MPS Corporate Governance Framework Update

Report: 15
Date: 7 July 2011
By: Director of Resources on behalf of the Commissioner

Summary

This report provides a progress update on work areas pertaining to the Metropolitan Police Service (MPS) corporate governance framework.

A. Recommendation

That members note the progress being made across a number of corporate governance work areas as set out in this report.

B. Supporting information

Current corporate governance arrangements

1. The MPS continues its drive to achieve excellence in corporate governance. It uses an established ‘temple’ model of corporate governance, approved by Management Board (see Appendix 1) that reflects current good practice.

2. The MPS corporate governance work programme consists of a number of work streams that have been identified through a gap analysis against elements of the CIPFA/SOLACE framework: “Delivering Good Governance in Local Government” the Interim Guidance Note for Police Authorities & Forces in England and Wales (2007) and significant governance issues included in the 2009/10 MPS Annual Assurance Statement. A full list of work streams and the responsible leads is included in Appendix 2. This work programme is managed and monitored through the MPS Governance Board, with regular progress updates to this Committee.

3. This is the fourth quarterly report identifying improvement against the 2009/10 Annual Assurance Statement.

Summary of progress

4. For each work stream, a progress update for the quarter is detailed below.

Pillar One: Organisational structures & processes

5. Embedding risk management

• The corporate risk escalation process has been formalised with the introduction of a standing agenda item at MPS Governance Board under which risks can be raised by business groups for possible acceptance to the corporate risk register. The process is designed to improve the links between business group and corporate risks and facilitate cross cutting discussion whilst ensuring that paperwork is kept to a minimum.
• Work continues to improve the quality of information contained within the corporate risk register and the mechanisms by which this updated. This quarter work has focused on the partnership risk area and some analysis of the people risk area in partnership with the HR Directors Team.

6. Implementation of Developing Resource Management Programme

1. Corporate Real Estate
   The work-stream continues to progress well, focussing on the disposal list approved in-principle by the MPA in December 2010, and has achieved its savings target for 2010/11.
   • Accommodation moves continue to plan, with particular focus on finalising the vacation of Westminster HQ (Canon Row) and the sale of former stations (including Harold Hill, Rainham and Leytonstone), as agreed at the Finance and Resources Committee in April 2011.
   • Major works are underway at receiving sites, including Empress State Building (ESB).
   • Collaborative work continues across the MPS, including communications to business groups through Change Leaders and the implementation of the communications plan, including an article in the April 2011 edition of The Job magazine.
   • Engagement with other MPS corporate change programmes also continues including with the Developing Training programme (Regional Learning Centres) and the Public Access work-stream of the TP Development programme.
2. Delivery of Property Services
   The savings for 2010/11 have been delivered through reviews of corporate contracts, including security guarding, cleaning and facilities management.
   • Further savings opportunities are being developed with suppliers
   • Transition to energy management Buying Solutions was completed on time in April 2011 and the transition action plan was also implemented.
   • PFI contract savings proposals will be finalised and negotiated with suppliers by June 2011.
3. Procurement
   The implementation of technical / system improvements commenced in March 2011 and will improve and streamline systems, enhance management reporting and the user experience. A full communications strategy, plan and supporting material have been developed for roll-out during April and May 2011.
   • Continued support and capability enhancement has been conducted across the business via Procurement Awareness Training, the Contract Management Toolkit and focused contract management training.
   • The e-sourcing portal Compete4 has been implemented following extensive preparatory work with users and suppliers
   • The No Purchase Order (PO) No Pay policy was agreed by Management Board on 2 March 2011.
4. Source-to-Payment
   • Over 6 months the Source 2 Payment work-stream will provide e-sourcing and contract management systems as the first phase of the e-procurement strategy
   • Work started with all suppliers in April 2011 in preparation for the full Source 2 Payment work-stream launch in May 2011.
   • Intensive delivery work, including communications and engagement activity, is underway in advance of the new integrated Source 2 Payment systems go-live in October 2011
5. SAP Development
   • Capital Management
     • The new capital budget management functionality is in full use with reports providing full visibility of capital spend
     • The functionality transitioned to full support in May 2011, with ongoing maintenance and improvement overseen by a new Capital Management User Group
   • Invoice Management
     • A raft of technical fixes and enhancements to functionality have gone live since December 2010. Work with users has enabled the new functionality to be fully applied, maximising invoices scanned and managed on-system.
     • The project will transition into support in June 2011
   • Capability Review
     • The roadmap for long-term use of resource management tools was presented in April 2011 and will be overseen by the Corporate Services Steering Group (comprising system users) with the first suite of enhancements to financial management in SAP delivered during March-April, rolled out though year-end process.
     • Planning and initial implementation of more significant improvements is ongoing and is planned to complete by March 2012
   • Asset Tracking
     • Intensive development, change management and communications of asset tracking solution for uniforms and criminal exhibits are underway. An asset management roadmap for future development has been produced.
   • Vehicle Recovery and Examination Service
     • A feasibility study has commenced to explore the replacement of current systems with a solution integrated into MPS resource management systems
6. Finance and Resources Modernisation 2
   • The proposal for the integration of critical support services was agreed by Management Board in May 2011, in advance of a three-month consultation with all stakeholders, including all users, suppliers, trade unions and staff associations.

7. Partnerships
During the last quarter the Partnership Programme Team has continued to work with key internal and external stakeholders to drive forward the Programme, overseen by the Partnerships Central Steering Group (PCSG).

• DARA audit recommendations have been incorporated into the Partnership Work Plan.
• The first draft of the Partnership Management Approach has been completed, which will lead to the development of a Partnership Agreement template
• The Partnership Guidance has been fully revised and re-launched
• Guidance and support has been provided to partnership practitioners, including:
  • Input into the Borough Commander Development Programme
  • Communications to Borough Commanders regarding funding changes and the guidance and support available
  • Regular best Practice Network communications
• A review of the corporate partnership risk has informed the development of the Partnership Programme to ensure it delivers controls to effectively manage identified risks.
• An initial assessment of the risks associated with changes in funding has been undertaken for TP.

8. Provision of detailed information on emerging market hotspots, especially around specialisms and specialist professionals
In light of the impact of early departure schemes across the organisation, traditional market pressures around recruitment of key personnel are not currently viewed as a live issue, although the effect of a 2-year pay freeze on staff retention is being monitored.

The risk assessment of Olympic-related hotspots continues with a small number of police officer posts identified. The risk of attrition is judged to be diminishing as

• There has been limited wastage of key post-holders to date and vacant posts have already been filled
• With only one year away from the Olympic Games most alternative employers would have already recruited to ensure staff have an appropriate lead in time to be fully effective in a new role

9. Review of expenses policy
Issues identified through the consultation process, including payment of the congestion charge, ATOC arrangements and repayment for use of personal mobile phones, have been captured and will be addressed through future issues of the policy.

10. Organisational Learning
Significant progress has been made to embed a corporate approach to organisational learning (OL).

• The scope for the search for learning and sharing opportunities has been widen, and includes national forums such as The Police OnLine Knowledge Area (POLKA)
• Minimum standards of governance include the identification of dedicated business group OL leads working with identified SPOC’s at OCU level, a standard tracker to ensure corporate memory and accountability for sharing learning and escalating issues according to business risk.
• Work to provide the necessary IT capability is progressing and will build on the processes now embedding across the MPS.
• A toolkit of learning options has been developed to allow for lessons to be shared according to necessity and value.
• Specific learning projects include broader Organisational learning for Olympic Legacy.
• The impact of the inclusion of pro-active OL in the MPS Performance Framework will be evaluated through specific questions in the next staff survey.

11. Compliance Framework

• Compliance controls continue to be strengthened through the DRM programme Procurement and SAP work-streams. Further information on this work can be found at paragraph 6.
• The Compliance and Assurance Team (CAAT) have categorised audit recommendations from DARA and other audit and inspection bodies to identify areas for potential future inspection activity and maximise compliance.

12. Review of MPS Environment Strategy and development of Corporate Social Responsibility / Sustainable Development Strategy for 2010-13

• The Environmental Management Plan (EMP) has been extended to include Responsible Procurement. The plan is now called the Sustainability Management Plan (SMP) and was presented at the April Environment and Sustainability Board (ESB) meeting; previously know as the Environment and Sustainability Steering Group (ESSG).
• The ESB meeting terms of reference have also been updated to reflect the inclusion of Responsible Procurement in the SMP.
• The development of the annual targets for the EMP 2011/12 have been completed
• A pilot of the awareness campaign at Becke Fielding house in the Peel Centre and Paddington Green was completed at the end of Q4. The results have been analysed and were presented at the April ESB meeting. The campaign will be rolled out across directorates from May, with particular focus on high energy consuming sites.
• There are now more than 80 environment champions across the organisation.
• The MPS Chaired the National Police Environment Advisory Group (NPEAG) hosted by the Home Office in January.

13. Corporate Change (including the Service Improvement Plan (SIP))
The change co-ordination process continues to be developed within the Strategy and Improvement Department. As part of this approach a virtual team has been established led by the Director of Business Performance to assess the performance of major change programmes, track savings, analyse HR implications and ensure key risks and dependencies are being managed.

14. Business Charge Card
The contract with Barclaycard to supply the travel and subsistence card was renewed in March 2011 following a competitive tendering process. The new contract continues the tighter criteria introduced in 2008 for the card holders to account for their expenditure. The procedures have been revised in response to a DARA audit published in December 2010 and also good practice developed across the business. See Appendix 3 for the value and volume of un-reconciled expenditure returns as at 11 April 2011.

Pillar Two: Reporting to & involving the MPA & stakeholders

15. Review of all forms of public engagement and consultation
The draft MPS action plan for the Community Engagement Commitment has been considered by the MPS Confidence and Satisfaction Board and was presented to the MPA Communities Engagement & People Committee in May 2011.

16. Safer Neighbourhoods panel training and business/youth engagement

1. Business Engagement
   • The first meeting of the Town Centre Team (TCT) leads was held in March 2011 to promote good practice, identify issues and listen to presentations on engagement and intelligence gathering. A further meeting will be held later this year.
   • The TCT web page has now gone live and has links to good practice and relevant documents and templates.
2. Youth Survey
   • The Safer Neighbourhoods unit has created a working group to deliver the 2011 youth survey, which will target 11-18 year olds in secondary education and will launch in September 2011.
3. Town Centre Programme
   • The Town Centre Programme (TCP) board is overseeing a development and review process of the TCP, which will include how the system is monitored, how teams are supported and how performance monitoring can be improved.
   • Work has been undertaken to revitalise Borough awareness of the importance of providing monthly returns
4. Youth Strategy and Engagement
   • A significant project is being undertaken to identify and map all youth engagement and diversion activity across the MPS.

Pillar Three: Standards of behaviour

17. Enhanced MPA/MPS Fraud and Corruption Awareness Strategy

• 10 Fraud Awareness Workshops have been delivered to approximately 350 officers and staff across most of the MPS, primarily targeted at (B)OCU Commanders, Finance Managers, Resource Managers, Exchequer Services and Procurement staff
• The initial meeting of the joint MPA/MPS Fraud Forum was held this quarter.

18. Introducing the Equality Standard

• The Diversity & Citizen Focus Advisor (DCFA) teams are supporting the Boroughs and Business groups in their improvement activity and tracking their progress.
• The Diversity & Citizen Focus Directorate (DCFD) is producing good practice / improvement guidance on critical issues resulting from the Equality Standard for the Police Service (ESPS) baseline assessment.
• The ESPS has been aligned to MPS Policy and SOPs and to the current MPS strategic objectives.
• DCFD has set up a feedback session to ensure that user feedback is captured and informs the next phase of implementation.

C. Other organisational and community implications

Equality and Diversity Impact

1. The model of corporate governance set out in this report is based on the principles of openness; integrity; accountability and equality. The development of the framework therefore should have a positive race and diversity impact by ensuring that these principles inform the way in which MPS operates. Furthermore, improved communication of the corporate governance framework aims to help staff understand how to apply these principles in their day-to-day work.

Consideration of MET Forward

2. This report provides assurance that the MPS is improving the governance infrastructure of the MPS to ensure better value for money when fighting crime.

Financial Implications

3. All costs associated with the work streams identified in this report will be met from existing MPS budgets as approved in the 2011-14 Business Plan.

Legal Implications

4. The MPA are under a statutory duty to prepare and publish an Annual Governance Statement (AGS), under regulation 4 (2) of the Accounts & Audit Regulations 2003, as amended by the Accounts & Audit (Amendment) (England) Regulations 2006. The AGS is a general certification about governance issues, which is the primary responsibility of the MPA as police authority.

5. In order that the MPA can discharge its statutory duty referred to in paragraph 1 above, the MPS provides its certification to the MPA by submitting an Annual Assurance Statement (AAS), as recommended by CIPFA / SOLACE guidance “Delivering Good Governance in Local Government-Interim Guidance Note for Police Authorities and Forces in England and Wales (2007”) (“The Guidance”), which demonstrates how aspects of governance have been implemented within the police force.

6. The Corporate Governance Framework provides the supporting information which evidences that the MPS will ensure it has robust systems in place that demonstrate it is adhering to the strategic direction set by the MPA, and is delivering good governance through the delivery of many operational and financial aspects within a delegated framework, in accordance with Guidance and best practice.

7. Compliance with the Corporate Framework will also assist in raising standards, reduce risk of legal challenge and build public confidence by ensuring the MPS operates in a transparent manner.

Environmental Implications

8. The work streams identified have varying levels of environmental impact / benefits.

Risk Implications

9. The work streams in this report are key activity areas in risk area 1 of the corporate risk register “need to manage corporate governance effectively”. Improvement in these work areas continues to reduce the risk of a significant governance failure.

D. Background papers

None

E. Contact details

Report author: Nicky Harris, Strategy and Improvement Department

For information contact:

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

Glossary of Terms

CEC

Community Engagement Commitment

CEP

Communities, Equalities and People Committee

CIPFA

Chartered Institute of Public Finance and Accounting

CRE

Corporate Real Estate

CSR

Corporate Social Responsibility

DCFD

MPS Diversity and Citizen Focus Directorate

DRM

Developing Resource Management

ESB

Environment and Sustainability Board

ESPS

Equality Standard for the Police Service

ESSG

Environment and Sustainability Steering Group

HRA

Human Rights Act

OL

Organisational Learning

PCSG

Partnership Central Steering Group

PFI

Private Finance Initiative

PWC

PriceWaterhouseCoopers

NIM

National Intelligence Model

MPIC

Met Property Information Centre

NPEAG

National Police Environment Advisory Group

SIP

Service Improvement Plan

SMP

Sustainability Management Plan

SN

Safer Neighborhood

SOLACE

Society of Local Authority Chief Executives

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