We were aware that our contract with our Highways contractor (Ringway Jacobs) wasn’t working as well as we had intended, so we carried out our own internal audit of the management of the contract. We concluded that there were concerns which resulted in a ‘limited assurance opinion’ in January 2020.
In light of this, Ernst and Young LLP undertook a further audit. They particularly focussed on the risks of non-compliance with laws and regulations, fraud and irregularities in Highways contract management. The independent review findings were in line with our own. They did not identify any instances of non-compliance with laws, regulations or other irregularities in the contract management, but they did identify the need for improvements in contract management arrangements.
The Ernst and Young LLP report was discussed at the Council’s Audit Committee in March 2021. An external auditor’s report is normally confidential, however In the interests of transparency and public interest we have published it.
It is worth noting three important points:
- the report is a review of Council management of the contract and not a review of the contractor’s performance
- the report review period was some time ago (2019/20) and improvements have already been made to our management of the contract
- while there were clearly areas for improvement in the contract management, there are no suggestions that anyone was gaining from the identified poor practice.
The report also concluded that there is no fundamental problem with management integrity and commented that management were actively seeking to improve the contract management.
Prior to these audits, having already recognised we needed to make changes to improve our contract management, we restructured the team and added more senior level contract management to the team.
We have made demonstrable improvement in terms of how we manage the contract.
We have developed improvement plans to improve the procedural weaknesses and over half of the corrective measures are already in place and embedded in the service.
81% of the KPIs are now on target compared to just 38% the previous year, and the latest Future Highways Research Group (FHRG) research also shows a significant improvement in their value for money assessment of Central Bedfordshire Council Highways.
We are absolutely committed to learning from these reviews, improving our approach as well as being transparent about our progress. As such, we will soon be undertaking another audit to review our progress. Highways contract performance will be discussed at Sustainable Communities Overview and Scrutiny Committee in July and the next internal audit will be reported to Audit Committee later in the year.