Internal audit salary review

Report: 7
Date: 25 June 2001
By: Treasurer

Summary

A review of Internal Audit salaries has been initiated. An oral update will be provided to the meeting.

A. Recommendation

That the report be noted.

B. Supporting information

Introduction

1. Internal Audit was the only group of staff who, at 3 July 2000, transferred from the direction and control of the Commissioner to working directly for the MPA reporting via the Treasurer. Their previous terms and conditions and pay levels were protected under the transfer arrangements.

Salary reviews

2. The MPA commissioned a review of salary arrangements to apply to the new posts created to support the Authority. This review was carried out by Hay and reported in December 2000. Internal Audit were not included in this exercise.

3. The salary structure of civil staff under the control and direction of the Commissioner is the subject of a separate review also being carried out by Hay. Again, since they have transferred to the MPA, Internal Audit are not covered by this review.

4. A specific review of MPS Finance Department salaries has been undertaken by Cornwell Affiliates on behalf of the Director of Resources.

Requirements in relation to Internal Audit

5. Information has been provided to the Panel previously about the persistent level of vacancies in Internal Audit and the difficulties in recruiting and retaining staff of the appropriate quality. This is in spite of the use of market related allowances under the MPS's personnel policies. As a result Internal Audit has regularly failed to achieve its planned programme of system reviews thereby undermining the Authority's ability to meet its statutory responsibilities in relation to the integrity of the financial management of the Metropolitan Police.

6. Salary levels in Internal Audit therefore need to be addressed to ensure that the section can deliver its responsibilities on behalf of the Authority. I have also given a commitment to the staff that their position will be reviewed alongside all the other civil staff employed by the MPA.

Action taken

7. Accordingly I have negotiated a short extension of Cornwell Affiliates' contract with the MPS for them to provide me with advice on the appropriate salaries for Internal Audit. Their remit is to advise on current market levels for internal audit staff and to make recommendations having regard to Hay's work on behalf of the MPA and their own conclusions in relation to the MPS Finance Department.

8. I have discussed draft findings with the consultants and, at the time of writing this report, am awaiting their final report. I hope to be in a position to give an oral update at the Panel's meeting.

Next steps

9. A revised salary structure for Internal Audit should be approved by the Human Resources Committee. The next available meeting of that Committee is on the afternoon of 6 September. The next meeting of the Audit Panel is in the morning of 6 September. I therefore envisage putting the same report to the two meetings so that the Audit Panel's views can be presented to the Human Resources Committee. However I would expect to share the proposals with Audit Panel members and take their views before writing the committee report.

10. During July I will consult staff on the consultants' conclusions.

C. Financial implications

The cost of the consultants' review of Internal Audit salaries will be £x which will be met from the provision for consultants in the MPA support organisation budget. The cost of implementing revised salaries should be met from the overall provision in the 2001/02 budget for addressing the recruitment and retention of civil staff.

D. Background papers

None.

E. Contact details

The author of this report is Peter Martin.

For information contact:

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

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