To receive any questions relating to items on the Agenda from members of the public and replies thereto.
Minutes:
Mr Nick Quinn, a local resident, stated that his questions concern: Agenda Item 12 – Grant Thornton Findings 2019/20.
Firstly; on page 21 of the report, at the bottom of the ‘Findings’ column, the auditors refer to ‘3 Rivers Governance Reports’ and ‘the 17 recommendations approved by Cabinet’.
The Auditors state that the most critical of these recommendations is:
“That 3 Rivers Developments Ltd suspends any new site purchases and the commissioning of work relating to sites where construction has yet to be started, until the appointment of new Directors, in accordance with recommendations 3 and 4, has been completed and their subsequent updated business plan has been approved”.
They continue: “For clarity, recommendations 3 and 4 relate to the recruitment of a Finance Director with construction industry experience to replace Mr Jarrett, as soon as possible, and a suitable Director or Non-Executive Director with regional property development experience to complement and strengthen the existing board arrangements”.
My question on this section is:
If the Auditors were confident that these recommendations are suitable to be made in an open report - why did Audit Committee judge, at their last meeting, that they should be withheld from the Mid Devon Public?
Secondly; on page 27 - in the ‘Impact of Unadjusted Misstatements’ section, the Auditors make reference to the agreed settlement of a ‘longstanding contractual dispute’ which is likely to cost the Council around £600,000.
The loss of £600,000 will have a significant impact on the Council finances this year and it will, no doubt, affect the Mid Devon Council Tax payer.
My question on this section is:
In the light of this loss - Will Audit Committee be asking for any actions to be taken?
The Chairman thanked Mr Quinn for his two questions and stated that he would begin by responding to the first question:
The meeting held on the 23rd June 2020 was a special Audit meeting to consider the 3RDC governance review documents.
The report was some 122 pages in total and encompassed an amount of detail that is considered exempt, this included details of commercial confidentiality and personal data.
The approach taken was consistent with that taken across all MDDC meetings when considering part two discussions, that being committee are asked to consider the item to be discussed and to decide if they wish to hear the item in part two.
At the meeting of the 23rd June this was the approach taken by myself as chair and after a round table discussion committee voted to hear the report in part two.
This was again consistent with the discussions and outcomes at the Cabinet and scrutiny meetings that had previously considered the same reports.
With regard to the second question, the Chairman stated that, save for the fact of settlement and the amount, the details of the dispute are subject to a settlement agreement – and therefore confidential.
This was a longstanding contractual dispute which could have resulted in high-risk, high stakes litigation. The dispute has now been settled to provide certainty and minimise the risk to the Council. A confidential briefing paper will be provided to Members shortly and the Audit Committee may follow this up as they then see fit.
The settlement has been made from the Housing Revenue Account (HRA) and the deduction backfilled from the HRA reserves. For those reasons, there will be no direct impact upon the Council’s finances this year and no direct impact upon the Mid Devon Council Tax payer.