Agenda item

Report of the Executive Director of Resources

The Committee considered a report of the Executive Director of Resources, which provided a summary of the Council’s anti-fraud activity during the financial year 2016-17 to date.

Fraud in the public sector has had a national focus through the publication of ‘Fighting Fraud and Corruption Locally – The Local Government Counter Fraud and Corruption Strategy”.  Whilst the national strategy stated that the level of fraud in the public sector was significant, the current trends in fraud activity included areas which Coventry City Council did not have responsibility for and the levels of identified / reported fraud against the Council were at relatively low levels, in terms of both numbers and value.

The Internal Audit Service was responsible for leading on the Council’s response to the risk of fraud.  The work of the team had focussed on four main areas during 2016/17, namely Council Tax; National Fraud Initiative; Referrals and Investigations considered through the Council’s Fraud and Corruption Strategy; and Proactive work.  The report provided a summary of the work undertaken in each of these areas.

In relation to Council Tax, the main area of focus to date had been reviewing Council Tax exemptions.  This reflected the view of an inherent risk of fraud / error in this area as the Council was reliant on the customer to report any changes in circumstances.  As a result of the work, 101 exemptions were removed from customers’ accounts.  Revised bills were issued amounting to approximately £148,000 and £64,000 of this money had been repaid to the Council to date.  The Committee noted that the outstanding balances were being recovered through agreed payment instalment arrangements or were subject to the Council’s standard recovery arrangements.

The National Fraud Initiative exercise was led by the Cabinet Office and took place every two years, matching electronic data within and between public bodies with the aim of detecting fraud and error.  Work had been focussed on collating and submitting the datasets required for the next exercise.  It was anticipated that matches would be released for investigation in February 2017.

With regard to Referrals and Investigations, the Committee noted that 7 referrals had been made to date, 1coming from a Whistle blower and 6 from managers.  Of the7 referrals received, 5 led to full investigations.  There were various reasons for referrals not leading to an investigation.  In addition to the 5 investigations, a further 5 investigations had been carried forward from 2015/16.  4 of the 10 investigations were continuing and of the other 6 in 2 cases the officers had left their post during the disciplinary process; one received a final / written warning; and one the allegation was found to not be substantiated.  2 of the cases were linked to the award of Small Business Rates Relief where the customer had failed to report other businesses interests which affected their entitlement and, in both cases, revised bills were issued totalling £10,200.

The Committee noted that the Council’s response to fraud also included an element of proactive work.  Whilst this had been limited during the first half of the year, it had included a review of the Council’s fraud and corruption strategy linked to the publication of the updated national strategy.  This work was nearing completion and would be reported to the Committee at a future meeting.  Members requested that they be provided with a summary of the updated national strategy.  In addition, following a previous request by the Committee, arrangements had been made for an article on the rolling programme of Council Tax reviews to be published in the December edition of the Council’s Citivision magazine.

RESOLVED that the Audit and Procurement Committee note the anti-fraud activity undertaken during the first half of the financial year 2016/17.