1. Scope
   1. The London Borough of Bexley is responsible for ensuring that it serves its communities, residents and businesses in accordance with the law and proper standards, and that it safeguards and accounts for the public money, assets and resources that it holds on their behalf.
   2. The Council has a duty under the Local Government Act 1999 to make arrangements to secure continuous improvement in the way in which its functions are exercised, having regard to a combination of economy, efficiency and effectiveness.
   3. The Council has approved and adopted a Constitution and Code of corporate governance, which is consistent with the principles of the CIPFA/SOLACE Framework Delivering Good Governance in Local Government.
   4. This Annual Governance Statement explains how the Council has implemented the Code and how the Council meets the requirements of the Accounts and Audit (England) Regulations 2015. The Council maintains a separate Governance Compliance Statement on pension fund matters to comply with the Local Government Pension Scheme Regulations 2013 and this forms part of the Pension Fund’s annual report (available at Local Pensions Partnership).
2. Purpose
   1. The Council’s governance framework includes the following elements:
      • The Council’s refreshed Corporate Plan #Making Bexley Even Better – Our Plan 2022-26, was launched in November 2022.
      • The Values adopted by the Council.
      • The Constitution and Code of Governance including Procedure Rules, Code of Conduct for Members and protocols.
      • The Officer arrangements for governance through the Corporate Leadership Team, Directorate Leadership Teams and Governance Boards; and
      • The systems and processes adopted by the Council
   2. These elements enable the Council to identify progress and monitor the achievement of its strategic priorities and outcomes. Together, they create a framework for the Council’s decision-making and management of performance, resources and risk.
      • The governance framework described has been in place at the London Borough of Bexley for the year ended 31 March 2023 and up to the date of approval of the Statement of Accounts. The Corporate Plan #Brilliant Bexley shaping Our Future Together formed part of the framework until refreshed, as noted above.
3. Governance Arrangements
   1. The following paragraphs explain the role and purpose of each group or individual within the Council's internal governance arrangements.
   2. The Council - The Council consists of all elected Councillors. Members are responsible for agreeing the overarching policy framework for the Council, for agreeing the budget, and assessing, critiquing, and approving the policy framework and strategies put forward to them by the Executive. The Council acts in accordance with the provisions contained in legislation and the provisions within the Council’s Constitution and Code of Corporate Governance, including those stipulated in Article 4 of Part 2.
   3. The Council have full access to the three statutory Officers responsible for governance, namely: Head of Paid Service, Section 151 Officer and the Monitoring Officer.
   4. The Council are supported by the Overview and Scrutiny Committees and General Purposes & Audit Committee who have responsibility for governance.
   5. The Leader and Cabinet - The Leader and Cabinet exercise the executive functions of the Council, in accordance with the provisions of Part 1A of the Local Government Act 2000, The Local Authorities (Functions and Responsibilities) (England) Regulations 2000 and the Council’s Constitution and Code of Corporate Governance. The Cabinet is at the heart of the day-to-day decision-making process and is responsible for proposing the policy framework and strategic direction of the Council. It also has a key role in proposing the budget and policy framework to the Council. It introduces both the traditional collective decision-taking and the possibilities for decision-making by individual Cabinet Members in respect of executive functions.
   6. The responsibilities within each Cabinet Portfolio and the Executive Arrangements are reported at the Annual Council meeting. The Cabinet will carry out all the local authority’s functions, which are not the responsibility of any other part of the Council, whether by law or under the constitution.
   7. The Cabinet are supported by the three statutory Officers and the wider Corporate Leadership Team.
   8. Overview and Scrutiny Committees - The role, functions and terms of references of the Council’s Overview and Scrutiny Committees are stipulated in the provisions of legislation and in Article 7 of Part 2 of the Council’s Constitution and Code of Corporate Governance. These include reviewing and scrutinising decisions made or actions taken in connection with the discharge of any of the Council’s functions, making reports and/or recommendations to the Cabinet and/or Council in connection with the discharge of any functions; and consider any matter affecting the economic, environmental, or social wellbeing of the area or its residents.
   9. The Overview and Scrutiny Committees can also exercise the right to call-in, for reconsideration, decisions made but not yet implemented by the Cabinet, Cabinet Members or key decisions if made by Officers; and consider matters referred as a Councillor Call for Action. Overview and Scrutiny Committees may assist the Council and the Cabinet in the development of the budget and policy framework by in-depth analysis of policy issues; review performance; and question and challenge Members of the Cabinet and appropriate officers/partner agencies about proposals affecting the area. They may also review policy and challenge whether the Cabinet has made the right decisions about these policies and their implementation; and may take a long-term view of strategic issues and look in detail at key aspects of the Council's operations.
   10. A number of the Overview and Scrutiny Committee Members form the Joint Budget Overview and Scrutiny Committee, specifically to consider the budget proposals and the Medium Term Financial Strategy.
   11. The Overview and Scrutiny Committees are composed of non-Executive Members of the Council and the Members of each Overview and Scrutiny Committee are allocated proportionately to reflect the balance between the respective Political Groups represented on the Council, in accordance with the provisions of the Local Government and Housing Act 1989. The Overview and Scrutiny Committees also operate under the relevant statutory guidance issued by the Government.
   12. Every year at the Annual Council meeting a Review of the Committee structure, size and membership takes place with the appointments made accordingly. Orders of reference for the Overview and Scrutiny Committees and policy areas within the remit and focus of each Overview and Scrutiny Committee can be revised. The latest version was agreed at the May 2018 Annual Council meeting where the current configuration of four standing Overview and Scrutiny Committees was introduced.
   13. Regulatory Committees - Regulatory Committees such as the Planning Committee and Licensing Committee take decisions that are legally outside of the remit of the Cabinet. These include the Pensions Committee, Planning committee, Appeals Committee and General Purposes & Audit Committee. The role of the General Purposes and  Audit Committee is to provide a source of effective assurance on the adequacy  of the risk management framework and the internal control environment.
   14. The Council’s Chief Internal Auditor, External Auditors and Section 151 Officer have direct access, if necessary, to the Chairman of the General Purposes & Audit Committee.
   15. External Audit - The Council is subject to review and appraisal from its external auditors, currently Ernst and Young Global LLP (EY). This organisation sends a report to the General Purposes & Audit Committee providing their opinion on whether the Council’s and the Pension Fund’s financial statements give a true and fair view of the financial position and the Council’s value for money.
   16. Ernst and Young Global LLP have been the Council’s external auditors since 2018/19 and their contract runs until 2024. This arrangement is through the Public Sector Audit Appointments (PSAA) process.
   17. Ernst and Young Global LLP have direct access to the Section 151 Officer and the Chairman of the General Purposes & Audit Committee.
   18. Internal Audit - Internal Audit is an independent assurance function that measures, evaluates and reports on the effectiveness of the controls in place to manage risk and governance processes. Their annual report states whether the systems of control are consistent and of adequate strength to allow the organisation to meet its objectives.
   19. Details of the annual internal audit plan and works undertaken are reported to General Purposes & Audit Committee and the work undertaken by the internal audit and assurance function supports the Council’s objectives, informs decision-making and assists the Cabinet and Corporate Leadership Team in making informed and effective decisions.
   20. A Debt Management Board has been established during 2022/23, chaired by the Deputy Section 151 Officer. This Board demonstrates the Council’s commitment to managing debt owed and identifying effective practices to ensure that bad debt is managed.
   21. The Corporate Leadership Team is the employed senior managerial function of the Council, headed by the Chief Executive as the Head of Paid Service. The Corporate Leadership Team is supported by the statutory Monitoring Officer, the Section 151 Officer (Director of Finance and Corporate Services) and the Directors of Adults Social Care and Health, Children’s Services and Place and senior Council Officers.
4. Compliance with and understanding of the CIPFA Solace Framework
   1. The Council has approved and adopted a Constitution and Code of Corporate Governance which are consistent with the principles of the CIPFA/SOLACE Framework Delivering Good Governance in Local Government. The overall aim of the CIPFA/SOLACE Framework is to ensure that:
      • resources are directed in accordance with agreed policy and according to priorities
      • there is sound and inclusive decision making and
      • there is clear accountability for the use of resources to achieve desired outcomes for service users and communities
   2. The principles that underpin these aims are laid out below:
      
      Behaving with Integrity, Commitment to Ethical Values and Respect for the Rule of The Law
   3. At Bexley, Codes of Conduct embed a strong public service ethos and high standards of behaviour for Members and Officers. This is stewarded by the organisation’s Chief Officers, Directors and Deputy Directors who are supported by Legal Services in their overarching responsibility to ensure legal/regulatory compliance and maintain sound, effective internal procedures/policies. These high standards of openness, transparency and accountability are upheld and fostered by the Council’s commitment to its Whistleblowing Policy and Anti-fraud and Corruption Strategy.
   4. Council Officers have their own Codes of Conduct, contractual obligations and respective professional standards to uphold.
   5. Elected Members are bound by the Members’ Code of Conduct, which is enshrined into Part 5 of the Council’s Constitution and Code of Corporate Governance. All Councillors receive training on the requirements of the Code of Conduct and related issues. The Monitoring Officer provides reminders, advice and training to members on decision making and standards of conduct. The Members’ Code of Conduct Committee is well established and its functions, terms of reference and delegated powers are listed in Part 3 of the Council’s Constitution and Code of Corporate Governance. These include advising on appropriate strategies and actions to maintain and promote high standards of conduct; monitor and review the Code of Conduct and the effectiveness of standards procedures and policies; to advise on or arrange training; and to receive reports, conduct hearings and determine action in respect of allegations and complaints of Members breaching the Code of Conduct.
      
      Ensuring Openness and Comprehensive Stakeholder Engagement
   6. Bexley communicates with its Stakeholders through various platforms including:
      • partnership forums and groups, and service user forums
      • information and press releases on the Councils website and Social Media channels
      • poster campaigns across the Borough run by partners JC Decaux and
      • Community Champions
      • quarterly Bexley Magazine distributed to residents
   7. The network of Community Champions was established in 2020/21 during the pandemic to help us communicate and engage with our residents about the virus and other important issues that affect their wellbeing. They continue to work with their neighbours, the Council and the Local Care Partnership (NHS), focussing on activities improving the health and wellbeing and / or immediate environment of local people.
   8. The Council engages its residents through partnerships with key stakeholder groups ranging from large public organisations (e.g., the Metropolitan Police), through third sector and voluntary sector organisations (e.g., Bexley Voluntary Service Council), to citizen run networks such as the Neighbourhood Watch. Its residents also directly contribute to determining and realising Bexley’s vision, through public consultations, formal forums, and informal meetings.
   9. Individual elected Members engage with residents, businesses, and organisations in their Wards and across the Borough in a variety of ways and bring the knowledge, information and experiences to inform decision-making and overview and scrutiny processes within the Council.
      
      Defining Outcomes in Terms of Sustainable Economic, Social and Environmental Benefits
   10. The strategic vision for Bexley is set out in #Making Bexley Even Better. To deliver this vision  the Council defines specific outcomes, performance indicators and actions and relates these  to specific services. Operational and financial performance is reviewed by senior leaders at Directorate Leadership Teams and by Corporate Leadership Team.
       
       Determining the Intervention Necessary to Achieve Intended Outcomes
   11. The Council continues to prioritise and monitor its resources against agreed plans and outcomes, continually assessing value for money on behalf of its residents. Directorate Leadership Teams review regular management performance information provided by their services assessing and adjusting for any variances from the Corporate Plan or Medium Term Financial Strategy. This process is scrutinised by Corporate Leadership Team, Cabinet and Scrutiny Committees. Key Performance Indicators (KPIs) are regularly published to support the monitoring of performance.
       
       Developing the Entity’s Capacity, including the Capability of its Leadership and the Individuals within it
   12. The role of Officers, the Cabinet, Overview and Scrutiny Committees and regulatory committees are set out in the Constitution and Code of Corporate Governance. Both Officers and Members are regularly offered and provided with training and guidance in relation to the London Borough of Bexley’s Code of Conduct, principles of good decision-making, ICT facilities, information governance and any mandatory elements important to their role.
   13. Senior Officers are provided with a number of opportunities to enhance their skills, including coaching/mentoring, attending seminars and membership of professional networks.
   14. All Members attend an induction programme and receive additional training relevant to specific roles, including dedicated training for Members of the Planning Committee, Licensing Committee and Pensions Committee. Members of Overview and Scrutiny Committees have attended workshops to share examples of good practice. Overview and Scrutiny Committee Chairmen meet regularly to review new guidance and review the success of their approach, to coordinate work between Overview and Scrutiny Committees and to instil a deep understanding of their role and responsibilities.
   15. The Monitoring Officer provides on-going advice in connection with the legal standing of Council business and advice to Councillors on their responsibilities, alongside the maintenance/monitoring of the Constitution. To enable the Monitoring Officer to conduct their statutory role, in accordance with Section 5 Local Government and Housing Act 1989, the Monitoring Officer has access to all reports, attends key officer and committee meetings and is able to launch investigations in the eventuality of a breach of conduct.
   16. The Council has in place a Top Management Review Panel. This Panel is a Committee that carries out the annual performance appraisals in respect of the Chief Executive and Directors.
       
       Managing Risks and Performance Through Robust Internal Control and Strong Public Financial Management
   17. The revised Risk Management Strategy, which is reviewed annually, was adopted by the General Purposes   & Audit Committee in March 2019. A revised version was presented to the General Purposes & Audit Committee in October 2020.
   18. The Strategic Risk Register has been reviewed regularly during 2022/23 by Corporate and Directorate Leadership Teams. It has been presented to the General Purposes & Audit Committee in July and November 2022.
   19. It is important that risks are triangulated effectively with the Corporate Plan and the Medium Term Financial Strategy (MTFS), as well as other Corporate performance monitoring and the budget management and reporting process. A greater focus on highlighting risks will also be prominent in corporate decision-making, including in published decisions.
   20. The Council’s Anti-Fraud and Corruption Strategy lays out measures, processes and responsibilities for the prevention, deterrence and detection of fraud and corruption. Financial Regulations, Contract Procedure Rules, and Codes of Conduct for Members and employees adds to this framework. A close working relationship between the Counter Fraud and Internal Audit teams allows for the identification of control weaknesses. Detection is enhanced through participation in data-matching exercises with the National Fraud Initiative and best practice is kept current through Membership to the National Anti-Fraud Network.
   21. Regular updates of anti-fraud activities which take place are provided to the General Purposes & Audit Committee.
       
       Implementing Good Practices in Transparency, Reporting and Audit to Deliver Effective Accountability
   22. The London Borough of Bexley has processes in place to ensure the Council provides clear, accurate and impartial information. The information supports the regular review of the Council’s finances, ensuring medium term business/financial plans are aligned with strategic objectives and that public money is safeguarded. Work is underway to improve and strengthen those processes, including the analysis of budgets and monitoring of income and expenditure.
   23. The Council brought the shared services in-house from 1 August 2020 and has used this as an opportunity to review and improve its financial processes. A Finance Improvement Plan is in place and has been presented to the General Purposes & Audit Committee and Resources & Growth Overview and Scrutiny. Progress on the Finance Improvement Plan is reported bi-annually.
   24. The Council has a clear performance framework in place, agreed by the Corporate Leadership Team and Members. It updates its corporate performance indicators each year to reflect corporate policies, and these are reported regularly to Members. In 2021/22 it was ensured that key performance indicators were re-established in all Directorates and a number Corporate Performance Indicators are reported consistently to Members. This allows Members to scrutinise policies and decisions, consider interventions to support outcomes and monitor key financial and service area risks.
   25. To aid with transparency and accountability to residents, businesses and interested parties, minutes of key meetings, decisions, all items of expenditure exceeding £500, and registers of interest are all published on the Council’s website. Also detailed will be any approvals pertaining to BexleyCo Limited’s (the Council’s wholly owned subsidiary) annual business plan and the sanctioning of restricted financial matters relating to the company e.g., business loans and property and land purchases.
   26. The system of internal control has been designed to manage the risks of Bexley not achieving its objectives to a reasonable level. It is a continuous process with significant risks being identified and brought to the attention of senior management and Members. Internal audit assesses the overall quality of these controls and makes, where necessary, recommendations for improvements.
       
       BexleyCo Homes Ltd
   27. Bexley Council wholly owns BexleyCo Homes Ltd, which was established to deliver private and affordable homes within the Borough, with its first development of 58 new homes and apartments initiated in December 2019. Most works are now complete on the first site and people have moved into the market homes and to the affordable social rented homes that have been built. The    activities of BexleyCo are overseen by a Board, consisting of an independent Chair and two Non-Executive Directors, which reports regularly to the Council, also presenting an annual refresh of its business plan. As the company is now actively engaged in developing residential sites, further assurance on the internal control environment will be provided through the Internal Audit plan for 2022/23.
5. Review of Effectiveness
   1. The London Borough of Bexley has responsibility for conducting, at least annually, a review of the effectiveness of its governance framework including the system of internal control. The review is informed by:
      • work undertaken by the Chief Executive and the Corporate Leadership Team
      • Head of Assurance’s Annual Report and
      • External Auditors comments
      Effectiveness is assessed on the criteria:
      • extent to which the Authority complies with the principles and elements of good governance set out in the Framework
      • identifies systems, processes and documentation that provide evidence of compliance
      • identifies the individuals and committees responsible for monitoring and reviewing the systems, processes and documentation identified
      • identifies issues that have not been addressed in the Authority and consider how they should be addressed and
      • identifies the individuals who would be responsible for undertaking the actions required
   2. The review is led by the Head of Assurance and includes input from the Monitoring Officer, Directors and other Senior Managers. The results of the review are then considered by the Finance and Corporate Services Directorate Leadership Team before being presented to the Chief Executive and Leader of the Council.
6. Head of Internal Audit and Assurance Opinion
   1. Internal Audit is an assurance function that provides an independent and objective opinion to Bexley Council on its control environment. It operates to defined standards as set out in the Public Sector Internal Audit Standards (PSIAS).
   2. Bexley’s Internal Audit, Counter Fraud and Risk Management Services are provided in house under the Head of Assurance and Risk.
   3. The Head of Assurance opinion for 2022/23, based on the work undertaken by the Internal Audit service, is that reasonable assurance can be provided that the Council has an adequate control framework in place.
   4. The Council has continued to embed effective risk management into its business activities during 2022/23 and the internal audit plan for this period has focussed on providing assurance over the key risks facing the organisation.
   5. As a result of audit work undertaken during 2022/23, the significant risk areas facing the Council which Internal Audit will focus on during 2023/24 will include:
      • the effectiveness of budget monitoring across the Council
      • inflation pressures on service delivery and contract negotiations
      • procurement processes
      • key financial services - Debt management and recovery
      • data management across the Council; and
      • the management of cyber security threats and digital disruption
   6. The General Purposes & Audit Committee receives regular updates regarding the internal audit work plan, and risks and control issues identified during audits are highlighted in these reports.
7. Conclusion
   1. We, the Chief Executive and Leader of the Council have been advised on the implications of the result of the review of effectiveness of the governance framework by the General Purposes & Audit Committee and that the arrangements continue to be regarded as fit for purpose in accordance with the governance framework. The areas already addressed and those to be specifically addressed with new action plans are in the section below.

Chief Executive
Jackie Belton

Leader of the Council
Cllr Teresa O’Neill, OBE

Appendix 1 - Progress Update regarding the Significant Governance Issues identified in the 2021/22 Annual Governance Statement and agreement of additional issues for inclusion in the 2022/23 statement