REPORT C

DEPARTMENT

Social Care, Health & Housing

AUDIT REVIEW

Supporting People Grant 2013/14

AUDIT REF

3314007

PLANNED DAYS

15

ACTUAL DAYS

40

Frequency of Audit

Annual

Background

The Supporting People Programme began in 2003. Its purpose is to provide housing related support to help vulnerable people to live as independently as possible. Initially it was administered jointly between the Welsh Government and Local Authorities. Subsequently the Supporting People Programme was subject to an independent review which recommended the introduction of a single Supporting People funding stream, which meant from 1st August 2012 Local Authorities were solely responsible for administering and delivering the scheme. Whilst it is appreciated that the Social Care and Housing Department (the Department) inherited a number of schemes from Welsh Government to manage it meant that arrangements were not in place for these schemes and the Department would need time to implement our procedures. This review and its findings do in fact relate to both Carmarthenshire’s schemes as well as the inherited ones. Internal Audit has been involved in this claim’s audit (2013/14) for the past two years and has identified significant weaknesses and issues which have been reported to management, and an action plan agreed to be delivered by the Department.

The total funding in relation to Supporting People received from Welsh Government for the period 2013/2014 was 6,777,746. Welsh Government require a certificate to be completed and signed by the s151 officer. Internal Audit reviews the arrangements and procedures in place to provide the s151 with an opinion on the arrangements in place. Welsh Government set deadlines for the submission of this claim with the final audited claim expected by 30 September 2014. Even though numerous requests and reminders were sent to the Department by Internal Audit for this claim the first draft claim was not received by Internal Audit until 10 December 2014.

As at May 2015 the situation is that the 2013/14 grant has been paid to Carmarthenshire in full by the Welsh Government but due to the delay in submission of the 2013/14 claim they have withheld two quarter payments from 2014/15 funding, resulting in approximately 3m grant being held back until the grant certificate is submitted when the monies will then be paid over to Carmarthenshire.

Scope

To enable the s151 officer to sign the Supporting People grant certificate our review covered the controls and procedures in place for the management and administration of the Supporting People grant to:

    assess the extent to which the Authority’s Financial Procedure Rules and

    the grant terms and conditions are being fully complied with.

The Terms and Conditions laid down by Welsh Government specify that an audit certificate is required to be provided stating that ‘the project’s aims and objectives and the grant offer had been considered and that the entries are fairly stated and the expenditure has been properly incurred in accordance with the offer of grant.’

General Opinion

The review had been assessed as being of high risk to the Authority due to:

    issues identified during the previous Internal Audit review and

    the grant conditions specify the requirement that an audit certificate be provided.

Following the audit work carried out the review remains as high risk due to the issues that continue to remain outstanding relating to the management and administration of the grant.

Summary of Results

This review identified significant weaknesses in the management and administration of the grant this year again. In particular, the standard of documentation retained, and the evidence available to support eligibility and outcomes continued to be poor despite issues being previously raised by Internal Audit. Insufficient evidence available to enable an assurance to be placed that grant terms and conditions, the Project Grants Manual and the Authority’s Financial Procedure Rules had been fully complied with.

Issues identified

    1. Non-compliance with the Authority’s Financial Procedure Rules. (FUNDAMENTAL WEAKNESS)

    In particular:

    1.1 Some contracts specified that payments would be made monthly in advance although there was no evidence available that the Department had sought authorisation to make advance payments, as payments in advance are not permitted without prior approval

    1.2 There was often insufficient documentation available to support expenditure. Transfer of monies to in-house service provision, values were being transferred without any documentation available to demonstrate that the expenditure was eligible and in accordance with grant criteria

    1.3 There was a lack of backing documentation to support payments to providers

    2. Non-compliance with the Authority’s Contract Procedure Rules. (FUNDAMENTAL WEAKNESS)

Out of 154 supporting people contracts Internal Audit were advised by Supporting People that only 12 had current, signed copies available (only 10 could be provided to Internal Audit). These had all been signed by a representative of CCC.

Of these 10, only one was in place and signed prior to April 2014, ie the grant certificate period.

In summary the issues arising in respect of contract procedures are as follows:

    2.1 Awarding of contracts in the majority of cases had not followed the appropriate tendering / quotation process

    2.2 Documentation for contracts are not maintained

    2.3 The majority of providers do not have up to date contracts

    2.4 Contracts were not always signed by a representative of Carmarthenshire County Council

    2.5 Evidence of approval was not available to support contracts that had been extended

    2.6 Evidence of approval of exemption for WG handover schemes was not available

    2.7 There were no SLA’s available in respect of services provided in-house. However, some have since been developed since the matter has been raised as part of the audit

    2.8 Where there are contracts in place there was no monitoring undertaken to ensure that providers were only getting paid the values specified in the contracts. Internal Audit have been advised that a spreadsheet is now being maintained detailing such checks

    2.9 In accordance with the Financial Procedure Rules an exception from following the Regulations can be applied for from the s151 Officer, Monitoring Officer and the Executive Board Member. The Department had requested an exemption from the tendering process to extend the contract dates that have expired or due to expire as well as for those contracts inherited from WG, to enable them to have time to go through the proper tendering process. The initial information provided was insufficient for a decision to be made and exemption to be granted. To enable a decision to be made further information was requested from the Department initially in April 2014 and followed up in September 2014. This information was presented to the s151 officer in April 2015 which was 12 months after the expiry of the 2013/14 financial year.

    3. Insufficient monitoring arrangements of the grant (FUNDAMENTAL WEAKNESS)

    3.1 Eligibility of participants is not routinely undertaken. Internal Audit was advised that eligibility is checked during the ‘3 yearly’ monitoring visits although many of these have not been undertaken since 2007 due to resource issues. Of the sample of providers selected none had received a monitoring visit during the grant period being reviewed. As a result it was not possible to ensure that payments had only been made in respect of eligible participants

    No evidence of adequate monitoring to ensure that third parties’ delivered the service as required by the terms and conditions of the grant.

    We are informed that a spreadsheet has recently been developed to record visits to providers but it does not document what has been reviewed as yet.

    3.2 No evidence retained to demonstrate that the project was being managed appropriately and progressing as expected

    3.3 Whilst monthly monitoring returns are completed by providers and quarterly meetings are held where providers may discuss issues, there is no evidence available to confirm that overall monitoring of the progress of the grant including total project outputs against targets, project finances, etc as required by the Project Grants Manual, has been undertaken on a regular basis.

    3.4 Supporting People staff collate financial information from third parties but they do not check to ensure that this information which is being provided to Welsh Government is accurate

    3.5 Details of outcomes required by the grant are submitted by providers. These are not checked to ensure details are accurate or that set outcomes are being met

    4 Other grant conditions that have not been met are as follows:

    4.1 The publicity requirements of the funding body had not been fully adhered to. The Terms and Conditions clearly state that the Welsh Government’s contribution must be acknowledged on all press releases, publicity, communication materials and signage. However no documentation has been provided to evidence that the Welsh Assembly Government’s publicity requirements have been complied with.

    5 Documentation

    5.1 Documented procedures had not been formulated for key activities; There are some documented procedures / flowcharts / etc available although certain procedures have not been covered eg monitoring of third parties / outputs, day to day tasks, roles & responsibilities; and those that exist need to be improved to cover such things as roles & responsibilities

Due to the fundamental weaknesses identified, the review of the Supporting People Grant will remain as high risk until the issues identified are resolved and the overall management and administration of the grant is significantly improved.

RECOMMENDATION

It is crucial that Supporting People Staff remain committed to ensuring improvements continue to be made ultimately resulting in the requirements of the grant terms and conditions as well as the requirements of the Authority’s Project Grants Manual and Financial Procedure Rules being fully complied with.

Failure to fully comply with the requirements of these documents including having adequate supporting documentation available puts the Authority at risk of having grant monies reclaimed or the de-commitment of funds by the funding body as well as putting at risk any future funding applied for by the Authority.

Target Date – Ongoing

Responsible Officer – Supporting People Manager

RECOMMENDATIONS

OVERALL ASSURANCE

Priority 1- Fundamental

Weaknesses

3

(See Issues 1,2, & 3)

LOW

Priority 2 – Strengthen

Existing Controls

2

(See Issues 4 and 5)

Priority 3 – Minor Issues

0