The Financial Audit Manager presented the report which set out progress for the year, including an update on the financial and performance audit work both undertaken, and due to be undertaken, by Audit Wales, and to introduce a presentation to the Committee on the National Fraud Initiative.

The Audit Wales Representative outlined the financial audit work which covered the status of the topics listed in Appendix A of the report.

The Audit Wales Representative explained that further progress had been made with these and said that the final letter had just been issued this week to the council on the Recovery Planning topic. She added that a final report had also been issued on the Digital Council topic. She explained that a number of the topics were in early stages and had not yet commenced but many had begun and were in the scoping phase.

The Chairperson recognised that there were a number of pieces of work in the scoping phase, but there were no dates provided for the likely completion of these. She asked if these dates, or approximate dates, would be made available to Committee, as she was conscious of the possibility that BCBC staff could be inundated with all the work at once.

The Audit Wales Representative explained that they were looking at around the autumn time for completion of these pieces of work, but there was still a large amount of scoping to do, so she could not at this time, guarantee  specific time frames.

The Lay Member asked with regards to learning from the past year, initiating change and utilising any opportunities that were made available, what were the plans to collaborate and share information with Welsh Government in this. The Audit Wales Representative stated that the team that worked on this were meeting with the WLGA to discuss this going forward. She added that following from conversations with other Local Authorities, it had been recognised that there needed to be collaborative working and that was the general consensus of all conversations when discussing the future.

The Chairperson asked where reports were sent to within BCBC as there were a number of reports that were less specific and may be less obvious where they needed to go, ie a contact point. The Audit Wales Representative stated that there were a number of key contacts that were used and believed that these reports would be distributed to the senior officers of BCBC, but she would check on the specifics of this, and come back to Committee with the details.

The Audit Wales Representative gave a presentation on the National Fraud Initiative (NFI) which provided details on what the NFI was, including related elements of this. The presentation would be circulated to Members following the meeting.

A Member asked if there were any security risks with the NFI system.

The Audit Wales Representative explained that all data was dealt with in compliance with Data Protection laws and any time new data was being introduced, conversations were had with the Information Commissioner to ensure the data was being dealt with accordingly. Any time an action was required, NFI officers would provide sufficient evidence of fraud or the risk to commit fraud. He added that the information held was audited in accordance with the Welsh Governments national security standards.

A Member asked how identity fraud was found with regards to passports and drivers licences when the holder had passed away. The Audit Wales Representative explained that there were methods of matching details within NFI that helped prevent the misuse of this type of identification. An example was information that had been shared from the Metropolitan Police to assist in data matching.

A Member asked how much of the money identified in fraud was returned to the public purse.

The Audit Wales Representative explained that the amount was around 50% and this was due to a number of reasons, one of which was that many of the fraudsters already spend the money before they are caught and therefore did not have the means to repay.

A Member asked if NFI looked at patterns or trends with regards to detecting fraud. The Audit Wales representative stated that there was no profiling carried out, all fraud detections were dealt with on an individual basis.

A Member asked if there were any problems with NFI and/or detecting fraud that were worth noting. The Audit Wales Representative stated that there were sometimes matches that were not fraud or errors, but rather data quality issues or false positives. He added that when providing the information back to bodies, the information had to be carefully considered, as not all such information provided was fraudulent.

A Member asked if the NFI system could be used to benefit people who were entitled to more benefits and also to prevent people who were unintentionally over claiming to continue doing so, and prevent them needing to pay back a substantial amount of money in the future if it were to be detected as potential fraud.

The Audit Wales Representative explained that the system was not currently able to do that and the legislation also prevented NFI from doing it. It was something worth noting and looking into for the future if that were to change.

RESOLVED:                                     That the Committee noted the Audit Wales Governance and Audit Committee Reports at Appendix A and Appendix B to the report, and the letter from Audit Wales at Appendix C, as well as the presentation on the National Fraud Initiative.