• Home
  • About
  • Subscribe
  • LATIF
  • Conferences
  • Dashboard
  • Edit My Profile
  • Log In
  • Logout
  • Register
  • Edit this post

Room 151

  • 151 BRIEF

    What's New?

  • Consultation opens on future of IFRS 9 statutory override

    August 12, 2022

  • EAPF criticised for water company investments

    August 10, 2022

  • Welsh pension fund confirms £50m investment in clean energy

    August 10, 2022

  • Inflation ‘disastrous’ for local services, warns LGA

    August 10, 2022

  • Consultation opens into care charging reforms

    August 9, 2022

  • ADASS survey: ‘worst fears confirmed for adult social care’

    August 5, 2022

  • Treasury
  • Technical
  • Funding
  • Resources
  • LGPS
  • Development
  • 151 News
  • Blogs
    • David Green
    • Agent 151
    • Dan Bates
    • Richard Harbord
    • Stephen Sheen
    • James Bevan
    • Steve Bishop
    • Cllr John Clancy
    • David Crum
    • Graham Liddell
    • Ian O’Donnell
    • Jackie Shute
  • Interviews
  • Briefs

CIPFA calls for due respect for section 151 officers

0
  • by Ian McDiarmid
  • in 151 News · Treasury
  • — 5 Dec, 2018

CIPFA has called for councils’ chief financial officers to be accorded the importance they deserve.

In its response to feedback on its proposals  for a financial resilience index for English councils it said: “With regard to the role of the section 151 officer, CIPFA is growing increasingly concerned that the position and consequent authority of the CFO is slipping further away from the top table”.

CIPFA highlights that a local authority’s CFO is not always a board member – a practice which is “out of kilter with all other major organisations in the public and private sector”.

One aim of its resilience index is to help CFOs by giving their views the back-up of the concerns of an independent body.

CIPFA hopes in time to make it a requirement to refer to the indicators in Section 25 statements, which cover the robustness of budget estimates and the adequacy of financial reserves.

The original proposal, made in July, was for an index made up of a set of six tests leading to a ‘traffic-light’ rating.

The scheme would have ranked the councils within each criterion and then combined the scores to give an overall rank.

The two most heavily weighted items within the six criteria related to reserves: the total level of reserves, excluding schools and public health as a proportion of net revenue expenditure; and the percentage change in reserves, excluding schools and public health, over the past three years.

These were each weighted 0.25 in the overall score.

The other criteria were the ratio of government grants to net expenditure (0.1), the proportion of net revenue expenditure accounted for by children’s social care, adult social care and debt interest payments (0.15), Ofsted’s overall rating for children’s social care (0.15), and the auditor’s value-for-money judgement (0.1).

CIPFA’s consultation ran from July to the end of August and stirred up huge interest with it receiving 189 responses.

The overall idea received broad support. “There was little dissent over the fact that CIPFA is doing the right thing in drawing attention to a matter of high national concern,”

The replies showed a general belief that the single composite figure would be unhelpful however, and few respondents agreed with choice of the original indicators and their weightings.

One particular concern was that a publicly available index of resilience would be used: “ … to stigmatise less resilient authorities and generally put too much emphasis on financial considerations at the expense of local context and broader governance considerations”.

The other criticism was over the subjectivity in the weightings of the components, undermining the relevance of the overall score as a tool for comparison.

CIPFA has in response ditched its plan for an overall score and has added a new indicator ­– the reserves depletion period ­– which will show how long a councils’ reserves would last if reserves are depleted at the same as over the past three years.

In the first year the tool will be provided to councils and their auditors before being made available publicly next year.

Get the Room 151 Newsletter

Share

You may also like...

  • On the hunt in high yield 24th May, 2021
  • The vaccine may help settle cash flows but inflation remains a risk 13th Jan, 2021
  • 2021 and a year of two halves 12th Jan, 2021
  • Collaboration the key to district recovery post-pandemic 13th Apr, 2021

Leave a Reply Cancel reply

You must be logged in to post a comment.

  • 151 BRIEFS – WHAT’s NEW?

    • Consultation opens on future of IFRS 9 statutory override
    • EAPF criticised for water company investments
    • Welsh pension fund confirms £50m investment in clean energy
    • Inflation ‘disastrous’ for local services, warns LGA
    • Consultation opens into care charging reforms
  • Room151’s LGPS Roundtables

    Biodiversity
    Valuations & Risk
    LGPS Women

  • Room151’s LGPS Roundtables

    Biodiversity
    LGPS Women
    Valuations & Risk
  • Latest tweets

    Room151 4 days ago

    LATIF/FDs’ Summit ‘on course to be biggest yet’: Room151’s flagship event – the Local Authority Treasurers Investment Forum (LATIF) and FDs’ Summit – is on course to be the biggest yet, with more than 200 delegates expected. Combining[...] dlvr.it/SWSDrL pic.twitter.com/f8FXzcAdWB

    Room151 4 days ago

    ‘Local government treated worse than any other part of public sector’: Clive Betts, chair of the Levelling Up, Housing and Communities Committee, talks to Mike Thatcher about lack of progress on levelling up, pork-barrel politics and why local government… dlvr.it/SWRk1L pic.twitter.com/Jpw0BsOsy3

    Room151 5 days ago

    Which LGPS pools and funds are attending the LGPS Investment Forum on Nov 2 & the LGPS Private Markets Forum on Nov 1st? Answer here: lnkd.in/eDHU8tuy pic.twitter.com/D3gd63Rh7F

    Room151 6 days ago

    LGPS and levelling up: nothing to fear but fear itself: There have been a number of objections to government plans for LGPS funds to invest 5% of their assets in local projects. But George Graham says these objections can be[...] dlvr.it/SWL7vt pic.twitter.com/ebwBEkZTy4

    Room151 6 days ago

    George Graham @SYpensions @bordertocoast channels his inner FDR in a call for local government pension funds to avoid the fear factor and embrace levelling up #LGPS #localgov room151.co.uk/local-governme…

    Room151 7 days ago

    Changes to rules on capital receipts raise wider questions: Stephen Kitching argues that DLUHC’s latest rule changes are part of a series following on from revisions to MRP guidance and the purchase of commercial property. He questions whether… dlvr.it/SWGqKC pic.twitter.com/Ycr5hWZDPk

    Room151 1 week ago

    ‘No ifs, no buts’: the Bank of England continues its battle with inflation: Partner Content: CCLA Investment Management’s Robert Evans discusses the MPC’s 0.5% increase in the Official Bank Rate and its ongoing commitment to the 2% inflation target… dlvr.it/SW7SNC pic.twitter.com/ryOzYRSNA9

    Room151 2 weeks ago

    DLUHC changes rules on flexible use of capital receipts: The levelling up secretary has written to all council leaders to amend the rules concerning the flexible use of capital receipts to fund transformation projects. In his letter, Greg Clark[...] dlvr.it/SW3jyX pic.twitter.com/KEhSSaMITl

    Room151 2 weeks ago

    Local audit and financial reporting: let’s take back control: Mazars’ Suresh Patel suggests three steps that auditors and council finance teams should take to help get financial reporting and local audit back on track. Following my recent appearance… dlvr.it/SW0PfV pic.twitter.com/miL7pjukce

  • Register to become a Room151 user

  • Previous story Labour council leaders demand more cash
  • Next story Sale-and-leaseback: the accounting lowdown

© Copyright 2022 Room 151. Typegrid Theme by WPBandit.

0 shares