Board Tuesday 22 September 2015 at 5.00pm Meeting to be held at YHN House, Newcastle upon Tyne. Contact: Jill Davison (telephone: 0191 278 8624 email: jill.davison@yhn.org.uk)
AGENDA Introduction items
Timing
1
Reminder to switch off mobile phones
5.00
2
Apologies for absence
3
Declarations of Interest
Page No.
Items for Decision 4
Audit Committee Annual report
5.05
1
5
Vice Chair and Audit Committee Chair appointments
5.15
8
6
Committee and Subsidiary membership
5.20
11
5.25
17
Items for approval 7
Minutes of 25 August 2015
Items for Information 8i
Chairs Items
8ii
Senior Director report
20
8iii
Delegated Decisions
24
8iv
Board Forward Plan
28
8v
Committee minutes: Commercial Committee 12 May Audit Committee 9 July
29 31
To exclude the press and public during discussion of agenda item 9-14 because of the likely disclosure of confidential information. The definitions of what is considered confidential are contained within Section 16 of the Company’s Standing Orders.
Protect not for publication – Items for Decision 9
Approvals for YHN Disaggregation, £6.5m Loan and Governance Improvements
5.30
35
10
Byker Community Trust contract
6.15 (supplemental report)
11
Management Review
6.35 (supplemental report)
12
Health & Safety
6.55
13
Confidential minutes 25 August 2015
130
Protect not for publication – Items for Information 14
Commercial Committee minutes 12 May 2015
132
4 YHN Board Tuesday 22 September 2015 Audit Committee Annual report Report by Chair of Audit Committee
For Information 1.
Background information
1.1
This report provides a summary of the work of Audit Committee from September 2014 to August 2015.
1.2
The purpose of Audit Committee is to make sure that YHN’s internal control systems and risk management systems are effective and meet regulatory requirements. The committee also has responsibility for monitoring performance information and ensuring that there are adequate processes in place to manage and monitor performance within the organisation. The committee ensures that there are proper systems and allocations of responsibilities covering:
1.3
Internal audit;
External audit;
Internal control systems;
Risk Management systems;
YHN’s strategic targets; and
YHN Customer Promises and Local Offers.
The following areas of activity are overseen by Audit Committee:
Monitoring the integrity of the financial statements of YHN and any formal announcements relating to the company’s financial performance, reviewing significant financial reporting judgements contained in them;
Reviewing YHN’s internal financial controls and the internal control and risk management systems;
Monitoring and reviewing the effectiveness of the internal audit function;
Recommending to the Board the appointment of the external auditor; Page 1 of 34
Recommending the remuneration and terms of engagement of the external auditor;
Reviewing and monitoring the external auditor’s independence and objectivity and the effectiveness of the audit process, taking into consideration relevant UK professional and regulatory requirements;
Developing and implementing policy on the engagement of the external auditor to supply non-audit services, taking into account relevant ethical guidance regarding the provision of non-audit services by the external audit firm;
Reviewing Key Performance Indicators (‘KPI’s) and provide assurance that performance monitoring processes are robust;
Reviewing, scrutinising and challenging performance targets and information;
Reviewing and challenging poor performance against targets and downward trends in performance; and
Reviewing, scrutinising and challenging performance and management of risks associated with YHN contractual arrangements.
1.4
The Independent Chair of Audit Committee is George Clark, and the independent vice-chair for the period covered was Paul Scope. The Head of Business Strategy is the lead officer. The committee meets on a quarterly basis, and this report covers the five meetings held between September 2014 and August 2015 (an additional meeting was held to consider in detail the annual accounts and auditor statements).
1.5
Members of the committee take an active part in meetings, providing constructive challenge to the officers that attend. The level of member attendance at the committee during the period was very good, although one independent member experienced problems due to work commitments. Average attendance was 70%.
2.1
Work plan summary
2.1.1 Overview During the period covered by this report, Audit Committee considered a range of regular items covering the regulatory and scrutiny roles of the committee, and one-off reports covering specific issues that fell within the committee’s remit. A summary of work of the committee during the period is covered below, split into sections on regular quarterly or annual items, and one-off reports. 2.1.2 Regular Items
Action list review. An action list covering progress in relation to actions agreed by the committee was considered at each meeting during the period, as part of the scrutiny role. Page 2 of 34
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Internal Audit Progress Update Reports. These were submitted for each meeting by the Head of Internal Audit. Each report covered: o Progress against the annual audit plan of YHN services and areas of activity; o Information about the implementation of Audit Recommendations for each service, including an analysis and details about recommendations not yet implemented; and o Information about performance indicators set for Internal Audit, and performance against these indicators. This often gives the committee its greatest source of concern in relation to the timescales taken to implement some Audit recommendations. This is particularly concerning where full systems reviews are involved and some ‘minor’ recommendations are delayed pending full review where it is the opinion of the Audit Committee that these could have been implemented and improved controls without waiting several months, sometimes years for full implementation. Whilst the committee understands the thinking and logic behind some decisions not to implement, we feel there needs to be a greater discussion with Internal Audit around timescales and those recommendations that could be implemented without incurring any costs to the organisation and not impact on any future system review.
Quarterly Performance Reports. A quarterly report covering performance in relation to our ‘business critical’ targets was considered at each meeting. The reports all covered: o An overview of how performance is reported; o A performance summary report showing performance and trends against the targets; and o An explanation of any issues or concerns. Performance against each target was reported based on a traffic light system, with detailed comments provided for all targets not reported as ‘green’. During the course of the year, robust discussions took place on performance in relation to individual targets covering, for example, void rent loss and sickness absence, and about the need to ensure that performance monitoring was qualitatively led and outcome focussed rather than being process focussed.
Strategic Risk Register. Quarterly reports during the period covered provided background information about risk management as part of our assurance framework. Each report covered a ‘risk at a glance’ analysis of the strategic risks we face as an organisation, based on a traffic light methodology. An appendix to each report focussed on the risks that were identified as’ red’ or ‘amber’ and consequently posed a greater threat, with details about progress made in improving the controls we have in place for these risks. The most recent report in August 2015 identified the changing nature of risks to YHN for 2015-16 as a result of: Page 3 of 34
o Risks that reflect the disaggregation between YHN and NCC; o The increased importance of the income from YHN’s traded services; and o The importance of delivering our services within a fixed management fee.
2014-15 Year End Audit Proposal. In February this year, a report was received from Ernst and Young identifying their proposed approach and scope for the 2015 audit. The report identified key areas of audit emphasis as: o NCC housing services review and disaggregation; o Non-HRA trading activities; o Agreement of key account balances and transactions; o Recoverability of third party debtors; o Pension accounting; and o Financing The proposal was received by the committee following discussions around issues such as any potential conflicts of interest.
Annual Assurance Statement and Report. The Annual Assurance Statement for YHN for 2014/15 was presented to the May meeting. A covering report explained that the statement provides assurance to both the YHN Board and NCC that we have robust systems of internal control and effective governance arrangements. The report identified that the statement covers: o the effectiveness of systems of internal control; and o any significant governance/control issues. The report explained that there were no areas of weakness in terms of systems in place, and that no significant control issues had been identified during 2013-14. The annual assurance statement was agreed by the committee.
Internal Audit Plan 2015-16 and three year strategic audit plan. In February 2015 the committee received a consultation paper from the Head of Internal Audit. The paper gave members an overview of the process for compiling the Internal Audit Plan and provided an early opportunity for members to feed into this process. Discussions at the meeting covered channels through which issues could be fed into the plan, and options for including a tenant scrutiny panel in the process. At the May meeting, a draft Annual Audit Plan for 2015-16 and a three year strategic plan to 2017-18 were proposed. The plans were agreed, subject to further discussions about the timing of the Community Care Alarm Service and Garden Care audits.
Delivery Plan 2015-16. The draft annual delivery plan was considered by the committee in February for approval prior to presentation to the YHN Board for final agreement in March. The report covered: o Links with the Business Strategy; Page 4 of 34
o 19 proposed strategic targets for 2015-16; o Tenant involvement in setting local offers; o Consultation with NCC on HRA focussed targets; and o The draft 2015-16 Service Improvement Programme. Members of the committee raised issues around the complex wording of some of the targets, and there was discussion about the void and sickness absence targets. It was agreed to review the wording of targets, to propose to the Board a sickness absence target, and to recommend the approval of the draft delivery and service improvement plan. 
Annual Report, Financial Statements 2014-15 and Audit Report. At the July meeting, the committee received the Annual Report and Financial Statements and an Audit Report from Ernst and Young, with a covering report by the YHN Financial Controller. The covering report included information about: o Stages in the accounts approval process; o Issues that the committee needed to be aware of, including legal requirements; o Significant changes from previous statements; o The Audit Results Report; and o Possible outcomes. Following discussion, the financial statements and associated reports were agreed by the committee and recommended to the Board for approval.

Internal Audit Annual Report and Opinion of the Head of Internal Audit. This report explained the legal requirement for both an Internal Audit Annual Report and the opinion of the chief audit executive. The opinion in the report was given as satisfactory. The report covered: o A summary of all audit work for 2014-15, providing an overall assessment for each service or area of activity audited during the year; o A comparison of audit work with the audit plan, and a summary of the performance of Internal Audit; o A review of the effectiveness of Internal Audit including an assessment against the Public Sector Internal Audit Standard; and o CIPFA benchmarking information. In discussion about terminology used in the report, it was explained that audit ratings would be changed to provide a clearer picture in future. There was also detailed discussion about the safeguarding and domestic violence audit, and the implications of the Care Act 2014.
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2.1.3
One-off Reports
Evaluation of the Finance Review. In November 2014 the team considered a report on the 12 month evaluation of the Finance review. The report covered: o A brief summary of internal Finance Review findings including support to commercial activity and single point of contact; o The Service Improvement Plan and restructure; o Case studies of work undertaken since the restructure; and o Feedback from Service users (Wider Management Team level) In considering the report, members of the committee welcomed the positive findings of the review.
Business Continuity Plans. This report was a response to some weaknesses identified by Internal Audit in the effectiveness of our business continuity arrangements, including: o Reference to business continuity arrangements in corporate policies; o Clarity around the roles and responsibilities of officers; o Business Impact Assessments not completed for all service areas; and o Retention of outcomes of plan validation testing and details of lessons learned. Business Continuity Plans for three key services were provided as appendices to the report, which also covered progress in relation to weaknesses identified.
Anti-bribery and corruption policy. This report by the Company Secretary covered implementation actions taken between December 2013 and January 2015 following approval by the Board of a revised Anti-bribery policy taking into account the provisions of the Bribery Act 2010. The report outlined a review undertaken by the Company Secretary, and recommendations for further action, covering: o Additional training for Board members; o Reminders to staff around gifts and hospitality procedures; and o A review of sales contract procedures. The proposed further actions were agreed, and it was also agreed to monitor the bribery risk through the strategic risk register. It should also be noted that the Chair of the Audit Committee conducts an annual review of the gifts and hospitality register. This is also linked to a review of YHN spend to see if there is any link between the hospitality offered to the value of business awarded to companies. There were no major issues arising out of this year’s review.
Business Strategy Review Evaluation. In August the committee received a presentation by the Head of Business Strategy covering a review of the Business Strategy Service. The presentation covered information about the different functions of the service, including the service objectives of: o Providing strategic direction; Page 6 of 34
o Supporting income generation; o Driving service improvement; and o Providing assurance. The presentation covered achievements that have come from the reviews of business strategy, customer involvement, communications and equality and diversity between April 2012 and November 2014, issues that still need to be addressed, and next steps including a review of the service structure. The presentation was received, and the Chair commented that the review should be robust and lead to a team structure that is fit for purpose. 3.
Conclusion and recommendations
3.1
Audit Committee has a remit around control systems, risk management, audit and performance, on behalf of YHN Board. This annual report for the period from September 2014 to August 2015 reflects the clear purpose of the committee. All members of the committee have contributed positively in discussing agenda items. It is the opinion of the Audit Committee based on the reports and explanations sought and provided that YHN operates within a sound system of internal control and that processes and procedures are operating as expected.
3.2
Board is recommended to: o Note the work of Audit Committee over the period covered by this report.
Background Papers Audit Committee papers September 2014 to November 2015 Audit Committee terms of reference Contact Officer: If you have any questions about this report that you would like clarifying before the meeting, please contact Louise Horsefield by telephone on 0191 278 8720 or email louise.horsefield@yhn.org.uk
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4
Board 22 September 2015 Vice Chairs and Audit Committee Appointments
5
Report by Chair For Decision 1.
Background information
1.1
The purpose of this report is to seek Board formal approval for the following appointments: 1.1.1 Appointment of Vice Chairs; and 1.1.2 Re-appointment of Audit Committee Chair.
2.
Appointment of Vice Chairs
2.1
The responsibilities of the Board Vice Chair are:
to assist and support the Chair in fulfilling his/her duties and responsibilities;
to deputise for the Chair in his/her absence;
to assume responsibility for a particular area of responsibility or interest as may be agreed by the Board, such as chairing committees;
to meet with the Chair and Chief Executive as required in between Board meetings; and
to undertake such other duties as may be delegated to them by Board.
2.2
Board members were invited to self-nominate and two nominations were received from the L Stephenson and L Doherty.
2.3
The appointments will be effective from 22 September 2015 until the next AGM in September 2016. The Vice Chairs of the Board will each be paid £1,000 per annum.
Page 8 of 34
3.
Re-appointment of Group Audit Committee Chair
3.1
In January 2011, the Board approved the appointment of an independent Chair of the Audit Committee. G Clark was appointed as Chair of the Audit Committee on 25 September 2011 and has now served four terms of office of one year.
3.2
Following a successful review with the Chair in August 2015, the Chair recommends that G Clark should be re-appointed for a fifth term of office. It is proposed that G Clark will continue to be paid a special responsibility allowance of £1,000 per annum.
3.3
The Chair is proposing to bring the Audit Committee Chair appointment in line with Board member appointments with the length of the service agreement being a three year term. This would mean the appointment would be effective from the AGM on 22 September 2015 until the AGM in 2018.
3.4
The committee will be responsible for appointing a Vice Chair at their first meeting following the AGM.
4.
The Business Implications
4.1
Mission and Strategic Objectives: The work of the Board and its Committees makes a significant contribution towards YHN’s strategic objectives.
4.2
Financial Implications: The payment of remuneration for the Board Vice Chairs and the special responsibility allowance for the Chair of the Audit Committee will be met from an existing budget. There is no proposal to increase payments for the period 2015/16.
4.3
Resources (financial, property, technological or human): There are no implications for existing resources. The Company Secretary will support all new appointees.
4.4
Impact on services/performance: The appointment of an external and independent Chair to the Group Audit Committee, who are independent of the Board, will provide YHN with an objective approach to overseeing the work of the Group Audit Committee as well as ensuring that YHN’s practices and processes are efficient and effective.
4.5
Outcomes for tenants/leaseholders: Tenants and leaseholders can be assured that all appointments are made to help improve governance within YHN. Strong governance will ensure the continued delivery of services which help to meet the needs of YHN’s customers and stakeholders.
4.6
Risk (reputation, relationship): YHN has a robust governance structure and all appointments to the Board and Committees help to ensure robust public accountability and oversight. The appointment of an independent Chair to the Group Audit Committee will help strengthen the independence of this committee. Page 9 of 34
4.7
Environmental: There are no environmental implications.
4.8
Legal: All appointments are made in accordance with YHN’s Governance procedures. All appointees will receive a letter of appointment.
4.9
Equality and Diversity and Community Cohesion: None
4.10 Stakeholder Involvement/consultation: None. 5.
Conclusion and recommendations
5.1
Therefore and in accordance with Your Homes Newcastle’s Articles of Association, Board is asked to formally approve the following: 5.1.1 the appointment of L Stephenson and L Doherty as Vice Chairs of the Board with effect from 22 September 2015; 5.1.2 Approve the appointment of G Clark as Chair of the Group Audit Committee for the period 22 September 2015 until the date of the AGM in 2018; 5.1.3 Agree that a special responsibility allowance of £1,000 per annum continue to be paid to G Clark for the period of his appointment.
Contact Officer: If you have any questions about this report that you would like clarifying before the meeting, you can contact Jill Davison by telephone on 0191 278 8624 or email jill.davison@yhn.org.uk
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5
Board 22 September 2015 Committee Membership and Other Board Appointments Report by Chair For Decision 1.
Background information
1.1
Following the completion of Board member reviews and the subsequent discussions at Board regarding the new group structure, I have had an opportunity to consider the committee and subsidiary companies membership.
1.2
From 1 October 2015, YHN will move to a group structure with two subsidiary companies; Abri Trading Limited and Asfaleia Limited.
1.3
Within the governance improvement plan which we agreed at the Board away day in April 2015, a review of our committee structure has been undertaken. At the July 2015 Board, it was agreed that the new committee structure would comprise of; Service and Strategy Delivery Committee, Group Audit Committee and Remuneration Committee.
1.4
This report sets out the proposed membership for the committees, Abri Trading Limited and Asfaleia Limited.
2.
Committee and Subsidiary Membership
2.1
My proposals for committee and subsidiary membership are set out in Appendix One. The changes take into account the appointment of new Board members and I have taken on board comments made during our board member review discussions.
2.2
The recruitment of the independent members of the charity company is ongoing and we hope to be able to confirm them very soon. Board should note we are looking to appoint a tenant as one of the independent members, as well as individuals from a charity and/or community and voluntary sector background into the other positions.
3.
Committee Chairs
3.1
The committee chairs are included in Appendix One.
3.2
Committee Chairs will continue to be paid a special responsibility allowance of ÂŁ1,000 per annum.
3.3
Within the new structure we have reduced the number of committees and
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6
therefore reduced the number of committee chairs from four to two. This saving of £2,000 per annum will be utilised to remunerate the Chairs of the subsidiary companies. 4.
Other Board Appointments
4.1
The Board are invited to consider and approve on an annual basis a number of other board appointments.
4.2
It is proposed that the following Board Members represent YHN during the period:
JCC – Lynn Stephenson and Paul Dutton
Buyback approval process – Ammar Mirza, Marion Talbot, Tony Moore and Lynn Stephenson
Health & Safety Committee – Lynn Stephenson and Tony Moore
Task & Finish Groups – to be confirmed as and when required
Company Appeals panels – Lynn Stephenson
4.3
During the reviews many of the Board members indicated an interest to sit on company appeal panels, I have asked Jill Davison to arrange for these members to receive the adequate training and briefing on the appeals process, so we will have adequate members to cover.
4.4
During the last year, and following representations expressing slight concerns about the potential for conflict of interest we have withdrawn representation on both Leazes Homes Board and Byker Community Trust Board.
5.
Attendance
5.1
Board Member attendance at board and committee meetings for the period September 2014 to August 2015 is attached at Appendix Two.
5.2
May I thank Board members for their continued commitment to YHN, especially as we all have other commitments and responsibilities. The new structure will hopefully relive some pressure as members will be asked to attend one committee and not two.
6.
Council Board Members
6.1
The Council has amended which Councillors represent them on external bodies following the Council meeting on 2 September. This has resulted in one change to the exiting Council nominees with Councillor David Down no longer representing the Council on YHN Board, and Councillor David Slesenger returning to YHN Board.
6.2
Councillor Slesenger was a YHN Board member between 2006 and 2013, and is the current Councillor for East Gosforth ward.
Page 12 of 34
7.
The Business Implications
7.1
Mission and Strategic Objectives: The work of the Board and its Committees makes a significant contribution towards YHN’s strategic objectives.
7.2
Financial Implications: The payment of remuneration for the Board Committee Chairs will be met from an existing budget. There is no proposal to increase payments for the period 2015/16.
7.3
Resources (financial, property, technological or human): There are no implications for existing resources. The Company Secretary will continue to support the Board structure and members.
7.4
Impact on services/performance: YHN has a robust governance structure and all appointments to the Boards and Committees helps to ensure service improvement and continuing performance against objectives.
7.5
Outcomes for tenants/leaseholders: Tenants and leaseholders can be assured that all appointments are made to help improve governance within YHN. Strong governance will ensure the continued delivery of services which help to meet the needs of YHN’s customers and stakeholders.
7.6
Risk (reputation, relationship): YHN has a robust governance structure and all appointments to the Boards and Committees help to ensure robust public accountability and oversight.
7.7
Environmental: There are no environmental implications.
7.8
Legal: All appointments are made in accordance with YHN’s constitution.
7.9
Equality and Diversity and Community Cohesion: The membership of the Board and its Committees have members from each of the three constituent groups (tenants, councillors and independents) which helps to ensure the benefits of being diverse and representative of our communities.
7.10 Stakeholder Involvement/consultation: None. 8.
Conclusion and recommendations
8.1
The Board is asked to: 8.1.1 agree the committee and subsidiary membership and appointment of committee chairs and vice chairs, as set out in Appendix One; and 8.1.2 agree the appointment of Board members to other committees as set out in clause 4.2 above for the period September 2015 to August 2016; and 8.1.3 note the record of Board member attendance for the period September 2014 to August 2015 as attached at Appendix Two. 8.1.4 note the change in council nominated representative, to Cllr David Slesenger.
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9.
Implementation
9.1
Committee membership will take effect from 22 September 2015.
Contact Officer: If you have any questions about this report that you would like clarifying before the meeting, you can contact Olivia Grant by email olivia.grant@yhn.org.uk
Page 14 of 34
Page 15 of 34
Remuneration Committee members: 1. Board Chair 2. Board Vice Chairs 3. Chair, Service and Strategy Delivery Committee 4. Chair, Abri Trading Limited
Neil Scott
Louise Horsefield
Asfaleia Independent (tbc)
Lynn Stephenson (I)
Independent (tbc)
Independent (tbc)
Joyce McCarty (C)
5
David Slesenger (C)
Doreen Huddart (C)
John Reid (T)
7
Phil Dibbs (I)
4
Lorraine Wilson (T)
Marion Talbot (C)
Tony Moore (T)
3
Vice Chair (tbc)
George Clark (IC)
Independent Chair (tbc) Lynn Stephenson (I)
Independent (tbc)
Paul Scope (I)
2
Group Audit
Asfaleia Limited
6
Ammar Mirza (I)
1
Abri Trading Limited
Lead Officer (until April Sheila Breslin 16)
Chair
No
Appendix One - Committee membership from 22 September 2015
6
Lisa Doherty – YHN Vice Chair
Lisa Doherty (T)
David Langhorne
Julie Purvis (T)
Lynn Stephenson – YHN Vice Chair
Buy back - Marion Talbot, Tony Moore, Ammar Mirza JCC – Lynn Stephenson and Paul Dutton H&S Committee – Lynn Stephenson and Tony Moore
Other appointments
Jane Streather (C)
Veronica Dunn (C)
Malcom Page (I)
Elaine Snaith (I)
Service and Strategy Delivery Committee Paul Dutton (T)
Appendix Two - Board Member attendance 30 September 2014 to 31 August 2015
Board
Audit
No of meetings P Dutton L Doherty L Middlemiss J Purvis J Reid T Moore
9 8/9 8/9 8/9 8/9 9/9 8/9
5
V Dunn D Down D Huddart J McCarty J Stokel-Walker* M Talbot
5/9 3/9 8/9 9/9 5/6 8/9
P Dibbs A Mirza N Shukla E Snaith L Stephenson
9/9 7/9 8/9 7/9 8/9
Committees Customer Finance & & Service Resources Delivery 4 4 3/4 4/4
Commercial
Remuneration
5
1 1/1
3/5
5/5
4/4 1/4 4/4 4/4
3/4 1/4 4/5 1/4
3/5 4/5 4/5 1/1 2/4 3/4 1/5 4/5
5/5 5/5
3/4 4/4 2/4
4/5
1/2
*ceased to be NCC nominated member on 5 May 2015
The attendance of board members who joined the Board during the year is:
P Scope** J Streather***
Board
Audit
3/4 2/3
5/5
Committees Customer Finance & & Service Resources Delivery
Commercial
0/2 1/1
** Joined the Board 5 May 2015 *** Joined the Board 16 June 2015
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1/1 1/1 1/1
Board 25 August 2015 (5.00pm to 6.20pm) Present: O Grant (Chair)(until 6pm), P Dibbs (Until 6pm), P Dutton, L Doherty, D Huddart, J McCarty, T Moore, J Purvis, J Reid, J Streather, L Stephenson (Chair from 6pm), E Snaith, M Talbot, L Wilson In attendance: J Davison
Company Secretary
N Scott
Senior Director & Director of Tenancy Services
S Breslin
Assistant Chief Executive & Director of Corporate Services
D Langhorne
Director of Property Services
L Forrest
Head of Finance
D Creighton
Executive Assistant to the Chief Executive
L Horsefield
Head of Business Strategy
D McGuiness
Communications Manager
G Ellingham
Head of IT
C McMullen
Newcastle City Council
M Page
Observer
403
WELCOME The Chair welcomed Board members to the meeting and a special welcome to Malcolm Page who will be appointed as an independent board member in September and is joining the meeting as an observer. The Chair submitted her apologies to the Board due to an engagement she was required to attend she would need to leave the meeting at 6pm, Lynn Stephenson would take the Chair for the remainder of the meeting.
404
APOLOGIES Apologies were received from D Down, N Shukla, A Mirza, P Scope
405
DECLARATIONS OF INTERESTS No interests were declared. The Chair agreed to a change in the order of the agenda and move to the confidential part of the agenda first – Stress Testing Presentation. (Confidential minutes 5.10pm-6.00pm) Lynn Stephenson took the Chair 6.00pm
406
GROUP GOVERNANCE ARRANGEMENTS Submitted: Report by the Senior Director (previously circulated, copy attached to Official Minutes). Page 17 of 34
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Jill Davison presented the report which gave an update on work progressed since the last meeting with regard to the governance of the new group structure. A Group Governance Handbook had been drafted which sets out the scope of the new governance arrangements, this was presented to the Board in draft format for comment by the 4 September. It was proposed that the handbook would be used by all companies in the group structure. The handbook brought together in one place all the governance arrangements and would be available on the internet with weblinks to the referenced documents. This was a live document and could be amended as required. Jill Davison explained that Intragroup agreements had been drafted to regulate the key aspects of the interactions between YHN and the subsidiaries, these were attached as a draft for comment. Jill Davison reported that revised Financial Regulations were due to be presented to Board for comment and approval, but due to a separate review of Financial Regulation 8 – procurement being undertaken this would now be presented to the September meeting. Jill Davison reported that the applications to register the two new companies would require signatures of the members. As the committee and subsidiary membership would not be finalised until after all Board member reviews were completed and then agreed at the September meeting, Board were asked to agree that any four available board members would sign the application forms for registration purposes and could be changed at a later date. The meeting dates for YHN Board 2016 and the workplan were presented for comment and approval. The workplan had been devised in conjunction with the Head of Finance to ensure that quarterly reporting deadlines were met and up to date financial and performance information was brought to Board in a timely manner. Jill Davison notified the Board that an additional meeting would need to be scheduled for October to hear from John Lee on the work he was completing at Newcastle City Council. Questions/Comments A Board member questioned whether any of the current committees would still meet. It was confirmed that only the Customer and Service Delivery Committee on 15 September would meet, the new group structure would come into existence from September 2015 and a new calendar of dates and workplans would be devised. Board members commented that this is the first time the governance documents have been consolidated and it was very useful document, credit was given to Jill Davison and Lisa Forrest for work completed. RESOLVED that the Board;
Agreed to provide comment on the Group Governance Handbook to the Company Secretary by no later than 4 September; and
agreed the Intragroup Agreements to be established between YHN and subsidiary companies, and
agreed to receive amended Financial Regulations in September for approval; and Page 18 of 34
407
agreed that any four YHN Board members are signatories to the company registration applications; and
agreed the YHN Board dates and workplan for 2016.
MINUTES OF 28 JULY 2015 RESOLVED that the Board; Considered the minutes of the meeting held on 28 JULY 2015 and approved them as a correct record. Matters arising – Board members had requested a more detail session to go through the management agreement and Sheila Breslin informed Board these had been scheduled for 3 and 10 September.
408
ITEMS FOR INFORMATION CHAIRS ITEMS No Chairs items were presented
409
ITEM FOR INFORMATION SENIOR DIRECTOR REPORT Submitted: Report by the Senior Director (previously circulated, copy attached to Official Minutes). RESOLVED that the Board;
Received the report for information
……………………………………….. Mrs O Grant Chairman 22 September 2015
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Board 22 Sept 2015 Senior Director’s Report For Information
1.
Introduction
1.1
This report aims to bring Board Members up to date with some of the activity that YHN has been involved with recently as well as with national developments that may be of interest to them as Board Members. This report includes:
Review of Troubled Families Programme Right to Buy extension negotiations Work Capability Assessment deaths Black review into Government provided treatments and benefits entitlement
2
Assessing the effectiveness of the Troubled Families Programme
2.1
The Troubled Families programme was launched in 2011 as a way to improve the lives of families with multiple and expensive problems across England, such as those who miss out on school, engage in crime, display physical and mental health problems, are unemployed or suffer domestic violence.
2.2
The Department for Communities and Local Government (DCLG) has commissioned the Office of National Statistics (ONS) to amalgamate data from different government departments and councils in order to assess the Troubled Families programme, which benefits from action and funding by various public services.
2.3
To ensure the money is being used to “best effect” and current policies are successful, the DCLG will now be able to collect and share evidence of the programme’s effectiveness with local authorities to improve services. It will compare the progress of families who have undertaken the programme with those who have not, combining data from councils about families with information routinely collected from other departments. Page 20 of 34
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2.4
Cross-party information will be used to identify if the programme improved outcomes for families, such as reducing offending and truancy, improving children’s safety and families’ health, as well as getting people into work. YHN’s Family Intervention Project (FIP) dealt with 150 families between 2009 and April 2015. These are families who have more complex needs than those in Newcastle’s Families Programme and therefore provide added value to this area of work. YHN also provides two full time staff to support the cross tenure work of Newcastle Families Programme.
3
Extension of Right to Buy
3.1
The National Housing Federation (NHF) is in talks with the government in an attempt to secure more flexibility under the proposed Right to Buy extension to housing associations. In early August the NHF held a meeting with several housing association chief executives at which it is understood landlords agreed to work with government to find common ground.
3.2
It is understood this could involve a plan under which associations pledge to build more low-cost homeownership properties in return for Right to Buy being adopted voluntarily. This would reduce the risk of the Office for National Statistics reclassifying housing association debt as public.
3.3
Other items understood to be under discussion are possible exemptions for certain types of properties and the idea of a ‘portable’ discount, under which tenants can use money to buy a property other than their current home.
3.4
In mid August the Department for Communities and Local Government (DCLG) confirmed that undefined “local areas” will decide on the tenure of replacement affordable Right to Buy properties.
3.5
Landlords are hopeful that Communities Secretary Greg Clark will announce the outcome of the discussions at the NHF conference in Birmingham on 24 September with full details being available from the Autumn.
4
Work Capability Assessment deaths
4.1
The Department for Work and Pensions (DWP) has released figures showing that 2,380 people died between December 2011 and February 2014 and within 6 weeks of a Work Capability Assessment (WCA) deeming them to be fit to work. The figures related to claims for Employment and Support Allowance (ESA) as well as Incapacity Benefit and Severe Disability Allowance which Ian Duncan Smith had previously claimed did not exist.
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4.2
In 2012 a government advisor appointed to review the Government’s Work Capability Assessment said the tests were causing suffering by sending sick people back to work inappropriately. The tests are said to have improved since then, but as recently as this summer they are still coming in for criticism.
4.3
In June the British Psychological Society said there was “now significant body of evidence that the WCA is failing to assess people’s fitness for work accurately and appropriately”. It called for a full overhaul of the way the tests are carried out. The WCA appeals system has also been fraught with controversy with a very high rate of overturns and delays lasting months as well as being blamed for increases in hardship.
4.4
A Government spokesman said: “These isolated figures provide limited scope for analysis and nothing can be gained from this publication that would allow the reader to form any judgement as to the effects or impacts of the Work Capability Assessment”
5
Treatment and benefit entitlement review
5.1
Dame Carol Black is launching a full-scale review into whether tens of thousands of obese people and those with drug and alcohol problems should be deprived of benefits unless they accept treatment. The review is due to be completed before the end of the year.
5.2
Strong ethical issues will be at stake as the review questions whether such people should continue to receive benefits if they refuse government provided treatment. The review consultation paper however stresses that the purpose of the review is not punitive but to “consider how best to support those suffering from long-term yet treatable conditions back into work or to remain in work”.
5.3
The review is designed to “establish the role such treatable conditions play in causing worklessness and estimate the associated cost to the exchequer and the economy”. It will also consider the groups most at risk of becoming workless through treatable conditions in future and the support available to them, including incentives on employers.
5.4
In May 2014, there were 7,440 working-age disability living allowance claimants whose main disabling condition was obesity. There were also 240 incapacity benefit and severe disablement allowance claimants, and 1,540 people claiming employment and support allowance. But the government believes this underestimates the total number of benefit claimants with obesity, since some of that group will have other main disabling conditions recorded that may be caused, or made worse, by obesity. Based on previous research, the paper also calculates that in August last year “about 280,000 working-age benefit claimants are suffering from Page 22 of 34
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addiction to opiates, and 170,000 from alcohol dependency”. “For about 90,000 people claiming employment and support allowance, their illness is primarily due to their drug or alcohol addiction. Of these, about 8,000 have been claiming incapacity benefits for five years or more.” 5.5
Current government estimates suggest “harmful alcohol consumption costs about £3.5bn per year to the NHS, £11bn in crime and more than £7bn to the economy in lost productivity, and the societal costs of drug addiction are estimated to be £15.4bn”. In addition, the Department of Health estimates costs of more than £5bn a year to the NHS and £27bn to the economy from obesity, with almost 25% of adults and about 15% of children being obese.
5.6
Opponents of this review have stated that it is an example of bullying people with complex problems and needs and that to single out people affected by weight or addiction problems creates easy scapegoats when effective health support is needed.
Contact Officer: If you have any questions about this report that you would like clarifying before the meeting, you can contact Diane Creighton, Executive Assistant to the Chief Executive on 0191 278 8701 or diane.creighton@yhn.org.uk
Page 23 of 34
Page 24 of 34 Additional £85,665.28 from the Lifecycle Programme
Pooley Road environmental & communal upgrade
Garage Roof Replacement & Refurbishment
Make Your Own Money
David Langhorne 2 Property Services
David Langhorne 3 Property Services
David Langhorne 4 Property Services
Sheila Breslin 5 Corporate Services
8iii
£117,000 from Environmental Work and Communal Areas
Int0009 Internal Elemental - Bathroom Programme Phase 2
£30,000 from Employability Projects budget
£1,541,240 from the Lifecycle Programme
ENV0014 Diamond Row
Cost/ Budget provision
£1,800,000 from Environmental works on estates
Scheme
David Langhorne 1 Property Services
No. Delegated Officer
Directorate/
N/A
210
111
727
235
Units
Cross City
Cross City
Sustainable Enterprise Strategies
Denton and Fenham
Cross City
Walker
Wards
Hodgson Sayers Ltd
Open View Security Solutions LTD
BCE
Highways and Localised Services
Contractor
Clarke, Stuart (YHN)
Harrison, Kevin (YHN)
Waters, Lynn (YHN)
Palmer, Chris (YHN)
Dixon, Den (YHN)
Officer
Delegated Decisions – Schedule of non-confidential Delegated Decisions taken between 7th July 2015 and 4th September 2015
Board Tuesday 22nd September 2015
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Directorate/
INT0013 Kitchen Replacement Programme (NEP)
David Langhorne 8 Property Services
£255,283.24 from Environmental Work and Communal Areas
WAN Upgrade
Pooley Road Balcony Infills and Communal Works
Lindfield Avenue ( PB Project 7)
Anson Place -PB 43 round 1
YHN 6 month Pilot project
David Langhorne 10 Property Services
David Langhorne 11 Property Services
David Langhorne 12 Property Services
Sheila Breslin 13 Corporate Services
£10,000 from HR Hired Services budget
£11,066.61 from the Participatory budget
£41,380.44 from the Participatory budget
£43,431.00 from Tenant Investment Priorities
Sheila Breslin 9 Corporate Services
£2,000,000 from the Lifecycle Programme
Fourstones New build
Cost/ Budget provision
£393,026.60 from New Build and Acquisitions
Scheme
David Langhorne 7 Property Services
No. Delegated Officer
N/A
30
30
76
59
475
3
Units
Woolsington
Highways ( Communities Directorate)
Cross City
Blakelaw
Highways ( Communities Directorate)
Relate
Fenham
Cross City
Cross City
Denton
Wards
Brims Construction Ltd
Virgin Media
Morrisons Ltd
Meldrum
Contractor
Elder, Beverley (YHN)
Hutchinson, Mark (YHN)
Hutchinson, Mark (YHN)
Harrison, Kevin (YHN)
Worland, Kirste (YHN)
Cairns, Andrew (YHN)
Hutchinson, Mark (YHN)
Officer
Page 26 of 34
Directorate/
PB0008 Central Walker Environmental
Brunswick Gable Ends
Participatory budget Low Value Schemes
David Langhorne 17 Property Services
David Langhorne 18 Property Services
David Langhorne 19 Property Services
8iii
North Kenton 5 Storey Demolition
Milecastle House remodelling scheme Home Loss & Disturbance payments Bamburgh House remodelling scheme Home Loss & Disturbance payments
Scheme
David Langhorne 16 Property Services
David Langhorne 15 Property Services
David Langhorne 14 Property Services
No. Delegated Officer
£65,000 from the Participatory budget
£80,000 from Health and Safety programme
£350,000 from the Participatory budget
Additional £36,300 from Demolition - Regeneration
£244,002 from Sheltered housing remodelling
£244,002 from Sheltered housing remodelling
Cost/ Budget provision
Citywide
40
53
74
33
33
Units
Walker East Gosforth & West Gosforth
Cross City
Building and Commercial Enterprise Building and Commercial Enterprise
Fawdon
Westerhope
Walkergate
Wards
HLS NCC
Thompsons of Prudhoe
N/A
N/A
Contractor
Giles, Joanne (YHN)
Giles, Joanne (YHN)
Nichol, Philip (YHN)
Parker, Patrick (YHN)
Waters, Lynn (YHN)
Waters, Lynn (YHN)
Officer
Page 27 of 34
ÂŁ2,300,000 from the Lifecycle Programme
INT0011 Citywide Bathroom Replacements
INT0010 Bathroom Replacements
David Langhorne 20 Property Services
David Langhorne 21 Property Services
ÂŁ980,000 from the Lifecycle Programme
Cost/ Budget provision
Scheme
Directorate/
No. Delegated Officer
Cross City
Delta Electrical and Mechanical Services Ltd (NEP Procured)
Cross City
Wards
Contractor
503 Aqua Interiors
1250
Units
Cairns, Andrew (YHN)
Cairns, Andrew (YHN)
Officer
Board 22 September 2015 Board Forward Plan 1
Board Forward Plan
1.1
This Board Forward Plan lists the reports known at the present time that will be presented at the Board meeting on 3 November 2015 (or amended date subject to confirmation)
Board Reports Quarter two performance and financial report
Non-confidential
HCA bids update and new build progress
Non-confidential
New Build Coniston Court
Non-confidential
Annual Lettings review
Non-confidential
Digital by Choice update
Non-confidential
Health and Safety Report
Non-confidential
Universal Credit update
Non-confidential
Senior Directors Report
Non-confidential
8iv Contact Officer: If you have any questions about this report that you would like clarifying before the meeting, you can contact Jill Davison, Company Secretary by telephone on 0191 278 8624 or email jill.davison@yhn.org.uk
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1
Commercial Committee 12 May 2015 (4.00 pm - 5.15 pm) Present: A Mirza
(In the Chair)
P Dibbs and J McCarty In Attendance: Neil Scott Louise Horsefield Jason Wylie Andrew Waters Christine Patterson 35
- Director of Tenancy Services, YHN - Head of Business Strategy, YHN - Head of Business Services, YHN - Sales and Marketing Manager, Palatine - Democratic Services Officer, NCC
APOLOGIES FOR ABSENCE Apologies for absence were received from Tony Moore and Paul Scope.
36
DECLARATIONS OF INTEREST None
37
MINUTES OF PREVIOUS MEETING HELD ON 20 JANUARY 2015 RESOLVED – That the Minutes of the previous meeting held on 20 January, 2015 were agreed as a correct record and signed by the Chair. Matters Arising: None
38
ACTION LIST REVIEW
8v
N Scott introduced the item, explaining that the roof repairs to Palatine were nearing completion. In light of concerns raised at the previous meeting, he asked the Committee to consider holding the next scheduled meeting at Palatine. RESOLVED – That: (i)
The Action List was received.
(ii)
The next meeting scheduled on 21 July 2015 to be held at Palatine.
Page 29 of 34
2
39
EXCLUSION OF PRESS AND PUBLIC RESOLVED – That the press and public be excluded during discussions of agenda items 6-9 because of likely disclosure of confidential information. The definitions of what was considered confidential were contained within Section 16 of the Company’s Standing Orders.
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1
Audit Committee 9 July 2015 (5.00 pm - 6.05 pm) Present: P Scope D Down J Reid N Shukla L Stephenson
(In the Chair)
IN ATTENDANCE S Breslin L Forrest N Scott D Langhorne J Clifford R Burns P Slater J Miller 43
Director of Corporate Services and Assistant Chief Executive Head of Finance Director of Tenancy Services Director of Property Services Financial Controller Lead Service Quality Officer Internal Audit Democratic Services
APOLOGIES FOR ABSENCE Apologies for absence were received from G Clark, L Doherty and A Mirza.
44
DECLARATIONS OF INTEREST IN ANY MATTER TO BE DISCUSSED AT THE MEETING None.
45
MINUTES OF MEETING HELD ON 21 MAY 2015 The minutes of the meeting held on 21 May 2015 were approved as a correct record and signed by the Chair.
46
ACTION LIST REVIEW RESOLVED – that the action list be noted and update accordingly.
47
FINANCIAL STATEMENTS AND AUDIT RESULTS Page 31 of 34
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2
Submitted: Report by Financial Controller (previously circulated and copy attached to Official Minutes) J Clifford introduced the report which introduced the YHN Financial Statements for the financial year 2014-15, which had been prepared in conjunction with EY, YHN’s external auditors. The following issues/comments/queries were raised in debate: In response to a member’s request, it was agreed that in future the number of leasehold properties for Newcastle City Council (NCC) and BCT (Byker Community Trust) would be identified separately. It was noted that performance on key performance indicators would be reported to committee throughout the year. Members were advised that the equal pay claims were historic claims, following audit testing there were 9 claims in total. NCC had given an assurance that there were no other claims outstanding. RESOLVED – that Audit Committee note the independence and objectivity in respect of the relationship between YHN and Ernst Young and recommend to Board for approval: i. The Directors’ report; ii. The Strategic report; iii. The financial statements; and iv. The letter of representation. 48
INTERNAL AUDIT ANNUAL REPORT AND OPINION OF THE HEAD OF INTERNAL AUDIT Submitted: Report by Head of Internal Audit (previously circulated and copy attached to Official Minutes) P Slater introduced the report which set out the Internal Audit Report and Opinion of the Chief Audit Executive (Head of Internal Audit) as required by the Public Sector Internal Audit Standard (PSIAS) 2013. It also provided to support an annual review of the effectiveness on internal audit. The following issues/comments/queries were raised in debate: In response to a member’s comment as to whether the audit rankings of ‘adequate’ etc were appropriate, P Slater advised that the terminology used for the audit rankings was to be changed. In future there would be a range of audit ratings from ‘full assurance’ to ‘no assurance’, which would provide a clearer message. It was also proposed to separate out the efficiency and value for money recommendations from the ratings and include reference to them in the body of the report. In response to a members’ query it was explained that the safeguarding and domestic violence audit had been a specific audit based on the recommendations of a domestic homicide review, rather than a comprehensive review of domestic violence and safeguarding. The audit had focused upon issues of process and training. Since the audit a great deal of training and awareness raising in relation to domestic violent had been undertaken. Page 32 of 34
3
It was noted that the Care Act which came into force in April 2015 had introduced extra responsibilities around safeguarding. Policies and procedures had been reviewed in response. This work had been reported back to the Newcastle Safeguarding Adults Board. It was noted that safeguarding activity was reported to Board on an annual basis. Members’ queried whether there was a need for a wider domestic violence/ safeguarding audit at some point in the future.
RESOLVED – that the report be received. 49
AUDIT PROGRESS REPORT Submitted: Report by Head of Internal Audit (previously circulated and copy attached to the Official Minutes) P Slater introduced the report which showed Internal Audit activity since the last Audit Committee meeting in May 2015. The following issues/ queries/ comments were made in debate:
It was noted that the IT audit work scheduled to cover the Council had been extended to YHN also. This slight revision would give YHN a wider breadth of IT coverage. Car Mileage audit - it was noted that YHN had adopted NCC’s Corporate Travel Policy and Travel and Subsistence Policy and, therefore, changes to policy were reliant on NCC updating their policy which they were committed to but were yet to complete. YHN had revised and strengthened recording and authorisation for mileage claims. This was working effectively as confirmed by the recent Car Mileage follow up audit. On this basis it was agreed that the reference to the car mileage audit be removed from the progress report in future. L Stephenson indicated that she wished to be involved in the Garden Care and Community Care Alarm Service audits. Monthly Fire Inspections – in response to a members’ query as to whether there had been an unacceptable level of risk, N Scott explained that there was a fire inspection regime in place; the inspections were being carried out but the fact that they had been carried out had not always been recorded. It was agreed that information on previous failings regarding monthly fire inspections and the actions that had been put in place in response be submitted to the Health and Safety Committee, with a verbal update at the next Audit Committee. Order, receipt and replenishment of cleaning materials – N Scott advised that the system had previously relied on manual stock controls, new controls had been implemented which should prevent these problems happening in the future. Community Care Alarm Service (CCAS) Audit – N Scott explained there were a number of recommendations in the audit which involved a number of actions, the vast majority of which had been completed. Those which were outstanding were a small number of actions within the broader group of recommendations. He reported that the current maintenance contract with Page 33 of 34
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4
Jontek could be extended by up to two years, consideration was being given to whether or not to extend that contract. He undertook to provide an update on the decision taken on the procurement of Jontek at the August meeting. Repairs and Maintenance audit – D Langhorne confirmed that where there were found to be errors on claims repayment that incurred costs for YHN, these costs were recovered from the contractors. Work had taken place to improve the systems and processes to reduce these occurrences in the future. Investment Programme – Contract Monitoring – in response to a member’s query D Langhorne explained that some key improvements to the process had been identified and a result interventions had been put in place which would improve the processes moving forward
RESOLVED – that progress against the Internal Audit plans for 2014/15 and 2015/16 and the implementation of the audit recommendations be noted. 50
ANNUAL ASSURANCE STATEMENT Submitted: Report by Director of Corporate Services and Chief Executive (previously circulated and copy attached to Official Minutes) RESOLVED – that the report be noted.
51
DATE AND TIME OF NEXT MEETING Thursday 20 August 2015 5pm – 7pm
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