NORTH WALES FIRE AND RESCUE AUTHORITY

Minutes of the meeting of North Wales Fire and Rescue Authority held on Monday 9 November 2020 via Zoom.

PRESENT

Councillor Representing
P Lewis (Chair) Conwy County Borough Council
B Apsley Wrexham County Borough Council
M Bateman Flintshire County Council
B Blakeley Denbighshire County Council
A Davies Denbighshire County Council
M Ll Davies Denbighshire County Council
M Dixon Wrexham County Borough Council
A I Dunbar Flintshire County Council
P Evans Denbighshire County Council
V Gay Flintshire County Council
J B Hughes Gwynedd Council
E W Jones Anglesey County Council
S Lloyd-Williams Conwy County Borough Council
G Lowe Wrexham County Borough Council
R E Parry Conwy County Borough Council
D Rees Anglesey County Council
R Roberts Wrexham County Borough Council
P Shotton Flintshire County Council
A Tansley Conwy County Borough Council
W O Thomas Flintshire County Council
G G Williams Gwynedd Council
D Wisinger Flintshire County Council

Also present:

S A Smith (Chief Fire Officer and Chief Executive); C Everett (Clerk and Monitoring Officer to the Authority); K W Finch (Treasurer to the Authority);
R Fairhead and K Roberts (Assistant Chief Fire Officers); S Morris and H MacArthur (Assistant Chief Officers); G Owens (Deputy Clerk); T Williams (Corporate Communications Manager); A Davies (Member Liaison Officer).

APOLOGIES

Councillor Representing
R Griffiths Anglesey County Council
B Parry-Jones Wrexham County Borough Council
G A Roberts Gwynedd Council
N Smith Conwy County Borough Council
 
1 DECLARATIONS OF INTEREST

1.1 There were no declarations of interest.

2 NOTES OF CANCELLED MARCH 2020 MEETING AND RATIFICATION OF DECISIONS TAKEN

2.1 The Clerk presented the report which explained that the March FRA meeting had been cancelled due to COVID-19 and that Members had received all reports electronically and had been given the opportunity to comment should they so wish – no comments had been received.

2.2 It was noted that the majority of reports were able to be approved by the Chair via delegated authority. However, the following reports required ratification of the Authority:

1. Improvement and Well-Being Plan 2020/21
2. Capital Strategy and Treasury Management
3. Pay Policy Statement 2020/21
4. Strategic Equality Plan: The Equality Act 2010 (Statutory Duties) (Wales) Regulations 2011

2.3 These reports had been published in line with relevant legislation requirements with a note explaining that they would be ratified by the full Authority at the next available meeting.

2.4 RESOLVED to approve the report and ratify the reports noted above.

3 MATTERS ARISING

3.1 There were no matters arising.

4 URGENT MATTERS

4.1 There were no urgent matters.

5 CHAIR’S REPORT

5.1 The Chair’s report has routinely been an opportunity to update Members about the meetings and events attended by the Chair and Deputy Chair. However, in light of the COVID-19 impact on 2020, the report paid tribute to all members of staff of NWFRS for their hard work since March 2020. The Chair also commended the Chief Fire Officer for providing updates to Members on a regular basis.

5.2 It was confirmed that all meetings attended by the Chair and Deputy Chair had been held virtually.

5.3 RESOLVED to note the information provided.

6 COVID-19 UPDATE

6.1 The Chief Fire Officer presented the report which advised Members of the activities of the North Wales Fire and Rescue Service since the outbreak of the coronavirus pandemic in March 2020.

6.2 Members congratulated the Service for continuing to deliver its services as well as it has since the COVID-19 outbreak. Members were also pleased to note that the Service’s collaboration approach has continued and that the Service has provided support to other organisations during the pandemic.

6.3 RESOLVED to note the contents of this report.

7 DRAFT ASSESSMENT OF THE AUTHORITY’S PERFORMANCE 2019/20

7.1 ACO Morris presented the draft assessment of North Wales Fire and Rescue Authority’s performance during 2019/20 in relation to its progress towards achieving its long-term improvement and well-being objectives, and medium-term equality objectives and its compliance with applicable Welsh Language Standards.

7.2 It was noted that the Authority had made good progress last year towards achieving its long-term improvement and well-being objectives. This was in part through the successful delivery of the planned actions outlined in the Authority’s published Improvement and Well-being Plan for 2019/20. Steady progress was also made during the year towards achieving the Authority’s 2016-20 equality objectives and the Authority continued to comply with the applicable Welsh Language Standards.

7.3 Members welcomed the report and that the work around well-being had been included. Members were also pleased to note the Service’s compliance with the Welsh Language Standards had been maintained and that there had been no complaints for the third year running. The Chair commented on the Service’s positive work and endeavours to continue to share the safety message with young people with poster competitions and various other initiatives that have taken place online this year.

7.4 It was noted that having received the outcome of work undertaken by Audit Wales that looked specifically at how the Authority involves stakeholders when proposing service and policy changes, a report will be presented to the Executive Panel outlining the actions that will be taken in order to improve the Authority’s engagement and having a more integrated approach to involvement.

7.5 RESOLVED to

(i) retrospectively approve the draft assessment of the Authority’s performance in 2019/20 (subject to minor additions and corrections if required) which had already been published on the Authority’s website by the statutory deadline of 30/10/2020; and
(ii) note the Service’s intention to publish a simple summary version of the key elements of the assessment report;
(iii) note that a report and action plan in terms of the Authority’s involvement work will be presented to the next Executive Panel meeting.

8 IMPROVEMENT AND WELL-BEING PLAN 2021/22

8.1 ACO Morris presented the report which confirmed the basis of the Fire and Rescue Authority’s Improvement and Well-Being Plan for 2021/22.

8.2 Members were reminded of the process the Authority follows in order to publish an Improvement and Well-being Plan every year. Members were asked to confirm whether they wanted the Authority to continue to pursue the objectives adopted in March 2020, or a revised set. ACO Morris explained that in view of how recently the Authority had adopted its current set of objectives, the inevitable limiting effect of the COVID-19 pandemic on progress during the current year, and the likely change of Authority membership after Local Government elections in May 2022, that Members were recommended to carry over the Authority’s existing objectives into 2021/22.

8.3 RESOLVED to approve the development of a draft Improvement and Well-being Plan 2021/22 that is based on a continuation of the Authority’s current set of improvement and well-being objectives.

9 PREPARATION FOR THE UK’S WITHDRAWAL FROM THE EUROPEAN UNION (BREXIT)

9.1 ACFO Fairhead presented the report which informed Members of actions being taken by North Wales Fire and Rescue Service during the transition period following the UK’s withdrawal from the European Union on 31 January 2020.

9.2 It was noted that the Service is holding meetings internally to identify and seek to mitigate any potential issues for delivering fire and rescue services and externally via the Local Resilience Forum (LRF) working with partners to identify and reduce any impacts for the wider community of North Wales.

9.3 ACFO Fairhead confirmed that officers are maintaining a watching brief of the national situation and will adapt the Service’s Brexit related work as required.

9.4 Members thanked officers for the comprehensive report and it was
RESOLVED to note the information provided.

At this juncture, Cllr R Roberts left the meeting.

10 LEGAL CHALLENGE TO THE 2015 PENSION REFORMS

10.1 ACO MacArthur presented the report which gave Members an update on the legal challenge to the implementation of the firefighter pension scheme reforms which were brought into effect in 2015. The successful legal challenge was brought by the Fire Brigades Union (FBU) on behalf of its members on the grounds of direct age discrimination. The outcome has implications across all public sector pension schemes.

10.2 Members were reminded of the details around the McCloud/Sargeant Judgment and that the Court of Appeal ruled in favour of the claimants and confirmed that the age discrimination inherent within the 2015 pension reforms had not been justified.

10.3 It was acknowledged that this was a complex and lengthy case and in order to support the process of determining appropriate remedy, HM Treasury issued a consultation document setting out a range of options for addressing the discrimination across all public sector schemes. A copy of the Authority’s response had been appended to the report.

10.4 Members noted that the UK Government has already confirmed that the outcome will be applicable across all UK public sector pension schemes.

10.5 In response to a Member’s question, ACO MacArthur explained that the Service is not yet able to process claims from individual members as the remedy proposals have not been finalised. However, it was confirmed that once the Regulations are published the Service will have a communication plan in place to deal with members’ queries.

10.6 The Chair thanked the officers for their work on this complex matter.

10.7 RESOLVED to note the:

(i) background to the McCloud/ Sargeant Judgment;
(ii) current position with regards to remedy;
(iii) financial implications of the remedy; and
(iv) consultation response submitted on behalf of the Authority.

11 FIREFIGHTERS PENSION SCHEMES LOCAL PENSION BOARD – ANNUAL REPORT 2019-20 AND UPDATED TERMS OF REFERENCE

11.1 ACO MacArthur presented the annual report of the Local Pension Board and its reviewed terms of reference.

11.2 Members were reassured to note that the Local Pension Board members are expected to undertake a significant amount of training in order to undertake their role on the Board.

11.3 RESOLVED to

(i) approve the local pension board annual report 2019-20 for publication on the Authority's website; and
(ii) note the terms of reference.

12 FIREFIGHTERS PENSION SCHEMES DISCRETIONARY POLICY STATEMENT

12.1 ACO MacArthur presented the report which informed Members of the requirement for the Scheme Manager (the Authority) to produce a Firefighters Pension Discretionary Policy Statement. It was noted that the report had been considered by the Local Pension Board on 27 May 2020 and no issues of note were highlighted.

12.2 It was noted that the Firefighters’ Pension Scheme Regulations provide the Authority with the responsibility to make decisions on certain discretionary elements of the scheme. The Authority is required to formulate and publish a discretionary policy which sets out how it will discharge this responsibility. ACO MacArthur highlighted that any legal or contentious issues that arise are referred to the Authority’s lawyers.

12.3 RESOLVED to approve the resolutions within the Firefighters Pension Scheme Discretionary Policy Statement including, where appropriate, the delegation to the Chief Fire Officer and Treasurer.

At this juncture, Cllr A Tansley left the meeting.

13 INTERNAL AUDIT ANNUAL REPORT 2019/20

13.1 Keith V Williams, from Conwy CBC’s Internal Audit Department, presented the internal audit annual report 2019/20. The report presented to Members analysed the work of the Internal Audit Service for 2019/20 and contained the assurance statement based on the work of Internal Audit during the year ended March 2020.

13.2 Mr Williams asked Members to note the typographical error in relation to the Fleet Management audit opinion which should read ‘satisfactory’ not ‘high’.

13.3 It was confirmed that the Head of Internal Audit is able to provide assurance, based on the internal audit work undertaken, together with the Internal Audit department’s maintained knowledge of the organisation and its procedures, that the Authority has effective corporate governance, risk management and internal control arrangements to manage the achievement of the Authority’s objectives.

13.4 It was noted that the work of Internal Audit has not identified any weaknesses that would qualify this opinion and there are no significant issues that are relevant to the preparation of the annual governance statement. The report also contained assurance that the Internal Audit Service operates in compliance with the UK Public Sector Internal Audit Standards to enable the Authority to take assurance from this opinion.

13.5 Having had the opportunity to ask questions of Mr Williams, it was
RESOLVED to note the content of the Head of Audit and Procurement’s annual report and the overall ‘opinion’ upon the adequacy and effectiveness of the Authority’s framework of governance, risk management and control.

At this juncture, Cllr J B Hughes left the meeting.

14 AUDITED STATEMENT OF ACCOUNTS AND ANNUAL GOVERNANCE STATEMENT 2019/20

14.1 ACO MacArthur presented the audited statement of accounts for 2019/20 including the annual governance statement. The report also presented the findings of the Auditor General for Wales which confirmed an unqualified audit opinion.

14.2 It was noted that the draft accounts were submitted for audit on
29 May 2020. These confirmed net expenditure of £35.226m resulting in a contribution to reserves of £0.011m and the final audited position remains unchanged.

14.3 In compliance with the Accounts and Audit (Wales) (Amendment) Regulations 2010, it is a requirement that the audited accounts and annual governance statement are approved by Members by
31 July 2020. However due to the COVID-19 pandemic, the Accounts and Audit (Coronavirus) (Amendment) Regulations 2020 No.404 extended the publication date of the Accounts to 30 November 2020.

14.4 ACO MacArthur wished to place on record her appreciation of all the work that had been undertaken by Helen Howard, the Head of Finance for NWFRS, and Graham Williams from CCBC in finalising the accounts despite the challenges due to the pandemic. This was reiterated by Members.

14.5 Amanda Hughes from Audit Wales presented the audited accounts report to Members and confirmed that an unqualified audit opinion will be issued on the accounts subject to the Authority sending a letter of representation, as outlined in the report, to the Auditor General for Wales.

14.6 Ms Hughes also drew Members’ attention to “Emphasis of Matter – effects of COVID-19 on property pension asset valuations” – in relation to material valuation uncertainty clauses in the valuation report on Pooled Property Funds, held by the Clwyd Pension Fund, arising from circumstances caused by the COVID-19 pandemic. However, this does not modify the opinion.

14.7 RESOLVED to

(i) approve the audited outturn position and performance as detailed within the 2019/20 Statement of Accounts;
(ii) approve the earmarked reserves carried forward as at 31 March 2020;
(iii) approve the governance arrangements and action plan as outlined within the 2019/20 Annual Governance Statement;
(iv) note the report of the Auditor General for Wales which confirms an unqualified audit opinion; and
(v) approve the proposed letter of representation.

15 TREASURY MANAGEMENT ACTIVITY AND ACTUAL PRUDENTIAL INDICATORS FOR 2019/2020

15.1 Graham Williams from Conwy CBC presented the report which informed Members of the treasury management activity and prudential indicators for the Authority during the 2019/20 financial year. This report is a requirement of the Prudential Code.

15.2 It was noted that the Authority’s treasury management activities are regulated by professional codes, statutes and guidance. The borrowing position at 31 March 20020 was £30.9m which is within the limit approved by Members. The value of short term loans was £16m which is within the limit set within the strategy. No variable rate loans were held during the financial year.

15.3 RESOLVED to note the treasury management activity; and approve the final prudential indicators for 2019/20.

16 TREASURY MANAGEMENT AND PRUDENTIAL INDICATORS 2020/21

16.1 Graham Williams presented the report to Members. A requirement of the CIPFA Prudential Code for Capital Finance is that Prudential Indicators are monitored on a regular basis and any significant changes approved. Similarly, under the CIPFA Code of Practice on Treasury Management, any changes in long term borrowing and changes to the Authority’s counterparty investments are required to be reported to Members.

16.2 Members noted that the Capital and Treasury Management Strategy for 2020/21 were in the meeting papers circulated to members for the Fire and Rescue Authority meeting of 16 March 2020. Since that time the prudential indicators have been revised and are included within this report for approval.

16.3 RESOLVED to approve the amended Prudential Indicators set out in appendix A of the report.

17 PROVISIONAL OUTTURN 2020/21

17.1 ACO MacArthur presented the report which informed Members about the projected revenue and capital expenditure position, as at
30 September 2020.

17.2 It was noted that the Authority approved a revenue budget of £35.9m at its meeting on 16 December 2019 and the forecast outturn position remains that the Authority will achieve a breakeven against this budget. However, Members were informed that during the course of the year it has been necessary to review the allocation of the budget across the income and expenditure headings and it is anticipated that further amendments will be required during the financial year to reflect the ongoing challenges arising from the COVID-19 pandemic.

17.3 Also in December 2019, the Authority had approved a capital budget of £4.1m. Due to the restrictions faced by the COVID-19 pandemic, this has been reviewed and revised to £1.0m. Since the programme was revised, projects in relation to building works and fire appliances have been delayed and some ICT schemes have also been delayed due to the reprioritisation of the work of the ICT team to manage the transition to remote working. It is anticipated that the deferred schemes will be completed in 2021/22.

17.4 RESOLVED to

(i) note the draft revenue and capital outturn positions as noted above;
(ii) approve the budget realignment request.

At this juncture, Cllr B Apsley left the meeting.

18 MEDIUM TERM FINANCIAL STRATEGY 2021/24 AND BUDGET 2021/22

18.1 ACO MacArthur presented the medium term financial strategy 2021/24 and the draft revenue and capital budgets for 2021/22.

18.2 Members were reminded of the requirement for the Authority to set a balanced budget each financial year and confirm provisional contribution figures to each constituent authority by the end of December preceding the start of the financial year. It was noted that the budget for 2021/22 and the medium term financial strategy include a number of key assumptions, risks and uncertainties which have been identified during the budget planning process.

18.3 The draft budget had been risk assessed and the following key risks noted:
• the budget is based on an assumption that pay awards will be 2%. National agreements have not yet been reached;
• the planning assumption is that Welsh Government support for the increase in firefighters pensions will continue. If this is not supported there is a risk of £1.1m;
• the planning assumption is that Welsh Government funding of £0.4m will continue in respect of the national emergency service network (Airwave grant);
• the Authority plans to continue to develop an Environmental Strategy during 2021/22. An assessment of costs has not yet been made; and
• the uncertainty over the EU Exit remains and no additional costs have been factored into the 2021/22 budget.

18.4 ACO MacArthur informed Members that she had met with Directors of Finance of all local authorities in North Wales and set out the Authority’s approach. Each Director of Finance had been made aware of the contribution figures provisionally set for each local authority.

18.5 The Clerk commented that it was important to note that the budget is set on existing service delivery models and the budget could not be reduced further without revising these.

18.6 RESOLVED to
(i) approve the capital and revenue budgets for 2021/22 based on an increase in contributions from constituent authorities of £1.13m and noting that this is based on current estimates and situation;
(ii) note the key risks and uncertainties identified during the budget planning process as noted above; and
(iii) endorse the Medium Term Financial Strategy 2021/24.

19 PRINCIPAL OFFICERS' PAY AWARD 2020

19.1 The Clerk presented the report which asked Members to note and endorse the arrangements for agreeing the annual pay awards for Principal Officers for 2020.

19.2 The Clerk explained that the annual pay awards for Principal Officers are agreed using two different national negotiating body arrangements and the current position for each negotiating body is as follows:

i. the NJC has not yet reached agreement for 2020 in respect of the Chief Fire Officer and the Assistant Chief Fire Officers.

ii. The JNC agreement confirmed an annual increase of 2.75% with effect from 1 April 2020 applicable to the Assistant Chief Officers and the Treasurer.

19.3 RESOLVED to:

(i) note the negotiating and approval arrangements relating to the pay awards for Principal Officers;

(ii) approve the pay award of 2.75% for the Assistant Chief Officers and Treasurer with effect from 1 April 2020;

(iii) note the current position of the NJC with regards to the pay award for 2020 for the Chief Fire Officer and Assistant Chief Fire Officers; and

(iv) agree to the payment of the pending award for the Chief Fire Officer and Assistant Chief Fire Officers once the national NJC negotiations are concluded.

20 MEMBERS’ REMUNERATION SCHEME

20.1 The Clerk presented the report informing Members about the Independent Remuneration Panel Wales Report 2020/21 which sets out changes to members’ remuneration with effect from 1 April 2020. The Panel had recently published its draft report for 2021/22 and the proposed increases were included for information.

20.2 RESOLVED to

(i) note the IRPW’s determinations in relation to members’ allowances and remuneration as of 1 April 2020;

(ii) give delegated authority to the Clerk to update the schedule of member remuneration within the Authority’s constitution and to make any necessary amendments to the 2020/21 schedule from time to time during the municipal year, in order to reflect any changes in membership of the Authority, or as a result of any supplementary reports issued by the IRPW.

21 APPOINTMENT OF A FIRE AND RESCUE AUTHORITY MEMBER TO SERVE ON THE STANDARDS COMMITTEE

21.1 The Clerk presented the report which asked Members to appoint a Fire and Rescue Authority member to serve on the Standards Committee.

21.2 Due to Cllr Dylan Rees being the Deputy Chair of the Authority, the Standards Committee had asked that another member be nominated in order to prevent any possible conflict of interest arising.

21.3 RESOLVED to appoint Cllr Michael Dixon to the Standards Committee.

PART II

22 PENSION TREATMENT OF ELEMENTS OF PAY

22.1 ACO MacArthur presented the report which put forward recommendations for Members of the Authority in respect of negotiations with the Fire Brigades Union (FBU) relating to the pension status of certain elements of pay for employees who are members of the Firefighters’ Pension Schemes.

22.2 The report summarised the confidential and legally privileged legal advice received in relation to the settlement and sought approval from Members to implement the agreement.

22.3 ACO MacArthur explained the background to Members. The Authority, as the Scheme Manager for the Firefighters’ Pension Scheme, has a duty to ensure that the regulations are properly applied. The treatment of certain allowances as pensionable or non-pensionable has been subject to a number of challenges through the ombudsman and court processes. The most recent legal judgment has increased the likelihood of a legal challenge, or challenges, in respect of the day crewing and training allowances paid to North Wales Fire and Rescue Service employees. A report was circulated to Members in March 2020 and it was agreed that a negotiated settlement should be reached to avoid potential litigation.

22.4 It was noted that pension scheme matters would normally be considered by the Local Pension Board to support the Authority as Scheme Manager. However, the membership of the Local Pension Board includes employee representatives, which could potentially present a conflict of interest.

22.5 The Chair acknowledged the pragmatic approach of the FBU in the discussion and negotiations and commented that Members would appreciate that the Authority should follow legal advice provided, noting the risks outlined in the report. The Clerk also advised that Members should support the recommendations.

22.6 RESOLVED to

(i) note the content of the agreement;
(ii) note the confidential and legally privileged legal advice received; and
(iii) approve the collective agreement with the FBU.