Agenda and minutes

It was agreed that Cllr. M. Watson be appointed Chairman for the meeting.

Cllr. M. Watson in the Chair

The minutes of the meeting held on 26 May 2020 were taken as read, confirmed and signed.

The Chairman invited members who wished to do so to declare any interest in respect of items on the agenda for the meeting.

No declarations were made

There were no urgent items for consideration.

The Subcommittee received a report of the Consortium Treasurer outlining the progress made against the Internal Audit Plan for 2021-22. A copy of the report, marked ‘Agenda Item 5’, is filed with these minutes.

The Subcommittee was advised that there was one legacy partial opinion in respect of the 2020-21 credit control audit. Members were pleased to note good progress had been made on testing to date and that an update would be provided at a future meeting on whether recommendations had been addressed.

Members noted the continued importance regarding Cyber Security and the ongoing work as part of the Audit plan.

The Internal Audit Service did not have the resource to audit all areas of ESPO, instead the plan took a pragmatic approach to focusing on high risks to ESPO and its owners, such as the deferred rebate income audit.

RESOLVED:

That the report and information now provided be noted.

The Subcommittee received a report of the Consortium Treasurer on the Annual Internal Audit Plan 2022-23. A copy of the report, marked ‘Agenda Item 6’, is filed with these minutes.

The Subcommittee was informed that the ESPO Senior Management Team met regularly with the Consortium Treasurer and the Head of Internal Audit at Leicestershire County Council to review the findings of audits. Any high assurance recommendations found would be shared with Members.

Members noted that nationally accounts payable was a key area for consideration, given remote working and the risk of bank mandate fraud. On a local level some errors had been detected and corrected by ESPO, so it was felt important to run a data analytic tool on the system to check for any potential duplicate addresses.

In response to queries Members were assured that there was separation of duties in relation to purchase order raising and invoices, and that procedures were being toughened up where possible.

RESOLVED:

That the Subcommittee support the methodology used as a basis for development of the internal audit plan and that the Annual Internal Audit Plan 2022-23 be recommended for approval at the Management Committee on 16 March 2022.

The public are likely to be excluded during consideration of the following items in accordance with Section 100(A)(4) of the Local Government Act 1972 (Exempt Information).

That under Section 100A of the Local Government Act 1972, the public be excluded for the remaining item of business on the grounds that it involves the likely disclosure of exempt information as defined in Paragraphs 3 and 5 of Part 1 of Schedule 12A of the Act and that, in all circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

The Subcommittee received an exempt report of the Director and Consortium Treasurer outlining the financial performance year to November 2021 A copy of the report, marked ‘Agenda Item 9’, is filed with these minutes.

The report was not for publication as it contained information relating to the financial or business affairs of a particular person (including the authority holding that information).

Arising from the discussion the following points were noted:-

i.                It was reported that ESPO was on track to exceed a surplus of £5.1m, ahead of what had been budgeted and the previous year’s performance, and was estimated at the higher end of the £5.1million to £5.7million, which Members welcomed.

ii.               There remained volatility in the energy market as a result of international circumstances. Members were pleased to note that its energy buying strategy had protected its customers from exposure to price hikes to date and that ESPO communicated regularly with its customers about risk and pricing as it was recognised that could only be managed to a certain extent. 

iii.                 ESPO’s framework range included charging infrastructure and specialist vehicles, including electric vehicles. They had been affected slightly due to the worldwide shortage in semiconductors, however, were expected to perform positively once stocks improved.

iv.                   

RESOLVED:

That the report be noted.

The Subcommittee received an exempt report of the Director and Consortium Treasurer outlining the A copy of the report, marked ‘Agenda Item 10’, is filed with these minutes.

Arising from the discussion the following points were noted:-

i.                ESPO was aligned to Leicestershire County Council’s pay grade structure, which exceeded the living wage, and warehouse operatives would be paid £11.50 an hour from April 2022. Pressures on recruitment were recognised following the United Kingdom’s exit from the European Union, however it was felt ultimately ESPO had a good employment offer that was attractive.

ii.               Inflation was recognised as a key risk for ESPO and the impact it may have on the public sector and their discretionary spend.

iii.              The My School Fund was a major initiative for ESPO and it needed to ensure it continued to work with schools to communicate the project to parents, to recognise that it benefitted both parents and schools.

iv.             It was queried whether there were any supply chain issues in relation to the introduction of the UKCA mark, following the United Kingdom’s Exit from the European Union, with Members having noted other fire and electric companies needed to get items recertified, though the current deadline had been extended for 12 months.

RESOLVED:

That the following be supported for approval by the Management Committee on 16 March 2022.

a) Agreement of the 2022/23 Budget which incorporated the recommended revenue budget totalling a surplus of £5.7million.

b) Approval of the 2022/23 capital programme totalling £310,000.

c) That the level of reserves as set out in paragraph 80 be noted and that the use of

those earmarked fund be agreed.

RESOLVED:

It was noted that the next meeting of the Committee would be held on 11 May at 10.30am.