Decision details

To consider the report of the Head of Finance in seeking approval to enter into a shared service arrangement with Hampshire County Council for the provision of Internal Audit Services. 

Arrangements are currently in place for the shared provision of the Chief Internal Auditor between the Council and Hampshire County Council.  This arrangement would further strengthen the resilience of the two teams and achieve budget savings. 

(i)  To agree in principle to support the establishment of an Internal Audit shared service partnership with Hampshire County Council and or West Sussex County Council, with Hampshire acting as host authority.

(ii)  That the Head of Finance (CFO) be given delegated authority to:

(a)  continue to explore the setting up of a partnership, and

(b)  subject to ensuring that the partnership will be at a minimum cost neutral or a saving to the Council and in consultation with the Head of Legal and Democratic Services, to enter into a Partnership Agreement with Hampshire County Council and or West Sussex County Council for the provision of a joint internal audit services function with effect from 1 April 2012 upon such terms and conditions as the Head of Finance (CFO) considers appropriate and reasonable.

(iii)  That following the signing of the Partnership Agreement and on commencement of arrangements that internal audit staff (as detailed in exempt  Appendix 1) be transferred under TUPE to Hampshire County Council.

Arrangements are currently in place for the shared provision of the Chief Internal Auditor between Southampton City Council and Hampshire County Council.  This proposal would build on existing arrangements and further strengthen the resilience of the internal audit function and provide the potential for future income streams as the partnership matures.

A number of alternative business models were considered including a fully outsourced service; however these were rejected on the basis of numerous considerations including cost, resilience, capacity and staff implications.