NORTH YORKSHIRE COUNCIL
AUDIT COMMITTEE
23 JUNE 2025
ASSESSMENT OF EFFECTIVENESS OF GOVERNANCE ARRANGEMENTS – CHILDREN AND YOUNG PEOPLE’S SERVICES
REPORT OF THE CORPORATE DIRECTOR – CYPS
|
|
|
1.0 PURPOSE OF THE REPORT |
|
|
|
1.1 To inform members of the results of the annual review of governance completed by the Children and Young People’s Service Directorate. The review has compared the governance arrangements which have operated within the Directorate over the last year to the Council’s expected principles of good governance as set out in the local code of governance. |
|
|
|
1.2 To provide details of the updated Risk Register, and the management of key risks for the Children and Young People’s Service Directorate. |
|
|
2.0 BACKGROUND
2.1 The Accounts and Audit Regulations (2015) require the Council to conduct a review, at least annually, of the effectiveness of its internal control systems and to report the results as part of the Annual Governance Statement.
2.2 The Council has approved and adopted a local code of corporate governance which is consistent with the principles of the CIPFA/SOLACE Framework Delivering Good Governance in Local Government (2016). Annual reviews of the effectiveness of each Directorate’s governance arrangements are undertaken and reported in accordance with the Audit Committee’s agreed work programme.
2.3 This is the first report in this format on the Directorate’s governance arrangements. It covers the period from May/June 2024 through to May 2025. The format and content will be refined in future years following engagement with the Audit Committee through this and other directorate reports. The intention in this report is to provide an assessment of the effectiveness of established governance arrangements in the CYPS directorate.
2.4 To deliver effective and efficient services the directorate must have a solid foundation of good governance and sound financial management. The directorate has a broad range of governance arrangements in place as well as a strategic monitoring and oversight role to ensure good governance is in place within local authority maintained schools.
2.5 The directorate aims to ensure that governance arrangements are proportionate and focused to enable services to deliver value for money across all of our activity. We will continue to amend and improve our governance arrangements in that regard. For example, in recent years, the directorate has established additional governance arrangements for contract management, climate change and capital delivery to strengthen and co-ordinate our oversight and actions. These – and other governance arrangements - are not static, but evolve incrementally to respond to emerging requirements or gaps as well as other changes within the council or from external issues.
2.6 In carrying out an annual assessment of effectiveness of the directorate’s governance arrangements, we have considered:
- Outcomes and overall performance with regard to our statutory obligations and organisational objectives;
- Consideration of the directorate’s governance arrangements with regard to the principles, sub-principles, actions and evidence contained within the agreed North Yorkshire Council Local Code of Corporate Governance. The seven key principles include:
Principle A: Behaving with integrity, demonstrating strong commitment to ethical values, and respecting the rule of law
Principle B: Ensuring openness and comprehensive stakeholder engagement
Principle C: Defining outcomes in terms of sustainable economic, social and environmental benefits
Principle D: Determining the interventions necessary to optimise the achievement of the intended outcomes
Principle E: Developing the entity’s capacity, including the capability of its leadership and the individuals within it
Principle F: Managing risks and performance through robust internal control and strong public financial management;
- Assurance from external inspection and regulators as well as from internal audit reports;
- The strategic risks identified through the Directorate Risk Register and the internal control frameworks that the directorate has in place to manage those risks.
3.0 ASSESSMENT OF EFFECTIVENESS
3.1 Being Young in North Yorkshire[1] is the North Yorkshire Safeguarding Children Partnership Strategy for children and young people living in North Yorkshire. This sets out the principles, goals, priorities and areas of focus for North Yorkshire and statutory partners in relation to children and young people. The strategy is overseen by the North Yorkshire Safeguarding Children’s Partnership Executive Board – progress on the strategy is reported on annually via the partnership’s annual report[2].
3.2 The directorate continues to demonstrate sound financial management; although there are clear budgetary pressures, the issues have been transparently identified and communicated to directorate leaders, Members and other stakeholders through quarterly corporate performance and financial reporting. Demand-led financial pressures particularly in SEND, children’s social care and Home to School Transport continue to present financial and operational challenges and the directorate is developing a response to those issues through service plans and transformation approaches.
3.3 The directorate works in a highly regulated area and regularly monitors and manages performance to meet national and local standards. Performance is reported to directorate leaders and Members, including Executive Members, Scrutiny, and Area Committees. Performance remains strong in a number of key service areas when benchmarked against other local authorities. Financial benchmarking through section 251 statutory returns show that North Yorkshire compares favourably to upper-tier and regional comparators on spending per head of population across most spending areas.
3.4 The directorate conforms with legislation, procedure rules and professional standards. Data on a number of school-related inclusion indicators (e.g. EHE, exclusions, EHCPs etc) shows increasing pressures within the education system which has given rise to a requirement for an increased local authority response. The directorate has transparently reported on these issues as well as developing a range of management actions to impact on the systemic issues, and reduce the financial pressure stemming from required interventions and obligations from the local authority. For example, as management action has started to improve the timeliness of assessment for pupils potentially requiring an Education Health and Care Plan, the number of complaints has been reduced.
3.5 Complaints, alongside FOIs and Ofsted complaints are regularly monitored. The directorate engages well with procurement processes for both revenue and capital. Delivery of capital projects is closely monitored through the CYPS capital delivery board reporting by exception into the Corporate Capital Board. Headline capital schemes (for example, a new primary school in Northallerton) have been delivered on time and on budget.
3.6 Key partnerships, including Schools Forum, the North Yorkshire Safeguarding Children Partnership, SEND Partnership Board, Healthy Child Board and Youth Justice Board are considered to be operating effectively.
3.7 Members have been supported to engage with a number of policy, service and financial issues through Members’ seminars as well as through the work of committees and individual correspondence. The directorate has evidenced strong stakeholder engagement (for example, through staff surveys, school closures, changes in policy). The directorate is open and clear in terms of financial pressures, proposed budget reductions and mitigating actions. For over ten years, the directorate has undertaken the biennial Growing Up in North Yorkshire survey providing rich data from over 15,000 pupils from across North Yorkshire to inform service delivery.
3.8 Senior finance and HR colleagues are ‘outposted’ as part of the Children and Young People’s leadership arrangements and help to provide corporate ‘glue’ to achieving effective governance arrangements.
3.9 The table below summarises the external inspections which provide assurance around the directorate’s performance:
|
Service area(s) |
Inspection and inspectorate |
Findings/report |
|
Children’s services
July 2023 |
Inspection of North Yorkshire local authority children’s services (Ofsted) – July 2023 |
Outstanding in all categories including in Overall effectiveness
|
|
Multi-agency
March 2025 |
Joint targeted area inspection – response to unborn children and children aged 0 to 7 years who are victims of domestic abuse (Ofsted/CQC/HMIC/HMIP) |
|
|
SEND
May 2024 |
Area SEND inspection of North Yorkshire Local Area Partnership (Ofsted/CQC) |
The local area partnership’s arrangements lead to inconsistent experiences and outcomes for children and young people with special educational needs and/or disabilities (SEND). The local area partnership must work jointly to make improvements.
This was the middle of three potential outcomes. |
|
Adult Learning and Skills Service
February 2023/ May 2025 |
Further education and skills inspection report (Ofsted) |
Good in 6 out of 7 domains. Requires improvement in overall effectiveness.
Full re-inspection in May 2025 – awaiting publication. |
|
Children’s Services
Various |
Inspection of Children’s Homes and Children’s Resource Centres |
Good in four out of five establishments. Requires Improvement in one children’s home. |
3.10 In the reporting period between the June 2024 CYPS report on Internal Governance issues and this report, Internal Audit have reported on nine audits specifically related to Children and Young People’s Service. Whilst the reports have identified some improvements, management actions to address those points have been developed. In agreement with Internal Audit colleagues, the directorate arranged for thematic audits to be undertaken across local authority maintained schools as well as risk-based individual school audits. In the last year, thematic audits have included: ring-fenced funding and business continuity. Thematic audits typically involve multiple schools on specific issues enabling a broader cross-section of schools to be included in audit testing than would be the case in a simple rolling cycle of individual full school audits.
DIRECTORATE RISK REGISTER AND INTERNAL CONTROL FRAMEWORK
3.11 The Directorate Risk Register (DRR) is the end product of a systematic process that initially identifies risk at Service Unit level and then aggregates these via a sieving process to Directorate level. A similar process sieves Directorate level risks into the Corporate Risk Register. The DRR is presented and approved and at the Children and Young People’s Leadership Team meeting.
3.12 The Risk Prioritisation System uses a 5x5 risk assessment ranging from very low to very high in terms of both likelihood and impact: once the likelihood and impact for a risk have been assessed, the risk scoring is calculated. The following table shows the scoring, assessment and suggested required actions:
|
Colour |
Score |
Assessment |
Required Action |
|
|
1 – 2 |
Very Low (tolerate) |
Risk should not appear in risk register. |
|
|
3 – 4 |
Low (tolerate) |
Regular monitoring, action plan not essential, acceptable just to maintain current controls. |
|
|
5 – 9 |
Medium (treat) |
Frequent monitoring, action plan required. |
|
|
10-12 |
Medium High (treat) |
Frequent monitoring, action plan required to prevent from becoming a red risk. |
|
|
15 – 16 |
High (treat) |
Constant monitoring, action plan required and escalation to next level for consideration / inclusion. |
|
|
20 – 25 |
Very High (treat / terminate) |
Constant monitoring, action plan required and escalation to next level with request for inclusion. Consider terminating activity (if an option) where score cannot be reduced by risk mitigation. |
The DRR represents the principal risks that may materially impact on the performance and financial outcomes of the Directorate. The detailed DRR is shown at Appendix A and shows a range of risks, and the risk reduction actions which have been put in place to minimise them. A summary of the DRR is also attached at Appendix B.
3.13 Some of the key risk issues for the Directorate are summarised below:
(a) SEND and High Needs
The directorate’s financial position has been driven by sustained rising demand for services and uncertainty over national reforms. Throughout 2024/25, we have refreshed the High Needs programme to identify mitigating actions to reduce the financial pressure. The SEND Partnership Board provides a multi-agency forum to deliver the SEND Strategy. The CYPS Programme Board monitors the High Needs transformation plan and regular updates on high needs funding issues are reported to the North Yorkshire Schools Forum and the High Needs Funding sub-group of the Schools Forum.
The local authority has continued to make prudent provision through a ‘mirror-reserve’ for the cumulative Dedicated Schools Grant High Needs Block overspend. The statutory override is due to expire by March 2026 and the directorate, alongside most other local authorities, awaits the Government’s proposals around SEND reform, LA financial deficits and the statutory override. At the point this paper was published, the unsustainable national funding provision for SEND represents one of the key financial risks to the Council’s medium-term sustainability.
(b) Social Care – caseload management remains a key priority for the directorate to ensure a quality Strengths in Relationships practice model. However, demand has increased particularly around caring for children with a complexity of health and social care needs. Supply-side factors, in a saturated market, have resulted in significant price pressures. Further development of internal accommodation is planned to help address demand and affordability challenges.
(c) School Funding – as at 1st May 2025, nine local authority maintained schools are subject to a Notice of Financial Concern. With a tight funding settlement for 2025-26, the local authority will continue to support, challenge and, where necessary, intervene to ensure that schools continue to remain financial sustainable.
(d) Capital Funding – building and/or expanding school provision in areas of need has been undertaken aimed at mitigating pressures, particularly around sufficiency and school place planning and SEND. Challenges exist to balance plans for new capital developments with limited availability of funding, condition of the school estate and rising costs.
4.0 FINANCIAL IMPLICATIONS
4.1 There are no direct financial implications as a result of this report.
5.0 LEGAL IMPLICATIONS
5.1 There are no direct legal implications as a result of this report.
6.0 EQUALITIES IMPLICATIONS
6.1 There are no direct equalities implications as a result of this report.
7.0 CLIMATE CHANGE IMPLICATIONS
7.1 There are no direct climate change implications as a result of this report.
8.0 REASONS FOR RECOMMENDATIONS
8.1 This report has highlighted a number of existing sources of assurance that help to determine the effectiveness of governance arrangements in practical terms. The review concludes that:
- the directorate has not experienced any major governance failures during the last year.
- the Risk Register has been working well and senior managers have actively engaged with the detailed review.
- Internal Audit have undertaken a number of reviews to provide assurance. Although improvements have been identified in some areas, these are not regarded as significant.
- There are no major gaps or weaknesses identified when considering the outcomes and practical implementation of the North Yorkshire Local Code of Corporate Governance
8.2 This high-level review concludes that the governance arrangements operating in the Directorate over the last year have met the Council’s expected principles of good governance, as set out in the Council’s local code of governance.
APPENDICES:
Appendix A – Directorate Risk Register – Detailed
Appendix B – Directorate Risk Register – Summary
BACKGROUND DOCUMENTS:
None
Sir Stuart Carlton
Corporate Director – Children and Young People’s Services
County Hall
Northallerton
23rd June 2025
Report Author – Howard Emmett, Assistant Director – Resources
Presenter of Report - Howard Emmett, Assistant Director - Resources