PAC - Approved Committee Minutes - 6 July 2015

Present

Deputy A.D. Lewis , Chairman

Deputy S.M. Wickenden, Vice-Chairman Connétable C.H. Taylor

Deputy J.A. Martin

Mr. G. Drinkwater

Mr. R.J. Parker

Mr. M.J. Robinson

Apologies

Absent

In attendance

Mrs. K. McConnell, Comptroller and Auditor General (C&AG) Mr. I. Clarkson, Committee Officer

Ref Back

Agenda matter

Action

A1.  Records of Meetings

The minutes of the meeting held on 15th June 2015 were approved and signed.

Officer

A2.  Conflicts of Interest

No new conflicts of interest were declared.

Item A3 15.06.15

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A3.  Visit to National Assembly for Wales

The Committee considered a report concerning the visit by a delegation of the Committee to the National Assembly for Wales on 23rd – 24th June 2015,

It  was  reported  that  discussions  with  representatives  of  the  Public Accounts Committees of Wales and Northern Ireland had been most productive. Matters considered included: the remits of each committee; the physical environment in which the Wales PAC operated; meeting procedure;  work  programme  development;  and,  executive  response times.

Regarding work programme development, the Committee was apprised of provisional interest shown by all parties in either information sharing, or collaborating on a possible review of, non-executive appointments to the  boards  of  arms-length  bodies,  senior  management  pay  and compromise  agreements.  The  Chairman  had  also  discussed  with Deputy J.A.N. Le Fondré the possibility of engagement via the British Irish  Parliamentary  Assembly  on  the  topic  of  non-executive appointments.

On  the  matter  of  response  times,  it  had  become  apparent  to  the delegation that the Wales PAC tended to receive responses to Auditor General reports within a period of 4 weeks. There were also indications that the Wales PAC tended to experience less difficulty in securing information promptly during the course of its reviews.

The Committee, having noted the report, instructed its officer –

1. to  prepare  a  report  for  the  Committee's  consideration comparing the terms of reference of the Committee with its Northern Ireland and Wales counterparts; and,
2. to circulate for the Committee's information a confidential sample of a draft issues paper prepared for consideration by the Wales PAC;
3. to make arrangements for additional pre-meetings of the Committee in advance of any future public hearings, so as to afford the Committee additional time to prepare questions for witnesses; and,
4. to  ensure  that  the  Committee's  section  in  future  States Assembly Annual Reports would quote executive response times relating to both C&AG and PAC reports.

Officer

Item A4 15.06.15

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A4.  Work Programme

The  Committee  noted  a  report  concerning  the  status  of  its  work programme for 2015 and beyond.

The Committee recalled that on 23rd June 2015 the States Assembly had  been  apprised  of  an  unsolicited  written  offer from  the  ultimate owner of the Airtel telecommunications business in the Channel Islands that, if accepted by the States, would reportedly lead to –

1. the merging of the JT Global and Airtel businesses, and
2. the sale of a minority interest in the merged entity.

It was further understood that the Corporate Services Scrutiny Panel was  being  briefed  on  the  matter  and  was  considering  launching  a review of the proposal. In this regard, the Committee noted that the nature and speed of the executive response to the recommendations made by the C&AG in her report The States as Shareholder: Jersey Telecom' (R.109/2014 refers) could be expected to have a material bearing on the handling and outcome of the offer received.

The Committee resolved to defer a follow-up review of R.109/2014 until such time as the status of the offer and the related interest of the Corporate Services Scrutiny Panel had been clarified.

Item A5 15.06.15

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A5.  Financial Management

The Committee was most disappointed to note that it had not yet been supplied with a final response from both the Chief Executive and the Treasurer  of  the  States  to  the  C&AG's  report  concerning  financial management (R.38/2015 refers).

The Committee noted that it had been waiting in excess of 13 weeks for a  formal  response  to  the  C&AG's  report.   Moreover,  no  further information had been made available regarding the date by which the

Committee could expect to receive the response. This extended delay was  regarded  by  the  Committee  as  indicative  of  a general  lack of respect by the executive for a States-appointed committee and for the democratic  process  in  general.  In  this  regard,  the  Committee,  with reference to its Minute No. A3 of this meeting, noted –

1. that it was not unknown for its counterpart at the National Assembly for Wales to receive government responses to Auditor General's reports and PAC recommendations within 2 weeks, albeit that 4 weeks tended to be regarded as the default timeframe for the provision of such responses, and

2. that whereas the default period for government responses in  Wales was  broadly  consistent  with  the  C&AG's experience  having  worked  in  other  public  sector environments,  the  time  taken  by  some  executive departments in Jersey to respond to the Committee was notably  longer  than  the  C&AG  could  recall  having experienced elsewhere.

The  Committee  noted  the  intention  of  the  Chairman  to  brief  the Chairmen's  Committee  on  the  position  during  the  course  of  that committee's meeting on 7th July 2015 and recommended, subject to the  outcome  of  the  Chairmen's  Committee  discussion,  that  the Chairman consider asking a suitable oral question of the Chief Minister during the States Assembly meeting of 14th July 2015.

Chair / Officer

512/23

A6.  Internal Audit (PAC.3/2014)

The  Committee  considered  the  response  of  the  Chief  Executive  to recommendation 1 of the Internal Audit report PAC.3/2014, which had been  presented  to  the  States  by  the  Committee  as  previously constituted.

The  Committee  noted  that  the  response  was  significantly  overdue. Recommendation 1, which had ostensibly been accepted, had called for the Chief Executive to submit a report to the Committee by the end of February 2015 explaining how the Corporate Management Board had prioritized  the  achievement  of  a  robust  corporate  risk  management framework. In fact, the response had been supplied 4 months after the agreed deadline.

The Committee was advised that specific clarification had been sought as to whether any of the supplied appendices to the response should be classified as confidential. No such clarification had been offered and none of the documents had been protectively marked.

The Committee noted the response and further noted that the audit plan of the C&AG allowed for related follow-up work to be undertaken in due course.

Item A8 15.06.15

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A7.  Financial Directions

The Committee considered a draft report and agreed that a series of amendments to the same should be made.

In revising the draft report, the Committee was particularly mindful that

some 11 months had passed since the recommendations of the C&AG had been published and that each of the recommendations had either been accepted in full or in principle by the executive. It was also mindful of the scope for impact on the control framework of the States that the substantial change programme being undertaken by the States could reasonably be expected to have. On that basis, the Committee agreed that its recommendations should be framed so as to make it clear that, in  the  opinion  of  the  Committee,  implementation  of  fully  and appropriately reworked Financial Directions should be achieved before September 2016.

The Committee's officer was instructed to prepare a suitably revised draft report for consideration as soon as possible.

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Item A7 15.06.15

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 A8.  Public Sector Reform

The Committee reviewed the transcript of the public hearing held on 15th June 2015.

The  Committee  instructed  its  officer  to  obtain  a  breakdown  of  the monies expended on the Housing Transformation Programme, having been advised during the public hearing that the sum of £685,000 had been accounted for as Public Sector Reform programme expenditure.

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Item A9 15.06.15

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 A9.  Comptroller and Auditor General – Work Programme

The Committee –

1. noted the presentation to the States of the C&AG's s summary report on information security (R.75/2015 refers) and that the Chairman had written to the Chief Executive, States of Jersey  seeking  a  response  by  31st  July  2015  to  the recommendations made in that report; and,
2. received  an  oral  briefing  regarding  the  status  of  the Jersey Audit Office Audit Plan.

Deputy S.M. Wickenden was not present for this item.

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