Governance and Audit Committee

Committee roles and core functions

June 2011 - Version 2

Governance and Audit Committee

Audit committees are an essential feature of good governance. An audit committee is an additional source of assurance that systems of internal control are working effectively, that there are adequate arrangements in place for managing risk, that internal audit is operating in accordance with the Code of Practice, and that an open and honest approach to governance arrangements can be demonstrated.

Simply put, the Governance and Audit Committee exists to provide independent assurance that there are adequate controls in place to mitigate key risks and to provide assurance that the council is operating effectively.

Core functions

Consider the effectiveness of the authority’s risk management arrangements, the control environment, whistleblowing arrangements and associated anti-fraud and anti-corruption arrangements.
Seek assurances that action is being taken on risk-related issues identified by auditors and inspectors.
Be satisfied that the authority’s assurance statements, including the Annual Governance Statement, properly reflect the risk environment and any actions required to improve it.
Approve (but not direct) Internal Audit’s Strategy, Plan and monitor performance.
Review summary internal audit reports and the main issues arising, and seek assurance that action has been taken where necessary.
Receive the annual report of the Head of Internal Audit.
Consider the reports of external audit and inspection agencies.
Ensure that there are effective relationships between external and internal audit, inspection agencies and other relevant bodies, and that the value of the audit process is actively promoted.
Approve the financial statements, external auditor’s opinion and reports to members, and monitor management action in response to the issues raised by external audit.

Both the Audit Committee and Scrutiny function deal with complex matters, sometimes requiring specialist knowledge and advice. Concentrating on their own defined areas of business, rather than a broader remit, ensures these committees are likely to be more effective.

Overview and Scrutiny Panel

Section 21 of the Local Government Act 2000 requires any council operating executive arrangements to establish at least one Overview and Scrutiny Committee. The Act describes a threefold role for Scrutiny, firstly a power to review and scrutinise the decision and actions of the Cabinet, including the power to ‘call-in’ for review any Cabinet decision ‘made but not implemented’. Secondly the role of mandatory consultee in relation to the development and review of the council’s Budget and Policy Framework and thirdly, the power to make reports and recommendations to the Cabinet on the development and review of policies not comprised in the Policy Framework.

The Overview and Scrutiny Panel also has the power to scrutinise and review the discharge of functions that are not the responsibility of the Cabinet (excluding the review of individual regulatory decisions). In addition, recent legislative amendments have given the panel the power to review the effectiveness of the local Crime & Disorder Reduction Partnership as well as the power as to consider Community Calls for Action from Ward Councillors. The overall intention is to enable the Overview and Scrutiny Panel through it reviews, reports and recommendations to act as a critical friend to the Cabinet, advise the Cabinet and Council as a whole on its budget, policies and service delivery and give the community a greater say by examining matters of local concern.

Core functions

Make reports or recommendations to the Cabinet and/or appropriate committee and/or Council arising from the outcome of the scrutiny process.
Question members of the Cabinet and/or committees and chief officers about their decisions and performance, whether generally in comparison with service plans and targets over a period of time, or in relation to particular decisions, initiatives or projects.
Question members of the Cabinet and/or committees and chief officers about their views on issues and proposals affecting the area.
Question and gather evidence from any person (with their consent).
Exercise overall responsibility for the finances made available to them.
Exercise overall responsibility for the work programme of any officers employed to support their work.
Consider and implement mechanisms to encourage and enhance community participation in the development of policy options.
Liaise with other external organisations operating in the area, whether national, regional or local, to ensure that the interests of local people are enhanced by collaborative working.
To undertake value for money and other reviews, and review action plans arising from them, including progress on their implementation.

The terms of reference for both the Governance and Audit Committee and Overview and Scrutiny Panel are available within the council’s Constitution.

Standards Committee

The Standards Committee is a statutory committee of the council established to promote and maintain high standards of ethical conduct by providing advice, guidance and training on the requirements of the mandatory Code of Conduct adopted by the District, Town and Parish Councils established in Thanet. Since 2003 the Committee has had the power to conduct hearings into complaints against councillors referred to it by the Standards Board for England and in 2008 the Committee assumed responsibility for establishing Sub-Committees to deal with the initial assessment and investigation of all complaints against District, Town and Parish councillors in Thanet as well as conducting hearings in those cases where the investigator considered that the Code of Conduct had been breached. In order to maintain public confidence in its integrity, the Standards Committee includes four co-opted members of the public (the independent members) one of whom must be appointed as the chairman of the Standards Committee. Moreover, an Assessment, Review or Hearing Sub Committee will always be chaired by an independent member.

In addition to acting as an ethical governance committee, the Standards Committee also contributes to the good governance of the council through oversight of the council’s Constitution (in that the recommendations of the Constitution Review Working Party are reported to the Standards Committee before being considered by full Council), overview of the council’s Complaints Procedure and Ombudsman Investigations and overview of the council’s Whistleblowing Policy and officer Code of Conduct.

Core functions

Promote and maintain high standards of conduct by councillors and co-opted members.
Assist the councillors and co-opted members to observe the members' Code of Conduct; and advise the Council on the adoption or revision of the members' Code of Conduct.
Monitor the operation of the members' Code of Conduct and advise, train or arrange to train councillors and co-opted members on matters relating to the members' Code of Conduct.
Grant dispensations to councillors and co-opted members from requirements relating to interests set out in the members' Code of Conduct.
Deal with any reports from a case tribunal or interim case tribunal, and any report from the Monitoring Officer on any matter which is referred by an ethical standards officer to the Monitoring Officer.
Overview of the Whistleblowing Policy.
Overview of complaints handling and Ombudsman investigations including the power to make payments or provide other benefits in cases of maladministration.
Oversight of proposed changes to the Constitution coming from the Constitutional Review Working Party. The terms of reference for the Standards Committee are also available within the council’s Constitution.

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