Appendix 3
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Risk Management Framework
Effective risk management is a vital part of the Council’s governance, and contributes greatly to the successful delivery of services and key priorities. The Council has always recognised and supported the need to have effective processes to identify, evaluate and manage risks. The processes followed by the Council to manage risk are set out in Appendix 3B.
Risk is defined in terms of its impact and likelihood. The way in which these are measured is set out Appendix 3C.
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.
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 June 2020. Owing to the increased focus on risk arising from the Covid-19 pandemic, members have asked that details of the corporate risk register be reported on an ongoing quarterly basis, to coincide with the regular budget and performance monitoring reports received by Policy and Resources Committee.
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 3C) 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:
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Risk Profile – June 2020 |
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Likelihood |
5 |
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1 |
1 |
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4 |
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1 |
2 |
1 |
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3 |
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2 |
6 |
1 |
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2 |
1 |
1 |
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1 |
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1 |
2 |
3 |
4 |
5 |
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Impact |
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Risk Profile – September 2020 |
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Likelihood |
5 |
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1 |
1 |
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4 |
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1 |
2 |
1 |
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3 |
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2 |
6 |
1 |
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2 |
1 |
1 |
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1 |
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1 |
2 |
3 |
4 |
5 |
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Impact |
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The table below lists risks in rank order of their scores and shows changes between June and September.
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Risk |
Score before mitigation |
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June |
Sept |
Change |
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Contraction in retail & leisure sectors |
25 |
25 |
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Financial restrictions |
20 |
20 |
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Resurgence of current Covid-19 pandemic |
20 |
20 |
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Environmental damage |
16 |
16 |
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Adverse short-term Brexit impacts |
12 |
16 |
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Major unforeseen emergency |
15 |
15 |
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Poor partner relationships |
16 |
12 |
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Housing pressures increasing |
12 |
12 |
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IT security failure |
12 |
12 |
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Loss of community engagement |
12 |
12 |
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Major project failure |
12 |
12 |
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Not fulfilling residential property responsibilities |
12 |
12 |
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Significant contract failure |
12 |
12 |
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Building of incomplete communities |
9 |
9 |
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Governance failures |
8 |
8 |
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Not fulfilling commercial property responsibilities |
8 |
8 |
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Insufficient workforce capacity & skills |
4 |
4 |
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The overall risk environment in June 2020 had significantly worsened since the previous report. Contraction in retail and leisure had already been highlighted as a risk; the position of this sector deteriorated significantly as a result of the Covid-19 pandemic. Finally, two new risks were identified arising directly from the Covid-19 pandemic, namely (a) Major unforeseen emergency and (b) Resurgence of current Covid-19 pandemic.
The key changes since June 2020 have been as follows.
- Reviewing our work with partners during the Covid-19 response phase shows that we have strong relationships already and were able to build new ones. We hope to formalise this so that these relationships are embedded and allow us better to respond to any future challenges.
- Current indications are that the risk of a disruptive exit from existing EU trade arrangements is becoming more severe.
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 3A.
Appendix 3A
Corporate Risks
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) |
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Major unforeseen emergency with national / international impact (eg new pandemic, environmental disaster) |
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) |
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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 (6) Plans in place to enable staff to return to work safely
|
(5 x
4) |
(1) Continuing engagement with local public health officers to ensure rapid response (2) Build up stocks of appropriate equipment (3) Further develop emergency plans |
(4 x
4) |
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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 (7) Biodiversity and Climate Change officer in post |
(4 x
4) |
(1) Climate change action plan (including response to severe weather) to be taken to P&R in October 2020 (2) Review by Carbon Trust towards the Council becoming carbon neutral by 2030 |
(4 x
4) |
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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) (1) Joint working with other local authorities, parishes and voluntary sector during Covid-19 response (2) (2) Regular liaison meetings (e.g. Kent Association for Local Councils) (3)
(3) Defined joint working arrangements (e.g. Mid Kent Shared
services, waste, licensing) |
(4 X 3) |
(1) Measures to embed relationships built during Covid-19 response (2)
Increased joint work with KCC highways & waste teams
|
(4 x
2) |
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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) Currently updating MTFS to reflect impact of Covid-19 and need to support recovery (2) Review of reserves policy as part of MTFS development (3) Lobbying to avoid unfavourable financial changes to government funding (4) Cost recovery through bidding for additional government support for one-off costs (e.g. Brexit)
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(4 x
4) |
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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) |
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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) |
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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) Purchase of more housebuilder stock off plan. |
(3 x
3) |
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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) 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). (2) Mid Kent Audit Team have been commissioned to give advice around data integrity in respect of KPI production and reporting. (3) Eventual goal of real time reporting in terms of gas safety, via the WKHA contractor. |
(3 x
3) |
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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 |
(4 x
3) |
(1) Continue development of an expert in-house project management team to act as the client for major project delivery (2) Increased financial checks around potential contractor financial strength.
|
(4 x
2) |
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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) Working with
Key stakeholders including One Maidstone to safely reopen the High Street. |
(5 x
5) |
|
(4 x
5) |
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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) Continue with Local Plan Review process (2) Lobby government on 5 year land supply and future legislative proposals |
(3 x
3) |
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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
4) |
(1) Continued liaison with partners (2) More frequent updates in approach to 31.12.20 (3) Liaison with local business about the support that could be provided |
(3 x
4) |
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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) |
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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) |
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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 3B
Maidstone Risk Management Process: One Page Summary
Appendix 3C
Impact & Likelihood Scales
Risk Impact
Risk Likelihood
