THANET DISTRICT COUNCIL STATEMENT OF ACCOUNTS FOR THE YEAR ENDED MARCH 2007

Ref No	KEY ELEMENTS	INTERNAL CONTROL
3.1	Establishing and monitoring the achievement of the Authority's objectives. Establishing and monitoring the achievement of the authority's objectives (cont).	The Council's Corporate Plan sets out the Council's vision for Thanet and the overall objectives and priorities for 2003/07. It also outlines plans to achieve its goals and how progress against those goals is to be measured. The Council's updated Corporate Plan 2007/11 went to Cabinet (19 April 2007) as a draft and will be approved by Council in June 2007. The objectives have been developed through extensive consultation with Members, staff, residents and other stakeholders. The detailed action plans, which deliver the Corporate Plan priorities, are incorporated into the Council's Service Plans. Another key group of planning documents are the individual service plans. These set down each year the way that each service will contribute to the achievement of the Corporate Plan and fulfil its statutory functions. Both service plans and the Corporate Plan detail key projects and performance indicators, which are then monitored throughout the year. As part of the Local Strategic Partnership, the Council's Community Strategy includes a vision for the local area, based upon the aspirations, needs and priorities of the local community, a strategy for implementing that vision and regular monitoring to ensure the aims are being met. This strategy was launched in June 2004. The Best Value Performance Plan (BVPP) published annually in June sets out the Council's Corporate and Service priorities and is also used to report on the progress of the previous years priorities and targets. The Council has a number of supporting strategies that underpin the Corporate Plan, and these are: Thanet Crime & Disorder Strategy, Housing Strategy, Local Plan, Procurement Strategy, Medium Term Financial Strategy, Capital Investment Strategy, Treasury Management Strategy, Asset Management Strategy and the Risk Management Strategy. The delivery of the Council's Corporate and Service priorities is tracked through the monthly Performance Packs to Extended Corporate Management Team (ECMT) and Cabinet and the Quarterly Performance Packs, which go to Cabinet and the Finance Best Value Performance Review Panel (FBVPRP). An annual report is given through the BVPP. Council officers participate in a bi-annual appraisal, which sets annual work targets for each individual linked to their Service Plan, which is ultimately linked to the Corporate Plan.
3.2	The facilitation of policy and decision making.	The Council has adopted a Constitution for governance of Thanet District Council, which sets out how the Council operates, how decisions are made and the procedures which are followed, to ensure that these are efficient, transparent and accountable to local people. The Cabinet is the part of the Council that is responsible for most day-to-day decisions and is now made up of the Leader and 7 (after 11 11 May 2006) other Councillors. When key decisions are to be discussed or made these are published in the Council's Forward Plan and will generally be discussed in a meeting open to the public. The Cabinet has to make decisions that are in line with the Council's overall policies and budgets. Decisions outside the Budget and Policy Framework must be referred to Full Council. A “call in” procedure allows a Scrutiny Committee to review Cabinet decisions before they are implemented. The Council's Corporate Management Team (CMT), consisting of the three two Corporate Directors and the Chief Executive, meet on a monthly basis to consider strategic issues. They meet with Heads of Service monthly (ECMT) to consider operational issues. All draft Cabinet reports are reviewed by ECMT. Council agreed the creation expansion of thea Governance and Audit Committee on the 11 17 May 20062007 to improve its effectiveness. A Governance and Audit Committee is a key source of assurance about the Council's arrangement for managing risk, maintaining an effective control environment and reporting on financial and non-financial performance.
3.3	Ensuring compliance with established policies, procedures, laws and regulations. Ensuring compliance with established policies, procedures, laws and regulations (cont).	The Members handbook contains key controls and regulations including the Council's Constitution which encompasses: Council Procedure Rules Cabinet Procedure Rules Overview and Scrutiny Procedure Rules Financial Procedure Rules Contract Procedure Rules Code of Conduct for Members Officers' Code of Conduct Protocol on Member / Officer Relations Protocol for the Guidance of Planning Members and Officers. These documents are available on the Council's web site and officers can access the documents via the Council's intranet. The Constitution approved by Council approved a revised Constitution on 11 May 2006 is currently under review. The role of Monitoring Officer (represented at Corporate Director level) has responsibility for ensuring that agreed procedures are followed and that all applicable statutes, regulations and other relevant statements of good practice are complied with. The role of Section 151 Officer (represented at Corporate Director level ) up to December 2006. The role is currently being held by the Acting Financial Services Manager until the appointment of The Head of Financial Services in July 2007) has responsibility for ensuring that appropriate advice is given to the Authority on all financial matters, for keeping proper financial records and accounts and for maintaining an effective system of internal control. The Efficiency Review saw the transfer of Internal Audit provision to the East Kent Internal Audit Partnership. Based on a risk analysis, they review compliance with all applicable statutes, regulations and relevant statements of best practice and ensure that public funds are properly safeguarded and are used economically, efficiently and effectively. In November 2006, four months ahead of schedule, the Council achieved Level 2 is currently undertaking an assessment of its current position of the Equality Standard Standard for Local Government. Corporate and service level action plans for movement through the Standard in line with Council priorities and statutory obligations are currently being developed. This work is being taken forward by the Corporate Equalities Planning Group, which is composed of eight service level representatives and chaired by the Corporate Director, Paul Moore. The Council is now aiming to achieve Level 3 of the Equality standard by March 2009to ensure compliance with the requirements of the Race Relations (Amendment) Act 2000, the Disability Discrimination (Amended) Act 2005 and evolving equalities legislation. This will inform the development of a corporate and service level action plan for movement through the Standard in line with Council priorities and statutory obligations. A steering group - the Corporate Equalities Planning Group - formed of service representatives and chaired by Paul Moore, Corporate Director, has been formed to facilitate this work. The Public Interest Disclosure Act 1998 requires the Council to have in place a Whistleblowing procedure whereby staff and others can report concerns about various sorts of wrongdoing or alleged impropriety. The Council first adopted such "whistleblowing" provisions in 2000 and approved an updated Code in April 2005. The Whistleblowing Code is available to staff via the intranet and is referred to in the Induction Training Programme. The Code is also proactively communicated to those contracting with the Council. The Freedom of Information (FOI) Act gives a general right of access to see information held by public bodies except in narrowly prescribed circumstances. In response to this new legislation, the Council has produced guidance notes, appointed FOI department representatives, updated staff at staff development sessions and developed a central process to record all requests. The Council has appointed a Money Laundering Reporting Officer and guidance has been issued to all cash control staff/senior managers. The Anti-Money Laundering Policy went to ECMT and Finance, Best Value and Performance Review Panel in January 2006. In February 2006 Butlers (the Council's treasury advisors) held an Anti-Money Laundering staff training session. This, together with Whistleblowing procedures, was the subject of a Staff Development Session in May 2006. Anti-Money Laundering is also included within the induction training given to new staff. The Council has undertaken consultation with Thanet residents and neighbouring Authorities, with regard to the Kent International Airport Section 106 of the Town and Country Planning Act 1990 Planning Agreement. Feedback from that work, conducted in 2005, is being used to inform discussion with the current owner of the Airport, Infratil, on the content of the successor Planning Agreement. The purpose of which will be to enable the business to develop, and provide appropriate environmental protection. At present, Infratil are operating at a low level and progress is slow, pending classification of business expansion proposals.
3.4	How leadership is given to the risk management process.	The Council has a Member Risk Champion, in the Cabinet Portfolio holder for Improvement and Performance, and an Officer Champion in the Corporate Director to which Improvement and Performance reports. The Council first approved the revised Risk Management Policy and Strategy in February 2006. Directors, Head of Service (HOS), Finance, Best Value and Performance Review and Cabinet were all involved in the annual revision of the Strategy. The Strategy defines Roles and Responsibilities. In February 2007 the Corporate Governance Officer transferred into the Corporate Projects Team within Improvement and Performance, thereby creating stronger links with performance monitoring and policy roles. The role of this post was to deal with Governance issues including risk management and business continuity. The annual review of the Risk Management Policy and Strategy, including the risk management process, (as required within the Key Lines of Enquiry-Use of Resources), was approved by Council in February 2007. This was phase I, a more comprehensive review (phase II) will be taking place in the near future to improve upon the document and also the service planning process to coincide with the implementation of the web-based Risk Register database. Quarterly update reports were provided to the Governance and Audit Committee on Governance, risk management, business continuity and insurance matters.In October 2003, Risk Management became the responsibility of the S151 Officer. The Efficiency Review saw the transfer of Risk Management to Financial Services and from 1st April 2006 insurance was outsourced to KCC to release additional staff resource for Corporate Governance (including Risk Management). The Resources Portfolio Holder has been nominated as the Member Champion for Risk Management and the first meeting was held with him in February 2006. The Council approved the revised Risk Management Policy and Strategy in February 2006. Directors, HOS, Finance, Best Value and Performance Review and Cabinet were all involved in the annual revision of the Strategy. The Strategy defines Roles and Responsibilities.
3.5	How risk management is embedded in the activity of the Council. How risk management is embedded in the activity of the Council (cont).	In conjunction with the phase II review of the Council's Risk Management Policy, Strategy and risk management process, a review is also being undertaken of the Terms of Reference of the Corporate Risk Management Group to establish a suitable Group to consider all Governance related issues including risk management and business continuity. The 2006/07 Service Plan Template included a section for Risk Management and the information provided formed the basis of the revised Risk Register. This is the same for the 2007/08 Service Plans, and phase II of the Risk Management process review will develop a more robust process for the 2008/09 Service Plans. The Council has utilised risk management to help formulate its policy on the appropriate level for reserves. When considering budget bids, managers are asked to undertake a risk assessment and this is considered as part of the resource allocation methodology. The Council has purchased the Web-based version of the Corporate Risk Register database, and this is being rolled out to all risk and control measure owners. This will enable responsible Officers direct access to the system to undertake regular reviews. A Project Management toolkit has also been developed, and the risk management process has been incorporated into this system. From 2005/06, Managers Assurance Assessment Statements have supported the Statement on Internal Control to strengthen the process. Managers' answers to the series of questions will provide assurance and confidence to those signing the statement. In addition, where Managers have indicated risks in their Managers Assurance Assessment Statements, these will also be included in the Risk Register. The Council is currently engaging all staff in the Business Continuity Management process to ensure contingency planning is in place. Modules 1 to 3 of the training provided by Kent County Council have taken place, and module 4 is to be arranged shortly. The Council also provides advice to Small and Medium Enterprises, as is required through the Civil Contingencies Act, on it's Internet site and through leaflets that are sent out with Business Rate invoices. The Council maintains a Major Emergency Plan, detailing its corporate response to an emergency, including air incidents, as well as specific departmental plans dealing with: Homelessness as a result of an emergency Media relations during an emergency Emergencies at Ramsgate Royal Harbour Emergencies at Ramsgate New Port Emergencies at Broadstairs Harbour and Margate Harbour Coastal Storm Tide Flooding Oil Pollution Environmental Health emergencies Since 2004/05, all Council departments have completed annual work place risk assessments. The inaugural meeting of the new Corporate Risk Management Group led by the Corporate Director was held in March 2004. Following the Efficiency Review, the Corporate Risk Management Group members were revised and the first quarterly meeting with the new members was held in November 2005. Cabinet reports now include a section for consideration of risk issues. The 2006/07 Service Plan Template includes a section for Risk Management and the information provided will form the basis of the revised Risk Register. The Council has utilised risk management to help formulate its policy on the appropriate level for reserves. When considering budget bids, managers are asked to undertake a risk assessment and this is considered as part of the resource allocation methodology. To strengthen the process for the 2005/06 Final Accounts the Statement of Internal Control will be supported by Managers Assurance Assessment Statements. Managers' answers to the series of questions will provide assurance and confidence to those signing the statement. In addition, where Managers have indicated risks in their Managers Assurance Assessment Statements, these will also be included in the Risk Register. The Council is currently engaging all staff in the Business Continuity Management process to ensure contingency planning is in place and the first round of forms deadline was 1st June 2006. The Council maintains a Major Emergency Plan, detailing its corporate response to an emergency, as well as specific departmental plans dealing with: Homelessness as a result of an emergency Media relations during an emergency Emergencies at Ramsgate Royal Harbour Emergencies at Ramsgate New Port Emergencies at Broadstairs Harbour and Margate Harbour Coastal Storm Tide Flooding Oil Pollution Environmental Health emergencies Since 2004/05, all Council departments have completed annual work place risk assessments. This Council has worked to deliver its responsibilities under the Civil Contingencies Act.
3.6	How staff are trained or equipped to manage risk in a way, which is appropriate to the authority and their duties.	Since September 2004 the Authority has been developing a structured managerial development programme, which covers competencies in project management, business planning, performance management, risk and financial management, staff management and development and communication skills. The first round of officers have completed the course and been awarded their diplomas. Public Risk Management (PRM) in November 2005 carried out training in Risk Management and Business Continuity Planning. The Council entered into a contract with PRM to provide training workshops for managers and relevant staff during 2006/07 and the “way forward” workshop was held in April 2006. During these interactive sessions between PRM and Corporate Directors, Heads of Service and Service Managers the Council's Risk Register was developed. The training on the use of the RISKWeb system will assist Officers in taking direct responsibility for risks within the system that are linked to Corporate and Service Objectives. KCC provided Business Continuity Management (BCM) workshops for Managers in April/May 2006. The workshops gave a brief background to BCM and then walked managers through the completion of the Business Impact Assessment forms, and further training was provided on the completion of the Business Risk Analysis forms. The final module of the training on the Continuity of Business plans is to be arranged shortly, and further work will then be undertaken to pull the Corporate Business Continuity Plan together. Financial Services together with the new Corporate Communications and Marketing Department devised a communication plan for Risk Management. This helped to raise awareness and embed Risk Management and Business Continuity at all levels of the organisation. In particular, briefings were provided at the Staff Development Sessions and at the Management Conference in June 2006. Risk Management will also form part of the Thanet Manager programme. Financial Reporting Standard (FRS) 8 requires that the Financial Statement draws attention to the possibility that the reported financial position may have been affected by the existence of related parties and by material transactions with them. Members and relevant officers are requested to identify any such transactions. The Council keeps a gifts/hospitality register. Any gift or hospitality accepted by an officer must be reported to their line manager, a form completed and approved by their Director for inclusion within the register.Since September 2004 the Authority has been developing a structured managerial development programme, which covers competencies in project management, business planning, performance management, risk and financial management, staff management and development and communication skills. The first round of officers have completed the course and been awarded their diplomas. Public Risk Management (PRM) in November 2005 carried out training in Risk Management and Business Continuity Planning. The Council entered into a contract with PRM to provide training workshops for managers and relevant staff during 2006/07 and the “way forward” workshop was held in April 2006. KCC provided Business Continuity Management (BCM) workshops for Managers in April/May 2006. The workshop gave a brief background to BCM and then walked managers through the Service Continuity Plan Templates. Financial Services together with the new Corporate Communications and Marketing Department are devising a communication plan for Risk Management. This will help to raise awareness and embed Risk Management at all levels of the organisation. In particular, briefings will be provided at the Staff Development Sessions and at the Management Conference. Risk Management will also form part of the Thanet Manager programme. Financial Reporting Standard (FRS) 8 requires that the Financial Statement draws attention to the possibility that the reported financial position may have been affected by the existence of related parties and by material transactions with them. Members and relevant officers are requested to identify any such transactions. The Council keeps a gifts/hospitality register. Any gift or hospitality accepted by an officer must be reported to their line manager, a form completed and approved by their Director for inclusion within the register.
3.7	Ensuring the economical, effective and efficient use of resources and for securing continuous improvement in the way in which functions are exercised, having regard to a combination of economy, efficiency and effectiveness as required by the Best Value duty. Ensuring the economical, effective and efficient use of resources and for securing continuous improvement in the way in which functions are exercised having regard to a combination of economy, efficiency and effectiveness as required by the Best Value duty (cont). Ensuring the economical, effective and efficient use of resources and for securing continuous improvement in the way in which functions are exercised having regard to a combination of economy, efficiency and effectiveness as required by the Best Value duty (cont).	The Council has a rigorous budget setting process. This is under pinned by a four year Medium Term Financial Strategy. There has been targeted investment in services to improve performance where this is a Council priority. This includes investment from the Priority Improvement Reserve in services where there has been poor performance, for example, £30,000 invested in the Housing Benefit service, which has contributed to turn around times for processing of new claims reducing from 43.5 days in 2005/06 to 24.53 days for 2006/07. Financial pressures facing the Council and desire to re-profile expenditure towards higher priority areas, resulted in the Efficiency Review programme. This generated options for redirecting £1.4 million towards council tax and spending priorities, whilst also enhancing investment in some key areas. Across the Council, working practices and staffing levels and services have been reviewed. The Service Development programme board is now well established. Any technology projects that are required across the organisation must be supported by a business case that clearly outlines all resources required, the costs benefit to the department and how it fits within the corporate priorities. The Council has a good record of attracting external funding, for example the Safer Stronger Community Fund, to regenerate two of the most deprived wards in Thanet, Cliftonville West and Margate Central. The Council has demonstrated that it is willing to tackle difficult problems and take tough decisions. One of these centred around `The Big Idea', a proposal to build a multi-agency community resource centre at Westwood by a group of four representatives from the community and voluntary sector. These included the Chairman of the Local Strategic Partnership (LSP) and representatives from three other partner organisations. Following discussions with the Council and presentations to the LSP in 2005, the Council's Scrutiny Panel undertook a review of the proposal and recommended to Cabinet that the Council should not support `The Big Idea'. This was a controversial decision, particularly given the involvement of partner organisations, but the Council was concerned about further impact on the three town centres and possible financial implications in the future. A balance had to be struck between competing demands and expectations, with consideration for available resources at that time and in the future. The Council considers those areas where efficiencies can be made and uses these to inform the Annual Efficiency Statements. Key efficiencies delivered in the last 2 years include fewer managers - for example, reducing the number of Heads of Service from 12 to 6 equating to c. £500,000 saving per annum. This has enabled resources to be allocated to priority areas e.g. an increase in the number of Community Wardens, and enhancing areas such as waste and street cleansing, major projects, performance management, Human Resources, job evaluation, consultation and communications. Waste collection service delivered to meet statutory requirements and is measured under BVPI 86. Thanet has very low collection costs per household (£30.85) in comparison to other local authorities, putting us in the top quartile. Where externalising services can deliver savings or a better service for the same cost this has been pursued and has been found to work successfully. Examples include insurance where a contribution of £15,000 for 2006/07 released 1 FTE to concentrate on strategic risk management and using Kent County Council to run the lease car scheme which released cashable savings of more than £3,000 and future savings of around £5,000 over the next three years. In March 2007, the payroll service was partially outsourced to a Bureau Service, thus providing updated software, more resilience and better quality outputs. In addition, a decision was taken to outsource the internal audit function by working in partnership with other East Kent Authorities. Although there was a saving of £35,600, the main aim was to improve the quality and resilience of internal audit, whilst also learning from other authorities and creating a joint understanding amongst authorities and the Audit Commission. The Council has faced recruitment and retention difficulties due to its relatively isolated location and poor current public transport links. The Council has improved its recruitment methodology, and is planning to make efficiency savings, whilst improving response rates, by on-line applications and combining advertisements. On advertising spend, there has been a review of the use of different vehicles for advertising to ensure best value and not just lowest rates. All adverts are now branded appropriately, conforming to guidelines to maximise effect. Six-monthly reviews and analysis of the effectiveness of advertising will be compiled to ensure that the new policy is offering value for money. The overall effect may not result in reduced expenditure but will result in more effective use of advertising. The Council has a large proportion of benefits claimants, and services to this vulnerable group are particularly important. Staffing reductions within Benefits of £133,100 combined with £600,000 funding in a new corporate `backbone' DIP and Workflow system provided an overall corporate direction for the future service (funded by DWP). This system enabled accelerated improvement in Benefit processing times from 43.5 days in 2005/06 to 24.53 days for 2006/07 so that people receive their benefits more quickly. The Council has approved 16 performance indicators as being high priority for 2006/07. The group consists of a mixture of local and national PIs, which reflect the Council's operational priorities. They are examined in detail, by ECMT and Cabinet on a monthly basis via the Service Performance Packs and a monthly Challenge report produced by Corporate Projects and Improvement. All other operational indicators are monitored on a "by exception" basis, enabling members and senior officers to focus their attentions on the areas that matter. The One-Stop-Shop is due to be opened in December 2007. This will see the first co-location of a Library and council services encouraging a range of customers that may not currently use these services to have access to a wider range of government services. This combines with the planned closure of the Cash Offices and re-provision of payment arrangements by card, phone and payment kiosk or use of Post Office. Staffing resources will be reconfigured to improve waiting time, particularly for Benefits customers. This Library and One-Stop-Shop integration provides the catalyst for further accommodation review by releasing £1m capital and around £200,000 p.a. revenue for re-investment in front line services. The Heads of Service are responsible for monthly budget projections, based on discussions with and support from the Financial Services Team. Changes to the Council's Financial Procedure Rules have increased virement levels and meant that the council did not have to present a revised budget for 2006/07. This has cost and time savings, and means attention is focused on working within the budget agreed. This means the Council is taking pro-active steps to improve financial management and free up funding to be moved towards the Council's priorities and those areas with capacity to make effective use of any additional income. The Council, having undertaken major step-change, service reviews and whole-Council efficiency reviews, is now implementing a programme of focussed service specific and thematic reviews. This review `toolkit' has been incorporated as an early module within the Thanet Manager Programme and will help internalise skills of review, data analysis and challenge. Future detailed reviews will be guided by data on cost and quality, procurement phasing and priorities. We have developed a programme of Value for Money reviews, including comparisons to nearest neighbour and BVPIs which will cover the following areas: Advertising, now pooled and higher impact for less cost also maximising via recruitment microsite Grants to the Voluntary and Community Sector Housing and General Fund Mears Contract and Repairs Waste Collection Thanet Leisure Force Planning Revenues and Debt Collection - ratio of cost and debt Thanet District Council Accommodation, informed by Ashford Beacon benchmarking Cabinet approved the Managing Sickness Absence Policy in June 2004. This policy, and its procedures, are designed to support and sustain staff through illness and assist in their return to productive work. There is an updated policy in draft, due for consultation in June 2006. The Best Value Performance Indicator (BVPI) 12 (Number of days lost due to sickness per FTE) showed improvement of 1.16 days in 2004/05. The Council has not been able to maintain this improvement in 2005. The Council appointed Hay Group to oversee a Job Evaluation exercise and staff were trained to undertake this process. New Job Descriptions, based on the “STEP” format, were written for all staff. In January 2006, based on the new job descriptions, each individual received a Job Evaluation Personal Illustration, which advised the Hay score awarded to their post and salary projections based on the salary grades under consultation. Officers had the right to appeal and the outcome of these was communicated in March 2006. The review of Terms and Conditions were shaped by the views that came from the staff survey carried out in the summer of 2005. Negotiations continued between Management and Unison, which reached agreement on the new pay and benefits package and the programme for further work in 2006. The pay scales came into effect on 1 April 2006. The Waste and Recycling service will be re-organised during 2006 to achieve acceptable levels of service efficiency and cost prior to market testing in 2009. The Capacity Building Fund grant received from the Department for Communities and Local Government (DCLG) has been used to arrange a training programme for Members and managers. The focus of this training will act as a catalyst for the required culture change throughout the organisation. In addition, the Council tendered in June 2005 for the delivery of the Thanet Manager Programme. The management programme will look at skills, knowledge, attitude and behaviours, which will help the organisation, develop and provide even more effective staff, services and performance. The programme includes a module covering financial training, risk management and resource management. The training is due to commence in September 2006. The launch of the corporate customer service standards was held in December 2004. Customer Care workshops have been carried out across the Council to approximately 40% of all staff. Mystery shopping is taking place on a quarterly basis starting in April and results will be reported to ECMT. The number of telephone calls not answered is monitored on a monthly basis. The Council was awarded Investors in People status in March 2005. This is a national quality standard, which sets a level of good practice for improving an organisation's performance through its people. A new approach to the management of information in terms of manual and electronic records and processes is being implemented. This is essential for the Council to make progress and improve customer service and move away from holding information in an uncoordinated and disparate way. Developments include: An Information Audit has been completed for Council services, which identifies information held, by whom, for how long, in what format, methods of access and retrieval. Retention Schedules are being produced, building on the results of the Information Audit. A Draft TDC Record Management Protocol, which is a statement of best practice principles, has been approved by ECMT and is available on the intranet. Two documents are due to go to Cabinet in June 2006: The Information Management Strategy and the Retention and Disposal Protocol. Revenues and Benefits went live in December 2005 with Document Image Processing (DIP) and Workflow, this has been funded by the Department of Works and Pensions. The system will be rolled out corporately and will form part of the Council's developing Information Strategy. More services are being offered via self-service and the Customer Contact Centre. There is a Members Portal in place that 25 Members have been trained to use. The implementation of additional software as part of the Financial Information System allows orders and remittance advices to be automatically faxed and e-mailed. It also enables an image to be stored when documents are created that can be retrieved within the system. This process is currently used for orders, debtor invoices and remittance advices. Creditor Invoices received by the authority are now being scanned so that these can also be viewed from the Financial Information System. Work is underway to enable the workflow of these invoices for on-line authorisation. Workshops begun in May 2006 to enable the receipt of electronic invoices and processing of invoices from suppliers. An increased number of invoices are being paid by BACS. Project Management training courses were undertaken by relevant officers in October 2005. This training is ongoing but awaiting instruction from the Steering Group. Lifelong Learning is part of the Government's strategy to encourage a culture in which education and training are available and accessible to everyone. As a result, Unison's Lifelong Learning Representatives are working with the Training Officer to promote this culture within the workplace and to encourage and support staff in their training and learning needs. In February 2005 the Council created a Learning Resource Centre, designed to provide a quiet learning area for those wishing to develop or pursue skills and access to online training materials, without the costs of travel. Legal Services staff are using video training to reduce travel costs. The Gershon agenda requires all Government Departments to achieve efficiency savings. Thanet has been given a target of £1.7m per annum by 2007/08. Savings from the Service Efficiency Review were included within the 2005/06 Annual Efficiency Statement Forward Look, completed in April 2005. The forward look 2006/07 Annual Efficiency Statement was completed by the April 2006 deadline. To further drive efficiencies, the Council has been working in partnership with all other Kent authorities in areas such as ICT and procurement. A supplier spend analysis previously undertaken as part of a collaborative tender with other Kent Councils continues to identify and inform the Council's Procurement Strategy and the collaborative procurement agenda within Kent and the South East Region. Both the supplier spend analysis and participation in other initiatives such as the Regional Centre of Excellence pilot Pricetrak analysis, (which benchmarked common commodity prices), are used to base and track future efficiency and cost savings. Also, the further enhancement of the use of modern methods of procurement will continue to improve and streamline processes required for meeting the Gershon efficiency agenda. A fitness check carried out by the National e-Procurement Project (NePP) into the progress the Council has made with e-procurement and a Procurement “Health Check” carried out by the IDeA further informs the Council's action plan for the Improvement and Development of Procurement. To ensure the effective allocation of capital resources, the Authority uses an agreed list of weighted priorities to assess schemes. This process was revised in December 2004 to ensure close links with corporate priorities. All bids for new money, whether revenue or capital, now require the completion of a form to enable an assessment to be made as to benefits and risks of a particular project. There is an Asset Management Group, which reviews the Council's assets. Members and CMT have reviewed and identified surplus property, which can be sold to release resources to fund the capital programme. Financial Services submitted a Key Lines Of Enquiry (KLOE) Use of Resources self assessment in December 2005. In March 2006 the Council received the Audit Commission's assessment for Use of Resources, which showed an overall score of 2. This represents improvement from the Weak CPA rating given in July 2004. Financial Services are currently participating in CIPFA Benchmarking clubs for Creditors, Debtors and Accountancy. The outcome of these will enable informed performance management/best practice decisions.
3.8	The financial management of the authority and the reporting of financial management. The financial management of the authority and the reporting of financial management (cont).	The S151 Officer has statutory duties in relation to the financial administration and stewardship of the Council. This statutory responsibility cannot be overridden. All staff and Members have a duty to abide by the highest standards of probity in dealing with financial issues. This is facilitated by ensuring everyone is clear about the standards to which they are working and the controls that are in place to ensure that these standards are met. Key elements of financial management within the Council include: A Medium Term Financial Strategy (updated February March 20062007) A strategic three four year budget (February March 20062007) Review of the annual budget (February 20062007) Monthly monitoring of expenditure and income against budget Financial Procedure Rules (updated May 2006) Named officers responsible for all items of the Council's spending Segregation of duties Contract Procedure Rules (updated May 2006) Capital Investment Strategy (updated February 2006) Capital Protocol (updated February 2006) Treasury Management Strategy (updated February 20062007) Prudential Indicators (updated February 20062007) Anti-Money Laundering Policy (January 2006) Income Management Protocol (June 2006) The Medium Term Financial Strategy covering the period 2006 2007/11, sets out the Council's strategic approach to the management of its finances and council tax levels and will assist the Council in achieving Corporate Plan targets and other strategic plans of the Authority. The Capital Investment Strategy also complements other strategic plans and sets out how capital resources are used to achieve the Council's strategic vision and corporate objectives. The Capital Protocol defines roles and responsibilities of Members and officers. A performance mechanism and working party will effectively monitor capital resources and schemes. The General Fund Budget for 20075/086 includes projections for the following three years, this has allowed an extra year of budget planning to the process. and 2006/07 highlights how resource allocation has been influenced by residents' priorities, including using the results of recent MORI and SIMALTO surveys. The monthly budget monitoring process and work associated with producing and affecting the annual Service Plan ensures that officer attention is directed to the efficient and effective use of resources. Since April 2004, Corporate Management Team (CMT) receive full year financial projections each month for the General Fund and Capital. From December 2004 HRA projections have also been provided on a quarterly basis. In addition, a quarterly Performance Pack, including a financial summary, has been presented to Cabinet. This highlights budget variances and improvements to the financial planning process. CMT recognises that there are areas for improvement with regard to retrospective ordering within the Authority. The Chief Executive has taken a personal interest over this issue. The value of retrospective orders in 2006/07 is £9,218,241. Improvements have already been made in 2007/08.In June 2005, Financial Services held a Financial Information System and Resource Management System surgery. Five staff were on hand to hold one-to-one meetings with those that attended. A Finance Working Party Group was set up in October 2005 consisting of officers from Financial Services and department representatives. This group is responsible for devolving financial responsibility and improving communication. In addition, a budget holder's handbook will be made available outlining the Council's financial procedures and training is being organised for July 2006. In June 2005, arrangements were made for a £4.5m loan to be re-scheduled, resulting in significant annual savings to the Council. Bank reconciliation procedures are in place to ensure that monthly balancing is kept up-to-date.The newly formed Income Management Group held their inaugural meeting in February 2006. The group is led by the Head of Resources and includes representatives from all services. The group has responsibility to compile and maintain a protocol for the income management process and progress CPA requirements. Manager Briefing Sessions and Staff Development Sessions were held in June 2006 on the new Contract Procedure Rules (CPRs). Monthly monitoring of Contract Procedure Rules has been introduced and the rules can be found on the Council's Intranet site.
3.9	The performance management of the authority and the reporting of performance management.	When it comes to monitoring, each service is responsible for monitoring its own operations internally throughout the year. On top of this, a monthly Performance Pack is produced by each service, signed off by the Head of Service and Portfolio holder. The performance packs monitor performance against the service plan and are reviewed at Extended Corporate Management Team. They are also made available to all members and officers via the members portal and the intranet. A higher level Corporate Pack is produced each quarter. The Corporate Pack aims to highlight performance against the Council's key priorities against its Corporate Plan. It gives a Corporate overview of the authority but also goes into detail about specific performance issues and successes of individual services. The Corporate Pack is sent to Cabinet, and then to the Finance, Best Value and Performance Review Scrutiny Panel. On top of these more official reports, the Improvement and Performance Service puts forward a monthly report to ECMT to raise performance issues and to provide challenge to HOS and Directors on performance trends and project management. Improvement and Performance also send various reports to ECMT throughout the year to inform performance management covering various issues, including target setting, data collection and quality and prioritising performance indicators. A number of reviews of services are carried out during the year. There is now a programme of Value for Money Reviews, which covers a broad range of issues ranging from dredging in Ramsgate Harbour to Council Tax. The Corporate Plan is reviewed annually and each Service produces a new service plan each year following careful review of its previous plan. In September 2003 the Council introduced a Performance Management Framework. Key elements of this approach include regularly updated service plans, improvement plans and key control documents. All performance management issues are monitored monthly via the “Performance Pack” - a control mechanism that covers all services. The relevant Cabinet portfolio holder reviews the performance packs and more recently the Council has moved to allowing Shadow Cabinet Members access to performance packs as part of its commitment to improving Performance Management and transparency. Development work on performance packs and quarterly performance reporting is continuing in 2006 to streamline the process and report on an exception basis. The Council is currently conducting Performance Improvement Planning Workshops to enable managers to better address poor performance issues within their teams and support the delivery of new Human Resources policy guides. The Council also publishes an annual Best Value Performance Plan, which shows how the Council is performing against national, and with effect from June 2005, local performance indicators. To assist in setting SMART performance indicators and targets, workshops have been held to bring outcomes into national second quartile performance. Each Head of Service produces a detailed service plan setting out key objectives and actions, which is monitored through their monthly Performance Packs. The IDeA and OPM gave assistance in 2006 to help strengthen the service planning process. CMT, HOS, managers and Members were engaged in the planning process and a Launch event was held in May 2006 for all staff to familiarise themselves with corporate and service objectives. The Council completed a Best Value Review of Leisure Services during 2005, resulting in a 5-year improvement plan. The Audit Commission will be conducting an inspection of Cultural Services in July 2006.

Ref No	SOURCE	REVIEW ACTIVITY
4.1	The Authority	The majority of tThe Council introduced Managers Assurance Assessment Statements for 2006/07 . The majority of these have been completed and returned. Based on these assessments, issues raised as significant were considered by the Section 151 Officer and the key areas of concern are identified below: Managers must ensure that agreements are in place for all partnership arrangements and exit strategies are prepared All areas should put in place arrangements to ensure that assets for which the area is responsible are properly safeguarded and controlled All staff with financial responsibilities should be made aware of, and adequately trained to carry out, their duties Business Continuity arrangements must be put in place for each area Procedures must be developed and implemented for each business critical process in service areas Managers must familiarise themselves with all relevant legislation and council procedures, put in place processes to comply and take action in instances of non-compliance Managers must identify risks arising from new initiatives and ensure their staff are trained to manage risk appropriate to their duties Managers must ensure that they have addressed the weaknesses identified in the 2004 CPA reportIT services must be confirmed as secure and satisfactory Income management processes must be further developed To date, 9897% of the 20065/076 declarations in accordance with FRS8 (Related Party Transactions) have been returned. The following have been declared: SixSix instances of association with partnerships, companies, trusts or any entity that has transacted with the Council One Member had a Renewal Grant paid direct to a third party TwoTwo instances of transactions with the Council
4.2	The Executive	The Executive (Cabinet) receives and will continue to receive quarterly Performance Packs. The Cabinet uses the Performance Packs to monitor the key priorities, performance indicators and projects. All the information above is used to redirect resources, in line with the Financial Procedure Rules, to ensure the Council's priorities are met. Informal Cabinet receive monthly budget monitoring information.
4.3	Scrutiny Committees Scrutiny Committees (cont).	The overview and scrutiny annual review for 2005/06 went to Finance, Best Value and Performance Review Panel in May 2006. The report states that in May 2005, the Council agreed for the Executive and Policy Scrutiny Panel to encompass the work of the Executive Scrutiny Panel and the Policy Development Panel. The Finance, Best Value and Performance Review Panel remained unchanged. Of the twenty-four items considered by the Executive and Policy Scrutiny Panel, five recommendations were made to the Executive. Please find below examples of items considered by Eight recommendations were made to the Executive of the twenty-three items considered by the Finance, Best Value and Performance Review Panel in 2006/07. Examples of items considered include: The impact of offering free Bulky Refuse collection was discussed on 3rd October 2006. The Panel requested that officers investigate and report back on the possibility of means testing and providing area collections for bulky waste Draft Fees and Charges - At its meeting on 27 October November 20065, the Panel considered the report discussed the way in which the Council sets its Fees and Charges. The panel questioned how fees and charges were set on a number of services and raised a number of issues to be answered at the forthcoming Budget Working PartiesRevised Risk Management Strategy - On 24 January the Panel considered a report on the revised risk management strategy and raised a number of concerns The Panel considered the Forward Plan at a number of meetings The Panel has considered Tourism Grants at a number of meetings. Below are examples of items considered by Executive & Policy Scrutiny Panel in 2006/07: On 26th April 2006, the Panel considered the report on the Big Idea. The Panel advised that it would not support the project for the following reasons: That this is a long-term commitment to which the Council is unable to subscribe The potential closure of local satellite offices and relocation at Westwood Cross It is the Council's priority to ensure that local services are provided throughout the District and not focused in one area On 23rd November 2006, the Panel considered the Planning Process for 2007/11. The decision was that a sub-committee be set up consisting of 4 Members of the Panel with a ratio of 2:2 to progress the development of the programme and submit a report to a future meeting of the Panel before making recommendation to Cabinet. On 1st March 2007 the panel made recommendations, including that “Decent Quality Housing” be added as a further overarching theme within the Corporate Plan 2007/11 to encompass all housing related actions At the meeting on 1st March 2007, the panel reviewed the report and decision of Cabinet on 6th February 2007 on Asset Management - Disposal of sites and telecom installation at Southwood Recreation Ground. The panel's decision was to further scrutinize the decision to dispose of the sites at Montefiore Avenue and King George VI Park in view of the strength of public opinion against it. This item was again discussed on 29th March 2007, the decision was, the disposal of the former putting green and tennis courts, Montefiore Avenue, be referred back to Cabinet with recommendations that: The matter be returned for inclusion in the Forward Plan The procedure for bringing forward asset disposals be reviewed and clarified before further action regarding potential disposal of this particular site On 29th March 2007, the panel received a report, which was first considered on 23rd November 2006, on the possible transfer of licensing arrangements for placing of chairs and tables or temporary street furniture on the highway from Kent County Council to the District Council. The decision was to decline KCC's invitation to be responsible for this licensing The Panel has already considered the provision of a new swimming pool at a number of meetings and the matter is currently still undergoing scrutiny Budget Scrutiny Working Panels met to discuss the budget. This resulted in eleven recommendations being made to the Executive. Examples include: That Cabinet consider alternative parking arrangements for staff that currently use Mill Lane Car Park That Cabinet as part of the 2008/09 budget position establishes a reserve to be used for Match Funding
4.4	East Kent Audit Partnership (EKIAP) East Kent Audit Partnership (EKIAP) (cont).	The East Kent Audit Partnership has provided the internal audit service for the Council for the financial year 2006/07. This has been its first full year working at Thanet District Council. The Internal Audit function has been provided by the East Kent Internal Audit Partnership (EKIAP) from mid December 2005. The Partnership incorporates Thanet, Dover and Shepway Councils Throughout the year, the EKAP has performed a number of reviews covering both financial matters and services. Following each review, a report has been produced for Management, which includes an assurance level. Details of the work completed are reported to each meeting of the Council's Governance & Audit Committee. An annual report detailing the performance of the EKAP against its targets for the year is produced to the June committee. The Council's systems of Internal Control include reliance on adherence to key policies, and in particular the Contract Procedure Rules (CPRs) and Financial Procedure Rules (FPRs). Non-compliance with Contract Procedure Rules has been observed. The effect of failures observed impacts on the Council's ability to prove that it has received value for money. No significant failure to comply with Financial Procedure Rules was noted. This led to a report to Finance, Best Value and Performance Review and an agreed Action Plan. In May 2006, the Council revised FPRs and CPRs, in part to address concerns raised. The majority of the work undertaken has resulted in at least an adequate level of assurance. There are however, several areas where assurance levels given have been lower than this, and these services / functions give some cause for concern: Queensdown water supply - limited impact should problems arise, but could potentially be a costly liability for the Council Public Health Act Burials - inadequate internal controls Housing Allocations - although a general review resulted in an adequate assurance, an investigation into one particular case showed failure for “joined up working” across the Council, which had the potential to cause unnecessary expenditure Cash handling procedures at the Dickens House Museum & Visitor Centre are insufficiently robust A review of charges to housing leaseholders has revealed historic anomalies in the legal agreements, and inefficient working processes Some ICT arrangements, which were reviewed during the year, need strengthening Compliance with Contract Procedure Rules is inconsistent, and demonstrates where better planning is required throughout the relevant procurement processesDue to limited resources, controls inherent in the separation of duties are not always present. However, the Council has taken reasonable steps to implement compensatory controls. Weaknesses reported in the Statement for 2004/05 relating to Non-Domestic Rating have been reviewed and adequately dealt with. Only the E-Government and (in 2006/07 year) compliance with Contract Procedure Rules were given less than adequate assurance. However, the Overall Assurance on the systems of Internal Control is Adequate. Conversely, there were examples of good management in financial and service areas. Of particular note: Various aspects of the waste management service were reviewed throughout the year, with most aspects receiving a substantial assurance Aspects of the Housing Benefits service reviewed were also given substantial assurances It is also pleasing to note that the financial controls on the whole tend to have resulted in substantial assurances for the individual reviews. Subject to Management ensuring that corrective action is taken to address the weaknesses noted, the EKAP provides an adequate assurance for Thanet District Council's arrangements. The above comments are a summary of the report. The full report provided by the EKIAP will not form part of the statement but was considered by those signing the Statement on Internal Control. In accordance with The Accounts and Audit (Amendment) (England) Regulations 2006, a review of effectiveness on Internal Audit has been undertaken for 2006/07. The overall conclusion of the review was that there is an effective system in place to manage performance and deliver an effective internal audit function (this will be reported to Governance and Audit - June 2007).In addition, the East Kent Internal Audit Partnership carried out a review of the Council's Structure and Process arrangements based on the CPA Key Lines of Enquiry. Although it was recognised that positive steps have already been taken to address areas of identified weakness, a Limited Assurance was awarded due to the timing of the review as structure and processes need time to embed.
4.5	Audit Commission Audit Commission (cont).	The Council has a statutory responsibility to prepare its annual accounts to present fairly its operations during the year. These are subject to external audit. This audit provides assurance that the accounts are prepared properly, that proper accounting practices have been followed and that quality arrangements have been made for securing economy, efficiency and effectiveness in the use of the Council's resources. The Audit and Inspection Letter for the 2004/05 draft Accounts Memorandum for 2005/06Accounts states that: “The review of the process behind the preparation of the Statement on Internal Control has found the documentation and evidencing to be good. With officers permission the Council's Statement on Internal Control has been shared with other Kent districts as an example of good practice” “The overall assessment of the Council's material information systems was that in general adequate controls were found to be in place in respect of most inherent risks. However, the reliance we could place on them to support our audit opinion was diminished due to”: unreviewed control account reconciliations; and limited reliance on the Internal Audit function. “the Council's overall corporate governance arrangements are adequate”. However, it also states that “the Council cannot yet demonstrate that it is providing consistently value for money across its services”. In June 2004, the Audit Commission published the results of their inspection of Thanet District Council, which identified Thanet as a “weak council that has recognised the need to build the foundation for improvement”. In 2004, an independent Comprehensive Performance Assessment, carried out by the Audit Commission classified the Council as “Weak”. Since then, the Audit Commission has recognised that the Council has made significant improvements and we were reassessed in February 2007. The report, published in June, states that Thanet is now a 'Fair' Council. An Audit Commission assessment of CPA Key Lines of Enquiry - Use of Resources was carried out in 20052006/0607. The findings were will be reported to Finance, Best Value and PerformanceGovernance and Audit Committee Review Panel in May June 20062007: Financial Reporting - Level 2 (adequate performance) Financial Management - Level 2 (adequate performance) Financial Standing - Level 2 (adequate performance) Internal Control - Level 1 2 (inadequate performance) Value of Money - Level 1 2 (inadequate performance) The Overall Assessment awarded by the Audit Commission was 2 out of 4.
4.76	Improvement and Development Agency (IDeA)	With monies from the Capacity Building Fund the Council invited IDeA to carry out an overview and Scrutiny “Health Check” during November 2005. This helps to assess the authority's current achievements and its capacity to change and improve overview and scrutiny. The IDeA met with a range of officers and Members. Officers have evaluated the report and are in the process of preparing an Action Check List to address the IDeA recommendations and issues. The report was presented on 24 May 2006 to Members and senior officers. The Peer Mentoring programme started in Autumn 2006, with both political groups assigned a mentor. This programme was identified as being part of the Council's Capacity Building Programme in order to build member capacity. It has been extremely successful and the mentoring has been extended for both groups.
4.87	The Commission for Local Administration in England	Tony Redmond, the Chairman of The Commission for Local Administration in England met with senior officers and Members to discuss the Local Government Ombudsman complaint statistics. He gave very positive feedback on the Authority's complaint analysis. The provisional complaint statistics for 2005/06 advised that 48 decisions were made, of which, 10 complaints were premature, 4 were outside of the Ombudsman's jurisdiction and 7 advised to discontinue the complaint. Of the remaining 27, 5 were settled locally and 22 no evidence of maladministration was found. In April 2007, The Council received provisional end-of-year statistics from The Commission for Local Administration in England. These statistics advised that 62 decisions were made, of which 20 complaints were premature, 6 were outside of the Ombudsman's jurisdiction and 8 advised to discontinue the complaint. Of the remaining 28, 10 were settled locally and for 14 there was no evidence of maladministration found. Since 1 April 2007 to date we have received a further 10 complaints that are being investigated by the Ombudsman. 2 of these complaints have now been closed at the Ombudsman's discretion. These will be included in the published figures for the year ending 31 March 2008. A further 2 have now been closed from those cases published in the figures for the year ending 31 March 2007. 1 of these was a Local Settlement and the other was closed at the Ombudsman's discretion.