Confirmed Minutes of the Public Health Wales (PHW) Audit and Corporate Governance Committee Meeting 6 September 2016, 12:30pm Venue: Life Sciences Hub Wales, Assembly Square, Cardiff Bay Present: Kate Eden (KE) Terence Rose (TR) Carl Clowes (CC) In Attendance: Huw George (HG) Quentin Sandifer (QS) Phil Bushby (PB) John Lawson (JL) Martyn Pennell (MP) Paul Dalton (PD) Jayne Gibbon (JG) Gabrielle Smith (GS) Melanie Westlake (MW) Andrew Richardson (AR) Stephanie Wilkins (SW) Secretariat: Claire Morgan (CEM) Apologies: Rhiannon Beaumont- Wood Tamira Rolls Jason Garcia Anthony Veale Non Executive Director and Committee Chair Non Executive Director Non Executive Director Deputy Chief Executive and Executive Director of Finance and Operations Executive Director of Public Health Services/Medical Director (part of meeting) Director of People and Organisational Development Chief Risk Officer Head of Financial Services and Control NHS Wales Shared Services Partnership Audit and Assurance Services (Internal Audit) NHS Wales Shared Services Partnership Audit and Assurance Services (Internal Audit) Wales Audit Office (External Audit) Board Secretary and Head of Corporate Governance Interim Corporate Governance Manager Trade Union Representative Corporate Governance Officer Executive Director of Quality, Nursing and Allied Health Professionals Deputy Director of Finance and Head of Finance Wales Audit Office (External Audit) Wales Audit Office (External Audit) Date: 6 September 2016 Version: v1 Page: 1
Item.ACGC.25 Welcome and Apologies for Absence The Chair opened the meeting and welcomed all present, she explained that she had taken over the role of Chair from TR following the review of committees within the organisation. TR would take on the role of chair of the newly established People and Organisational Development Committee. The Chair extended her gratitude to TR for his stewardship of the Committee. Apologies for absence were noted. CC joined the meeting via telephone from North Wales. Item.ACGC.26 Declarations of Interest There were no declarations of interest. Item.ACGC.27 Minutes and Actions 27.1 Approval of Minutes of the meeting of 6 June 2016 The Committee received the minutes of the previous meeting (ref. 03a.ACGC.060916). The minutes were approved subject to the following amendment: Item AC.17 referred to corporation instead of cooperation. It should be amended to read Wales Audit Office thanked the finance team for their cooperation during the audit. 27.2 Action Log The Chair presented the action log (ref. 03b.ACGC.060916) to the Committee for consideration. The following updates were provided: Action 05.05.16/AC07: The Committee was advised that a meeting between TR and GS would be arranged as part of the Structured Assessment review and completed by the December 2016 Committee meeting. The action log to be amended accordingly. Action 02.06.16/AC19a: The Committee was advised that discussions were ongoing and being considered as part of the Scheme of Delegation. MW would provide further information by the next meeting. All other actions were complete. Date: 6 September 2016 Version: v1 Page: 2
27.3 Matters Arising CC raised two points. Firstly, regarding Sophie Howe, Future Generations Commissioner, attending a future Board Meeting; and secondly, concerning the need to clarify who the Champion for the Welsh Language should be. MW agreed to pursue both of them items Quentin Sandifer joined the meeting Item.ACGC.28 Committee Governance 28.1 Terms of reference The revised Terms of Reference for the Committee (ref 05a.ACGC.060916) was presented for noting. The purpose was to provide an update on the outcome of the Committee review and associated impact. It was noted that the Terms of Reference received Board approval in June 2016. The Board Secretary advised the Committee that further discussions would take place with SW, PB and the Assistant Director of People regarding staff side representation. The Committee noted the: - Change of name of the Audit Committee to the Audit and Corporate Governance Committee - Change to the membership and regular attendees and Terms of Reference - Terms of Reference and membership would be subject to a review at least once a year. It was noted that the document contained a large number of it s and it was necessary to ensure that apostrophes were used appropriately. The Chair advised the Committee that TR would remain a member of the Audit and Corporate Governance Committee until the Non-Executive Director Local Authority was appointed. 28.2 Committee Work Plan 2016/17 The Committee was presented with the proposed Work Plan for 2016/17 (ref 05b.ACGC.060916). The Board Secretary advised the Committee that the development of a work plan was standard practice and in future years it would be presented to the Committee before the end of the financial year. The following was highlighted to the Committee: Date: 6 September 2016 Version: v1 Page: 3
- Annual Review of Committee Effectiveness this would be covered in the following agenda item and the work plan would be updated before being submitted for Board approval. CC welcomed the structured approach of the work plan and thanked the Board Secretary for co-ordinating its production. The Committee agreed that the Committee work plan be submitted to the Board for approval, subject to the amendment specified. 28.3 Committee Self-Assessment The Committee received an oral update on the Self-Assessment for noting. The Board Secretary advised that self-assessment as a measure of effectiveness is recognised as good practice. A questionnaire, based on the template in the Audit Committee Handbook, is scheduled to be issued in mid October, with a requested turnaround time for completion of 2-3 weeks. The Chair thanked the Committee in advance for their cooperation in the completion of the questionnaire. The Board Secretary advised that an annual review system would be developed in order to assess committee effectiveness. 28.4 Review of Standing Orders and Scheme of Delegation Review The Committee received an oral update on the review of the Standing Orders and Scheme of Delegation for noting. The Board Secretary advised that the Scheme of Delegation was being reviewed in association with a number of colleagues to include a greater level of detail. It was intended to submit the review to Board in November for approval. An interim review of the Standing Orders was also underway to reflect the move of the corporate headquarters to Number 2 Capital Quarter. This would be presented to the Board for approval in September. Item.ACGC.29 Wales Audit Office 29.1 Financial Statements Memorandum Wales Audit Office presented the Financial Statements Memorandum (ref. 06a.ACGC.060916) to the Committee for consideration and highlighted the following: - The report summarised the more detailed matters arising from the ISA 260 review which was submitted to the Committee in June 2016. - Appendix 1 included the recommendations and an action plan for Committee review. Date: 6 September 2016 Version: v1 Page: 4
HG advised the Committee that the report s recommendations and action plan have been addressed in the Management Response to the report. The recommendations would be added to the External Audit Action Log. 29.2 External Audit Progress Report Wales Audit Office presented the External Audit Progress Report (ref. 06b.ACGC.060916) to the Committee for consideration and highlighted the following: - The Trust specific project (review of collaborative arrangements for managing local public health resources) was underway - Financial audit work has been completed and requested that Committee members complete the structured assessment. - Review of Savings and Investments would be reported to the December Committee meeting, with follow-up work on microbiology to be undertaken next year. - National Fraud Initiative was to recommence this month. - Awaiting a response from HG regarding the national study Public procurement programme. TR advised that there was no completion date specified for the Early Intervention and Public Behaviour Change report. GS advised that the team responsible would be publishing an output in 2017. The Board Secretary advised the Committee that she would seek further information regarding the Behaviour Change events and consider if it would be appropriate for the Committee to receive and review the contents of specific national reports. 29.3 NHS Consultant Contract Follow-up Wales Audit Office presented the NHS Consultant Contract: Follow-up of previous audit recommendations report (ref 06c.ACGC.060916) to the Committee for consideration. It was highlighted that some progress has been made in addressing the recommendations but further work needed to be undertaken. QS presented the management response for discussion and highlighted the following areas: - When compared to the previous reports undertaken in 2011 and 2013, there were 20 outstanding recommendations and one new recommendation Date: 6 September 2016 Version: v1 Page: 5
- As of 6 September 2016, Public Health Wales has 77 directly employed consultant medical staff, 49 consultant medical staff employed by other organisations (all have honorary contracts), and four medical staff that have contracts with universities. Three key issues have been identified in the responses which have been classified as vital to the success of meeting the recommendations: namely, the resourcing of the Medical Director s Office, additional specialist medical workforce human resources support, and the ongoing relationship with the Joint Medical and Dental Negotiating Committee. The Committee noted that the response did not address each recommendation individually but presented an action plan with six distinct phases and associated activities to be completed within a specified timeframe. The Committee enquired as to what steps are in place to define performance criteria. QS advised that robust arrangements were in place with more information being available for the 49 consultant medical staff employed by other NHS organisations when compared to the 77 directly employed medical staff. Further work is being undertaken with regards to the directly employed staff. The Committee enquired as to the apparent low attendance figures of nonmedical managers who managed medical staff at job planning workshops. QS advised that work needs to be undertaken to identify direct management responsibilities in order to target the correct personnel for training purposes. The Committee was advised that reference should have been made in the management response to the organisational business plan cycle with reference to consultants job planning meetings and agreement of outcomes. It was confirmed that there is an apparent misalignment regarding review dates due to conflict between dates specified in the consultant s contract and corporate planning cycles. In response to TR s enquiry as to how Public Health Wales would take this forward with regards to organisational development and performance issues, PB advised that further work would be undertaken to review and identify priority cases with QS and his team, as per the management response. CC raised a concern over an apparent view that work plans are counterproductive. QS advised that a survey of consultants had been undertaken, in line with BMA guidance, to document activities and any discrepancies relating to time estimations can be identified and resolved. Date: 6 September 2016 Version: v1 Page: 6
HG commented that the system of providing honorary contracts to those medical staff employed by other organisations was a recognised and effective way of ensuring the provision of the appropriate expertise and structured governance arrangements. The Chair commented that she was satisfied with the phased approach as described in the management response and enquired as to contingency plans in the event of any vulnerabilities regarding the identified resource allocation regarding the provision of specialist medical workforce human resources support. PB advised there were no contingency plans in place as yet. The Board Secretary advised that the timeframe, with regards to governance monitoring, should be determined by either the People and Organisational Development Committee (with regard to the remit for the people and human resources matters) or the Audit and Corporate Governance Committee. The Committee discussed the options and the Chair confirmed the Audit and Corporate Governance Committee would retain governance responsibility for providing assurance to the Board and would receive feedback from Phase 1 actions at the December meeting. LEAD: QS The Chair requested more detailed action points for later phases and suggested identification and development of appropriate milestones/ monitoring processes. The Committee discussed and agreed that the report could be published subject to reference to another organisation providing specialist human resources support being removed as this had not yet been agreed with them. Quentin Sandifer left the meeting 29.4 External Audit Action Log The Committee received the External Audit Action Log (ref. 06d.ACGC.060916) for consideration. Updates were provided on the following: Action 160 it was agreed to change the status bar from orange to red to reflect the revised implementation date. The Committee agreed to consider the impact of the office move to 2 Capital Quarter on the timeframe and possible link with information governance. Date: 6 September 2016 Version: v1 Page: 7
Actions 174 and 175 it was agreed to insert dates into the Agreed Implementation Date column to reflect the completion status bar. The Committee noted that the Board approval process recorded these actions as complete. Action plans 176 and 177 - it was agreed to revise the implementation dates following agreement at the meeting with the Wales Audit Office between GS, TR and MW. Item ACGC.30 Internal Audit The Committee received six reports: i. Internal Audit Progress Report (ref. 07a.ACGC.060916) ii. Workforce Planning Report (ref. 07b.ACGC.060916) iii. Integrated Medium Term Plan (IMTP) Report (ref. 07c.ACGC.060916) iv. Environmental Sustainability Report Audit Review (ref. 07d.ACGC.060916) v. Annual Quality Statement (ref. 07e.ACGC.060916) vi. Health and Care Standards Report (ref. 07f.ACGC.060916) The Committee agreed to focus on the following two reports: the overarching Progress Report and the Workforce Planning report, which received limited assurance. 30.1 Internal Audit Progress Report Internal Audit presented the Internal Audit Progress Report (ref 07a.ACGC.060916) to the Committee for consideration and highlighted the following: - The report included the outstanding 2015/16 Internal Audit work (Health and Care Standards, Workforce Planning, and IMTP) - Focus on the performance monitoring reporting would increase from the December Committee onwards. These were the agreed timescales by which the organisation should respond at the various stages of an internal audit review. 30.2 Workforce Planning Report Internal Audit presented the Workforce Planning Report (ref 07b.ACGC.060916) to the Committee for consideration and highlighted the following: - Review was undertaken during February and March 2016, with a draft report issued in April 2016. Date: 6 September 2016 Version: v1 Page: 8
- The report received a limited assurance rating with 11 recommendations (three high, six medium, and two low) - Where data analysis had been undertaken the data was generally not presented in a consistent format and there were errors within the results of the data analysis - Not all of the workforce plans linked to the Integrated Medium Term Plan (I MTP) key objectives. - Planned follow-up is scheduled for December 2016. The Committee discussed the role of the new People and Organisational Development Committee with regard to providing future assurance on workforce related matters. PB advised that action plans are being developed to address the three high priority recommendations and should be resolved by the end of September 2016. The Committee noted that following a request from Welsh Government, arrangements are in place to report a quarterly list of all limited or no assurance NHS Internal Audit Reports to the Chief Executive of NHS Wales, Dr Andrew Goodall. In line with other NHS bodies in Wales, the quarterly report would capture those reports already reported to the Audit and Corporate Governance Committee. The report for Q1 of 2016/17 had therefore been nil return and the Workforce Planning Report would be reported at the end Q1 (October 2016). The Committee noted that two reports, IMTP and Annual Quality Statement, received a substantial assurance rating. Item ACGC31 Internal Audit Action Log The Committee received the Internal Audit Action log (ref 08.ACGC.060916) for approval. The Committee noted that Actions 80 and 81 have been signed off by the Deputy Chief Executive and Executive Director of Operations and Finance, who advised that an interim business continuity plan was put into place during the move to 2 Capital Quarter. The Committee acknowledged that the business continuity review would be formally signed off within due course, and subsequently followed by an follow up audit, scheduled to take place later in the year. The Committee noted that Action 176 was only partially completed from an audit perspective, and further work on the consultants list was required (as had been referred to in the WAO Medical Workforce Report received earlier in the meeting). The action would not be marked as completed until there was assurance that it had been captured in the Management Response to the WAO review. Once this had been provided and there was a clear cross reference it could be marked as completed. Date: 6 September 2016 Version: v1 Page: 9
The Committee approved the Internal Audit Action Log, subject to the Action 176 amendments. Item ACGC32 Prevention of Fraud during the Recruitment Process The Committee received an update on the prevention of fraud process for information purposes (ref. 09.ACGC.060916). The Committee briefly discussed the content of the paper and were satisfied with the controls in place. Item ACGC 33 Board Assurance Framework The Board Assurance Framework (BAF) (ref. 10.ACGC.060916) was presented to the Committee for discussion, and the following was highlighted: - The Committee would receive the BAF in its entirety as it had an overarching governance role. - The Framework would be published on a monthly basis The Committee discussed a potential issue surrounding the publication date and its submission date to the Committee with regards to version validity and the need to receive the most up to date information. It was however noted that due to the requirement to publish papers 10 days in advance of the Board and committee meetings it was necessary to accept that there would always be the risk that actions had been taken to mitigate and update risks during this time. The Committee agreed to continue with the specified publication date and noted that any changes to the BAF after submission to the Committee would be highlighted at the meeting. It was agreed to review this arrangement at the June 2017 Committee. This would be added to the Committee work programme for 2017/18. Item ACGC34 Topical legal and regulatory issues The Board Secretary advised the Committee of a new standing item for the Committee: Topical Legal and Regulatory Issues. It was considered good governance practice to include this item on the agenda and, where appropriate information would be presented as a written report. The type of matter that would be reported under this section would include the current consultation on the Welsh Language Standards. Consultation responses were due by the 15 October 2016 and the Welsh Language Officer was coordinating the response. This would be shared with Non-Executive Director colleagues at an appropriate point. Date: 6 September 2016 Version: v1 Page: 10
It was also noted that an Internal Audit review was scheduled for Quarter 3 which would Welsh Language compliance. Item ACGC35 Items for noting The Committee noted eight items as follows: 1. Losses and Special Payments Report (ref. 12.1.ACGC.060916) 2. Procurement Report (ref. 12.2.ACGC.060916) 3. Declarations of Interest, Gifts, Hospitality and Sponsorship Report (ref. 12.3.ACGC.060916) 4. Reporting of Internal Audit Reports to Welsh Government (ref. 12.4.ACGC.060916) 5. Counter Fraud Progress Report (ref. 12.5.ACGC.060916) 6. Employment Services Payroll Services Audit (ref. 12.6.ACGC.060916) 7. Welsh Risk Pool Services Review (ref. 12.7.ACGC.060916) 8. Procurement Services - Accounts Payable Internal Audit Report (ref. 12.8.ACGC.060916) The Board Secretary advised that the Declaration of Interest, Gifts, Hospitality and Sponsorship Report should not be published as it contained information to spouses and partners which was not in accordance with data protection requirements. It was agreed that the report would not be published until it had been reviewed by the Board Secretary. It was noted by the Committee that the Procurement Services - Accounts Payable Internal Audit Report received limited assurance. ItemACGC36 Publication of Papers The Committee agreed that all papers could be published with immediate effect, subject to the observations made above. ItemACGC37 Any Other Items of Urgent Business There were no items of any other business. Date of the Next Meeting: 6 December 2016 Date: 6 September 2016 Version: v1 Page: 11