Contact your Parish Council
Policy and Resources Committee Risk Update – June 2020
Corporate Risks
The Council’s corporate risks are those risks which could impede the achievement of our strategic objectives. The corporate risk register was last reported to Members in April 2019, following a workshop of senior officers and Members to reconsider the corporate risks following approval of the new Strategic Plan.
The matrices below provide a snapshot of the corporate risk profile, with the location on the matrix being dependent on the score of risk likelihood and impact. This is based on the current risk, i.e. the risk impact and likelihood (as defined in Appendix 1C) considering any existing controls in place to manage the risk, but before any further planned controls are introduced. For a base comparison we have included the profile from the previous risk update:
|
|
Risk Profile – April 2019 |
|||||||
|
|
Likelihood |
5 |
|
|
1 |
|
||
|
|
4 |
|
3 |
|||||
|
|
3 |
|
2 |
4 |
||||
|
|
2 |
1 |
1 |
1 |
||||
|
|
1 |
|
|
|||||
|
|
|
|
1 |
2 |
3 |
4 |
5 |
|
|
|
|
|
Impact |
|||||
|
|
Risk Profile – June 2020 |
|
||||||||
|
Likelihood |
5 |
|
|
1 |
1 |
|
|||
|
4 |
|
1 |
2 |
1 |
|
||||
|
3 |
|
2 |
6 |
1 |
|
||||
|
2 |
1 |
1 |
|
||||||
|
1 |
|
|
|
||||||
|
|
|
1 |
2 |
3 |
4 |
5 |
|
||
|
|
|
Impact |
|
||||||
The overall risk environment has significantly worsened since April 2019. However, within this overall position there are some risks that have been mitigated successfully, such as poor partner relationships. There are other risks that have become more severe. Contraction in retail and leisure was already highlighted as a risk in April 2019; the position of this sector has clearly deteriorated significantly as a result of the Covid-19 pandemic. Finally, two new risks have been identified arising directly from the Covid-19 pandemic.
Further detail on the corporate risks, including a description of the risk and details of existing and planned key controls can be found in Appendix 1A.
Operational Risks
All Council services maintain an operational risk register, including Shared Services. Operational risks are the responsibility of the services to manage, and so fall within the remit of our Managers and Heads of Service. The following matrix shows the operational risk profile for the Council. This is based on the current risk, i.e. the risk impact and likelihood (as defined in Appendix 1C) considering any existing controls in place to manage the risk, but before any further planned controls are introduced. The table shows the number of risks for each colour category.
These risks are managed in accordance with the Council’s Risk Appetite Statement, whereby services routinely monitor their risks based on the risk score. BLACK risks are monitored monthly by CLT and RED quarterly. Services monitor AMBER risks 6-monthly and Green / Blue risks annually or as needed.
Quarterly risk updates are presented to Corporate Leadership Team (CLT) on all risks above the Councils appetite – i.e. those risks which are RED or BLACK. Appendix 1B provides a one-page summary of the overall risk process.
The BLACK risk relates to infrastructure improvements which could fail to take place due to a lack of investment or change to government priorities. This is monitored by CLT through routine update reports. Should the circumstances for an existing risk change such that the score is increased into BLACK this will be escalated to CLT and a decision made as to any further action needed and how the risk is best monitored. Monitoring of these high level risks enables more effective challenge on the effectiveness of controls, and also means that support can be put in place to help manage the impact of the risk.
Next Steps
The Covid-19 pandemic demonstrates dramatically the importance of absorbing new information about risk and reflecting this in our approach. Whilst the UK has not yet fully emerged from the pandemic, there are a number of lessons that may be drawn from it.
- There is a category of risks (eg global warming, pandemics) which can be foreseen in broad terms, but where the timing and nature of their impact is completely uncertain. In the past, this has deterred many organisations from considering them seriously in day-to-day risk management.
- Responsibility for this category of risks cannot be attributed to any other organisation, or indeed any other nation, given that they are so wide-ranging (in geographic, human and economic terms) in their impact. That means that no organisation can pass responsibility for the risk on to a third party, eg by arguing that the other party has legal responsibility.
- Pandemics are relatively rare in historical terms (the last pandemic to have an impact in the UK on a similar scale to the current one occurred in 1918). They could therefore be treated as ‘very low probability, very high impact’ in risk management terms. However, the scale of the impact means that they cannot be ignored, even though the probability is low. (There is a separate argument that the frequency of pandemics is actually likely to increase in future, such that they are not in fact ‘once in a century’ occurrences).
Arising from these points, it is proposed to introduce a new risk to the register:
- Major catastrophe with national / international impact (eg new pandemic, environmental disaster, nuclear attack)
Additionally, the likely duration of the current Covid-19 pandemic itself remains uncertain. Whilst the number of cases is reducing, there remains a risk of its resurgence, for example through inadequate counter-measures or a mutation in the virus itself. This is therefore reflected in the follow further proposed new risk:
- Resurgence of current Covid-19 pandemic.
Risk management is a continuous process, and we will continue to build on and improve the arrangements to further strengthen the risk management process and develop a positive risk culture across the Council. Internal Audit continues to receive a positive level of engagement and support from Senior Officers and Managers in the Council which has enabled the risk management process to develop and embed.
Appendix 1A
Corporate Risks [TO BE UPDATED BY RISK OWNERS]
The table below sets out each of the corporate risks in detail. Risk owners have assessed the impact and likelihood of the risks and identified the key controls and planned actions necessary to further manage the risk to an acceptable level:
|
Risk (title & full description) |
Risk Owner |
Key Existing Controls |
Current rating ( I x L) |
Controls planned |
Mitigated rating ( I x L) |
|
Major emergency with national / international impact (eg new pandemic, environmental disaster, nuclear attack) |
Alison Broom |
(1) Strong existing emergency planning framework (2) Active engagement with Local Resilience Forum (3) Flexible and committed workforce (4) Some financial reserves (5) Good partnership working as demonstrated during Covid-19 pandemic |
(5 x 3) |
(1) More structured approach to review of horizon for early warnings (2) Plan for dealing with major emergencies (3) Higher level of financial reserves
|
(5 x 3) |
|
Resurgence of current Covid-19 pandemic |
Alison Broom |
(1) Strong existing business continuity planning arrangements (2) Active engagement with Local Resilience Forum (3) Learning from current pandemic has been captured (4) Member consultative forum on recovery arrangements (5) Risk assessments in place for all Council buildings
|
(5 x 4) |
(1) Build up stocks of appropriate equipment (2) Further develop emergency plans |
(4 x 4) |
|
Increased effects from climate
change or reduction in air quality causes environmental damage |
Angela Woodhouse |
(1)
Air Quality Action Plan in place (4) Budget available to deliver actions (5) Member working group (6) Communication / engagement strategy for adverse weather events |
(4 x 4) |
(1) Recruit permanent Biodiversity and Climate Change officer (2) Climate change action plan (including response to severe weather) to be taken to P&R in September 2020 (3) Review by Carbon Trust towards the Council becoming carbon neutral by 2030 |
(4 x 4) |
|
Conflicting expectations or limited engagement leads to poor partner relationships inhibiting the Council's ability to call on others to help achieve its corporate objectives |
Alison Broom |
(1)
Regular liaison meetings (e.g. Kent Association for Local Councils) (6) Participation in integrated care partnership board |
(4 x 4) |
(1) Increased joint work
with KCC highways & waste teams |
(4 x 3) |
|
General financial downturns, unexpected changes to government funding or failure to achieve income or savings targets places further financial restrictions on the Council resulting in difficulty maintaining standards or meeting aims. |
Mark Green |
(1) Agreed work programmes in transformation and commissioning (2) Budget monitoring in place (3) MTFS in place and monitored (4) Scenario planning in budget setting (5) Financial independence strategy to maximise our income (6) Strategies for maintaining income (e.g. pricing policies and purchase of Lockmeadow) (7) Commercial investment strategy (8) Holding reserves to mitigate impact of financial restrictions |
(4 x 5) |
(1) Lobbying to avoid unfavourable financial changes to government funding (2) Aligning MTFS & strategic plan (3) Cost recovery through bidding for additional government support for one-off costs (e.g. Brexit) (4) Further commercial investment being explored |
(4 x 4) |
|
Security breach or system weakness leading to IT security failure results in system unavailability and increased legal and financial liability. |
Steve McGinnes |
(1) Regular backup
programmes |
(4 x 3) |
(1) Cyber awareness campaign
underway |
(4 x 3) |
|
Poor engagement and communications leads to loss of community engagement limiting support for project delivery and regard for public realm. |
Alison Broom |
(1) Regular communications & engagement |
(3 x 4) |
(1) Member training & awareness (2) More targeted public engagement, including more prominent engagement for Local Plan
|
(2 x 3) |
|
The broader housing crisis leads to housing pressures increasing on the Council, affecting both costs associated with homelessness and ability to meet wider housing needs in the borough. |
William Cornall |
(1) Homelessness
prevention team in place with increased resource |
(4 x 3) |
(1)
Closer
working with voluntary sector (5) Seeking to acquire a hostel type facility to assist with TA and move-on provision. (6) Consider purchasing more housebuilder stock off plan. |
(3 x 3) |
|
Insufficient awareness / expertise leads to not fulfilling residential property responsibilities resulting in possible health & safety breaches. |
William Cornall |
(1) Faithfull Farrell & Timms have been retained as a critical friend to allow the new housing management function to up skill. (2) West Kent Housing Association (WKHA) engaged to provide an asset management service for the whole MBC residential portfolio. (3) The whole MBC residential portfolio is now being managed by a single team within Housing & Communities, where previously it was split between Housing & Property. (4) H&S KPI’s are now recorded and reported through an interim software solution, FIXFLO. (5) The H&S KPI’s are reported monthly to Corporate Leadership Team. |
(4 x 3) |
(1) Further consideration of the creation of a separate housing management team, to sit aside from the Homelessness service creating client / contractor separation. (2) A permanent replacement housing management software package is being procured and this will incorporate KPI production and management. This will take over from the previous system, and the interim system (FIXFLO). (3) Mid Kent Audit Team have been commissioned to give advice around data integrity in respect of KPI production and reporting. (4) Eventual goal of real time reporting in terms of gas safety, via the WKHA contractor. |
(3 x 3) |
|
Lack of capacity,
capability or planning results in major project failure damaging the
Council's |
William Cornall |
(1)
Engage
external consultants where needed on complex projects (10) Regeneration & Economic Development staffing structure amended to increase focus on project identification & delivery. |
(4 x 3) |
(1) Regeneration projects board to be set up (2) Increased financial checks around potential contractor financial strength.
|
(4 x 2) |
|
General and localised economic pressure leads to contraction in retail & leisure sectors, limiting the appeal of Maidstone town centre threatening social cohesion and business rates income. |
William Cornall |
(1) Town
Centre strategic advisory board (7) Active management of Lockmeadow to increase the local economy |
(5 x 5) |
(1) Exploring town centre shop fronts
improvement grant scheme (3) Working wit Key stakeholders including One Maidstone to safely reopen the High Street. (4) Consider a targeted programme of place promotion campaign activities |
(4 x 5) |
|
Poor management of contracts or financial resilience of contractors leads to significant contract failure disrupting services and creating extra liabilities. |
Mark Green |
(1)
Contract management approach in
place (6) Regular updates to senior management and CLT |
(4 x 3) |
(1) Review of existing contracts |
(3 x 2) |
|
Failure in implementation of Local Plan leads to building of incomplete communities in the borough inhibiting residents' quality of life |
William Cornall |
(1) Communication &
liaison with partners |
(3 x 3) |
(1) A revised Local Development Scheme will be taken to SPI in Spring 2020. (2) Findings of Reg 18a consultation to be published during Q1 of 2020/21 (3) Continue to lobby government on 5 year land supply and Housing Delivery Test concessions. |
(3 x 3) |
|
Exit of EU on unfavourable terms results in adverse short-term Brexit impacts disrupting the Council's ability to offer services and increasing liabilities. |
Mark Green |
|
(4 x 3) |
(1) Continued liaison with partners (2) Government funding to mitigate impacts (3) Liaison with local business about the support that could be provided |
(3 x 3) |
|
Increased pressure on controls leads to governance failures resulting in poor decision making and increased legal liability |
Alison Broom |
(1) Constitutional
review |
(4 x 2) |
|
(4 x 2) |
|
Due to difficulties in
recruitment, retention or managing absence the Council has insufficient |
Steve McGinnes |
(1) Workforce strategy
monitoring & reporting |
(2 x 2) |
(1) Implementation of actions from
engagement surveys and pulse surveys |
(2 x 2) |
|
Insufficient awareness / expertise leads to not fulfilling commercial property responsibilities |
Mark Green |
(1) Expert advice on compliance (2) Regular monitoring by CLT of corporate property PIs |
(4 x 2) |
(1) Implementation of new Corporate Property systems |
(3 x 2) |
Appendix 1B
Maidstone Risk Management Process: One Page Summary
Appendix 1C
Impact & Likelihood Scales
Risk Impact
Risk Likelihood
