10:58AM, Thursday 26 September 2019
A damning report of the council’s finances, seen by the Advertiser, has found problems that need to be resolved ‘urgently’.
The Chartered Institute of Public Finance and Accountancy (CIPFA), an accountancy body dedicated to public finance, has recommended a ‘detailed review of the way financial management operates within the Royal Borough… as a matter of urgency’.
Measures ensuring the council complies with ‘all applicable local government financial legislation’ should be put in place and a review of the council’s ‘financial resilience’ should be undertaken, CIPFA found.
The report has been sent to councillors, marked ‘confidential’.
It states that CIPFA was asked by managing director Duncan Sharkey to review the £350,000 Clewer and Dedworth Neighbourhood Improvements scheme, a series of road repairs in the west of Windsor.
The report states that Mr Sharkey was ‘concerned that the scheme did not appear to meet the council’s overall objectives’ and that it had no business case or plan which set out what the scheme would deliver, or how it would be managed, before the spending was approved.
“(The) issues raised highlighted further concerns about financial monitoring in the council, as well as the effectiveness of financial governance and the role of the finance function in overseeing the financial governance of the council,” said the CIPFA report.
In a series of conclusions, it found:
W The council budgets set for 2018/19 and 2019/20 ‘did not include a statement on the robustness of estimates and level of reserves and therefore they did not comply with the requirements of the Local Government Act 2003’.
W The council’s medium-term financial planning process ‘is limited’ and that, while just over £4million of savings are needed for 2020/21, ‘no explanation is given of how these will be achieved’.
W The council’s reserves are low in comparison to other unitary authorities which ‘represent a risk to ongoing sustainability if unforeseen events occur’.
W An error in a spreadsheet estimating the cost of debt charges in the council’s medium-term financial plan could ‘lead to a £700,000 budget shortfall in 2020/21’.
W The £48,000 of spending charged to the Clewer and Dedworth Neighbourhood Improvement scheme ‘appears to be ultra vires’ – a legal term for beyond the scope of an authority’s power.
W Councillors were apparently ‘able to circumvent the council’s approved policy framework’ to add schemes in the capital spending programme without officers being able to challenge them.
Cllr David Hilton (Con, Ascot and Sunninghill), lead member for finance, who was one of the councillors interviewed for the report, told the Advertiser that the Clewer and Dedworth scheme issue was an outlier, and the council had been in control of spending because spending requests come to cabinet, which reviews it and then decides how much to spend in-year.
He accepted the report’s conclusions and its recommendations were ‘absolutely what we are working on’. He added that he ‘can only talk about the future’ which will see the council adopt a ‘much more robust’ approach to its finances.
He said the council is working with CIPFA to change its financial processes.
But Cllr Simon Werner (Lib Dem, Pinkneys Green), the Lib Dem leader, said he was not confident the new leadership (see p5) could turn around what he called the ‘Conservative cash crisis’.
He said he felt relief “that what I have been saying for the last two years is being recognised. It is being confirmed by an independent body”.
A council spokeswoman said: “Over August we asked CIPFA to come in to carry out some work to give us more capacity.
“We’ve agreed to extend that work so CIPFA will be working alongside the Finance Team through to December.
“This is to support the team with developing our financial strategy and delivery. They have produced a report following their work in August which sets out some recommendations.”
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