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27 June 2024
I’ve mentioned before how parish councils are politics writ small. So it’s interesting to compare the dying days of the national government with the dying months of Hughenden Parish Council.
There’s the incompetence, the insistence that everything is going well, the waste of public money, the denial when evidence is produced about mistakes, the complacency when mistakes have to be acknowledged, the self-interestedness, the attempted cover-ups and then finally the excuses.
It’s all there at parish level writ small.
Councils are required by law to approve their Annual Governance Statements and Accounting Statements for 2023/4 and send them to the external auditors by 30 June. Hughenden Parish Council met on 25 June to do this – and yes, it was cutting it a bit fine.
The Annual Governance Statement requires a council to fill in a form answering “Yes” or “No” to eight assertions. I’m not going to report on HPC's discussions and decisions on eight assertions - just the first to give you the flavour.
The first assertion is “we have put in place arrangements for effective financial management during the year, and for the preparation of the accounting statements.”
A Practitioners’ Guide sets out guidance to parish councils on how to prepare their answers. It says a council “needs to have appropriate evidence to support a ‘Yes’ answer to an assertion, for example, a reference in a set of formal minutes.” And for each assertion it specifies what councils need to demonstrate in order to be able to say “Yes”.
Two hours before the meeting, Council received a summary of the internal auditor’s report.
The auditor assessed whether “the council had complied with its financial regulations, payments were supported by invoices, all expenditure was approved and VAT was appropriately accounted for”. He concluded this objective had not been achieved to a standard adequate to meet the needs of the council.
So you would think Council would have doubts about saying “Yes” to the first assertion. Wouldn’t you?
But not a bit of it. Cllr Jones, HPC’s Chair, kicked off the discussion on the first assertion by saying “we want to say ‘yes’ to this don’t we?” Most other councillors agreed.
There was no discussion about the evidence to support this “Yes” response. There was no mention of the dozen or so specified processes Council needed to have in place and operating effectively under Assertion 1.
So I asked how many other councillors had actually read the Practitioners’ Guide and understood what they were signing up to.
No-one answered. Cllr Jones said my question was inappropriate.
However, I am going to stick my neck out and suggest that, of the other 5 councillors present, at least 4 had not read the Practitioners’ Guide, let alone understood it.
We then had a long explanation of why Council hadn’t complied with its Regulations e.g. why it has not approved any payments in advance, with copies of the relevant invoices since September 2023. I have been banging on about this for 9 months.
And here we saw all the political machinations come into play.
Step 1 – insist, repeatedly, that Council was complying with its Financial Regulations.
When forced by the internal auditor’s report to admit the Council is not complying, move to ….
Step 2 – insist it was (and still is) impossible to comply if Council wants to pay invoices within the statutory deadline and ……
Step 3 – refuse to see this is a problem of Council’s own making.
On the insistence of the locum Clerk, Council decided to meet every two months rather than every month. It also decided that the Finance Committee (which can also approve payments under the Regulations) should meet even less frequently. (The locum Clerk threatened to resign unless Council agreed to this).
This is what caused delays in approving payments.
Moreover, if there were undue delays, it was always open to Cllr Jones, who is Chair of the Council and the Finance Committee, to call an Extraordinary meeting of either to approve the payments. All it needed was an agenda, three councillors and perhaps 20 minutes.
However, if Step 3 doesn’t convince …..
Step 4 – blame your predecessors.
The locum Clerk said the accounts were in a terrible state when he started to work for the Council in October 2023. Which is a bit odd as most of his predecessors were locum Clerks who were his colleagues from the Local Government Resource Centre. This included a director of the LGRC who was sitting at the meeting taking the minutes.
It was also odd as all of his predecessors had managed to comply with this requirement even if the accounts were in a terrible state.
It was even more odd because, if the accounts were in a terrible state before his arrival i.e. for over half the financial year, then surely he should have advised the Council to respond to Assertion 1 with a “No”.
But if blaming your predecessors doesn’t go down well ……
Step 5 – blame lack of resources.
The Council for many years has been run by a maximum of two staff and they have managed to comply with this requirement. The Council now has five part-time staff ( I think); four have been in post for at least 8 months and two are said to have been experienced and qualified for their posts before they started work for HPC.
So why has the Council not complied – and is still not complying?
But if blaming lack of resources doesn’t go down a storm……
Step 6 – argue that Council should not be judged on its past performance but on its intentions; it doesn’t matter that HPC hasn’t complied with its Regulations because Council is going to change the Regulations - and then what Council is doing now will be compliant.
Trouble is auditors look at what Council has done – or not done. And who is to prejudge what Council will decide on any review of its Regulations?
But if this fails to convince…
Step 7 – blame everyone else for being critical; after all, everyone has worked hard and done their best.
All I would say is that the LGRC is contracted to provide a service. And Council is required to ensure it gets value for money.
And, finally, of course …
Step 8 – decide to do absolutely nothing about the non-compliance (and indeed all the other problems picked up by the internal auditor in his six reports since the May 2021, none of which the Council has responded to.)
In the end, Council voted to respond “Yes” to Assertion 1.
In total, Council said "No" to four Assertions and "Yes" to another four.
I asked for a recorded vote for all the assertions and voted against the four “Yes” responses. Council has to provide explanations for the “No” responses when it puts its Statement in at the end of the month. I have asked for copies.
The Council also voted to approve its Accounting Statement for 2023/4 i.e. the 2023/4 outcome. A revised version was given to Council at the beginning of the meeting.
Once again, Council’s balance in the bank at the end of the year has gone up significantly. It was £399k at the end of March 2022, 447k at the end of March 2023 and £521k at the end of March 2024.
However, this time the increase included £151k of Community Infrastructure Levy i.e. money from developers. If it wasn’t for that money, HPC would have reduced its balance by £80k. Which means HPC has been on a bit of a spending spree.
For years, HPC has underspent on direct costs and projects. However, last year (see my blog of 27 July 2023), I thought Council would be so keen to be seen to deliver and to spend its money that it wouldn’t spend prudently and/or in compliance with its Financial Regulations. I think I was right again!
Well, I did tell them!
I voted against the Accounting Statement because a substantial part of the expenditure during the year was paid in breach of the Financial Regulations: and the budgetary information Council received during the year was so unreliable I had no idea whether the expenditure in the Accounting Statement was correct. There was no way I wished to be held accountable for it.
What more can I say about the financial items on the agenda? Perhaps one thing.
Council was provided with a budget variance report for this year up to the end of May. Cllr Kearey had concerns, I think, because the report showed Council proposing to run at a massive deficit of £261k. I think Cllr Kearey was saying that the Council needed to formally draw down its reserves.
I say “I think” as Cllr Kearey wasn’t given the opportunity to explain his concerns properly before he was interrupted. There was no discussion and he got no satisfactory response to his concerns. In fact, I don’t think anyone else understood.
One of those deficits for example is for grants; Council has already approved about £14k of grants against an annual budget of £2.5k.
I pointed out in response to Cllr Kearey’s concerns that Council hadn’t actually approved a budget for 2024/5. It was required to do this before it set the precept in January.
And off we went again.
Step 1 – denial. I was told Council had approved a budget in January.
I suggested this should be checked and no, Council hadn't approved a budget. The Chair of the Council merely “gave [Council] information on the budget”. The actual draft budget is nowhere to be found.
Step 2 – complacency. I was told it was not necessary to approve a budget.
I pointed out that approving a budget before setting the precept is required under Assertion 1.
Step 3 – cover up. The failure to approve a budget was kicked into the long grass. Council ignored this failure when saying yes to Assertion 1 and referred the concerns to the Finance Committee. The next Finance Committee meeting is in October. The last meeting of the Committee was inquorate.
No integrity, no professionalism, and no accountability. Sound familiar?
This Council is dying on its feet.
P. S. I’ll report on other items from the meeting when I have time.