Update on Audit Commission police use of resources evaluation

Report: 6
Date: 10 December 2009
By: Treasurer and the Director of Resources on behalf of the Commissioner

Summary

This report provides Members with a summary of the key issues raised by the Audit Commission the Police Use of Resources Report for the MPA attached. This follows an assessment of how the MPA and MPS is managing and using resources to deliver value for money and better and sustainable outcomes for local people. Appendix 1 of the Audit Commission report also sets out the MPA and MPS response to the issues raised in the form of an action plan.

A. Recommendation

That that members:

1. note the action being taken in response to the Police Use of Resources Evaluation 2008/09; and
2. a progress report on the implementation of recommendations be presented to the next meeting of the Committee.

B. Supporting information

1. Between April and August this year, the Audit Commission undertook planned inspection work looking at how the MPA and MPS manage and use resources. The Audit Commission conducts an annual Police Use of Resources Evaluation ( PURE) for every Police Authority in England.

2. The themes, criteria and thresholds of performance in the PURE assessment were changed for 2008/09, which the Audit Commission clearly communicated as a harder test for Police Authorities and Forces. The increased expectation on Authorities in PURE is reflected in the national scores for 2008/09. In 2007/08, only two Authorities were awarded a score of Level Two (the MPA/MPS and Cambridgeshire) and this has risen to 17. The 12 Authorities awarded Level Four ‘excellent’ scores in 2007/08 have all received a lower score in 2008/09

3. The new assessment themes are:

• Managing Finances
• Governing the Business
• Managing Resources

4. While the ‘Managing Finances’ and ‘Governing the Business’ themes consist of many areas previously assessed in PURE, the ‘Managing Resources’ theme is new. The theme assesses assets, workforce and natural resources. The Audit Commission assesses only one of these sub themes each year. The 2008/09 assessment for Police Authorities focused on workforce. In 2009/10, the assessment will focus on the MPA and MPS use of natural resources.

5. The scope of the PURE assessment has also broadened to include detailed assessment of ‘use of information,’ (focusing on data quality), covered in the ‘governing the business’ theme.

6. The MPA and MPS worked together to develop a comprehensive self-assessment for the Audit Commission. The self-assessments provided evidence on the corporate approach for each set of criteria along with operational examples provided by business groups.

7. Whilst on site, the inspection team sought to test the evidence that the MPA and MPS had provided. They interviewed a range of staff, including senior MPA officers and Members and reviewed further evidence provided over the duration of the assessment. The Audit Commission also brought performance specialists onsite to assess Procurement and Risk Management.

8. The Audit Commission has now issued the attached final report for 2008/09. The MPA/MPS performance scores under the new 2008/09 framework are shown in paragraph 10. The MPA and MPS have contributed to the report by completing an action plan for the recommendations made. This is shown in Appendix 1 of the final report.

Summary of findings

9. The main findings of the Audit Commission’s PURE work are:

• The MPA/MPS have been assessed as achieving adequate performance (Level Two) overall for 2008/09. The previous score has been maintained; however, the bar for performance at each level was lifted again this year so overall it can be considered that the MPA and MPS have performed better. The themes, scope and criteria for PURE have changed this year, it is also, therefore, difficult to compare with performance in previous years.
• The Audit Commission has noted that the direction of travel for the MPA and MPS continues to be positive and substantial progress has been made to modernise corporate processes.
• The MPA and MPS were assessed as delivering good outcomes in financial management, achieving Level Three ‘performing well’ score, demonstrating a sound financial performance in 2008/09. The MPA and MPS also achieved a Level Three score in the workforce sub-theme of ‘Managing Resources,’ exhibiting many strengths in aspects of workforce management, including sickness absence management and the promotion of diversity. As a new area of assessment in PURE, this is a significant achievement for the MPA and MPS.
• The Audit Commission also noted progress in terms of achieving efficiencies, financial reporting, procurement and governance arrangements.
• The MPA/MPS arrangements for financial reporting have been rated as Level Two. In 2007/08 the score in this area was Level Three. It should be noted however that the criteria scope and performance threshold in this key line of enquiry has widened and increased under the new PURE assessment.

10. The theme scores are outlined in the table below. The scores for the key lines of enquiry (KLOE) assessed within each theme are also shown, demonstrating the comprehensive scope of the new PURE framework. These scores have been confirmed by the Audit Commission's national quality control process which seeks to ensure consistency across all auditors.

Table: MPA/MPS Summary of use of resources by theme and KLOE

11. The Audit Commission has made 23 recommendations, in comparison to 27 made in the 2007/08 report. These are set out in full in the Action Plan at Appendix 1. The areas covered by the recommendations include:

• Improving the quality of police crime data
• Understanding the organisation's cost base, which continues to be high
• Strengthening internal control through improved compliance with internal procedures and regulations
• Improving the clarity in corporate risk management arrangements, particularly for MPA members.

12. The following actions have been set out for the Police Authority in ensuring continued focus on the effective use of resources:

• Review the level of reserves regularly
• Maintain effective control of the treasury management functions and monitor compliance with the Treasury Management Strategy Review the Crime Data Recording Scrutiny Report to monitor and challenge progress in implementation and impact of outcomes Monitor the implementation of audit recommendations.

MPA/MPS response to the 2008/09 PURE report

13. Both the MPA and MPS welcome the recognition given by the Audit Commission to the progress made by the organisation during 2008/09 and the continued positive direction of travel outlined. It is also reassuring that the recommendations so closely reflect the work that is already underway to ensure the most efficient, effective and economic use of all resources entrusted to the MPA and MPS to support policing in London.

14. Met Forward the MPA mission statement for London’s police has eight strands aimed at ensuring delivery in critical areas. It sets out how the MPA wants the MPS to develop and perform to improve confidence, provide better value for money and fight crime. Three key strands for the effective use of resources include; Met Support which is working to drive out waste, improve value for money and concentrate resources on fighting crime; Met partners promoting effective and joined up partnership working and Met people recognising people as the most important asset of the MPA and MPS. The Authority’s committee structure and work plans have been developed to support the delivery of Met Forward. The work of the Resource and Productivity Sub committee, in particular, has increased oversight on the effective use of resources and productivity and this work will continue to develop throughout 2009/10 supported by a dedicated resource within the Authority.

15. A number of programmes of work already underway within the MPS will contribute to disseminating and embedding good practice highlighted in the PURE report. They will also support the organisation in addressing the areas for improvement and in preparing for next year’s assessment, which is due to commence in January 2010. These programmes include:

• The Service Improvement Plan, which focuses on the high cost areas as identified in national benchmarking exercises (the Estate and transport for example)
• Development of the new Performance Management Framework, part of the Productivity agenda. This will benchmark MPS costs nationally and will also further align financial and performance information
• The Developing Resource Management Programme, which over 2009/10 has significantly increased the MPS levels of purchasing compliance, control of financial approval and visibility of spend to contract
• The Data Quality Programme, providing a thorough analysis of the data requirements of the organisation

16. The MPS and MPA will need to work together to ensure the positive direction of travel is maintained. It is therefore proposed that progress on responding to the PURE recommendations is reported to the next meeting of this Committee. This report will also provide an update on the 2009/10 PURE assessment, which is due to commence in January 2010.

C. Race and equality impact

None of the recommendations made in the 2008/09 PURE report relate to race or diversity issues. The MPA and MPS has been recognised as performing well in promoting diversity.

D. Environmental and sustainable development implications

Use of natural resources was not assessed in 2008/09. This will be assessed in the 2009/10 PURE process. As the ‘dominant’ sub theme within the Managing Resources theme, the MPA/MPS must score a Level Three score for its use of natural resources in order to maintain it’s overall Level Three score in the this area of the assessment in 2008/09 (for the workforce sub theme)

E. Financial implications

The work streams identified in the Action Plan will be delivered within approved budgets.

F. Legal implications

1. The duties and powers of external auditors appointed by the Audit Commission are set out in the Audit Commission Act 1998, the Local Government Act 1999 and the Commissioners Statutory Code of Practice

2. External audit is an essential element in the process of accountability for public money and makes an important contribution to the stewardship of public resources and the corporate governance of public services.

3. This Committee has delegated authority to review the external auditor’s Annual Governance Report and to report to the Authority as appropriate.

G. Background papers

None

H. Contact details

Report author: Kate Higham

For information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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