught with difficulties;

(g)  it is a concern that the average private rented property in Nottingham is £25 per week more expensive than rented social housing when wages have effectively been reduced. This impacts most on the working poor;

(h)  it is a concern that the Housing Revenue Account is providing funds for new social housing when these properties are still eligible for tenants to purchase under the right to buy scheme;

(i)  with 500 council homes sold already this year through the right to buy scheme, it is vital that properties are selling for the highest possible price and that funds are recovered where any fraudulent activity is found;

(j)  50% of all right to buy applications proceed, the majority of properties being family homes as these are a sound investment;

(k)  analysis of the areas/wards where council homes are selling  has shown that values appear to vary significantly in different wards for the same build.

RESOLVED

(1)  to note the internal audit investigations and reports for Bulwell St Mary’s Church England Primary School and Housing Rents, agreeing that the audit work is of a high quality and scope;

(2)  that prior to any further audit reports being selected for detailed consideration by Audit Committee,  member training is arranged, by the Head of Internal Audit, potentially including:

(i)  further information on the Council Housing 'Right to Buy' scheme and the valuation process;

(ii)  the workplace levy;

(iii)  the tram.