Decision details

Quarterly update of Corporate Risks

The Senior Finance Officer (Risk & Insurance) presented a report on the quarterly update of the Corporate Risk Register.

The Senior Finance Officer reported that the Corporate Risk Register had been considered by both the Risk Management Group on 25 September and the Corporate Governance Group on 10 October 2012. These reviews had indentified some amendments to existing risks on the Corporate Risk Register, but no new risks had been identified. Two risks had been proposed for deletion:

(i)         Risk 16 – Performance Management, as it was felt that this was now sufficiently embedded within the Council; and

(ii)        Risk 31 - London 2012 Olympic Disruption, as the Olympics had now finished.

A further three risks had been proposed for amendment:

(i)         Risk 33 – Reform of Housing Revenue Account, one of the triggers, CLG ignores representation, had been removed;

(ii)        Risk 35 – Budget Reductions, the wording within the Vulnerability had been amended to reflect the requirements of the Medium Term Financial Strategy; and

(iii)       Risk 15 – Sickness Absence, the rating had been reduced from a score of C3 (Significant Likelihood/Marginal Impact) to a score of D3 (Low Likelihood/Marginal Impact).

The Cabinet Committee was requested to consider the revised Corporate Risk Register and whether the tolerance line on the Risk Matrix should be amended.

In response to questions from members of the Cabinet Committee, the Director of Finance & ICT stated that the Triggers and Consequences for Risk 34, Changes to the Benefit System, had incorporated the wider impact of Welfare Reform, and the Action Plan could be revised to incorporate any further wider aspects. The suggested rating of B2 (High Likelihood, Critical Impact) for Risk 3, Potential Difficulty producing the Local Plan to the Timetable, was felt appropriate at the current time. The Cabinet Committee was reminded that the Corporate Risk Register was reviewed every three months. Risk 23, Fraud including Bribery, covered any potential impact from staff transferring to the Department of Work and Pensions to create a single Fraud Investigation body. A number of options were still being considered by the Government but the staff affected were remaining with the Council for the time being. It was the standard methodology employed by the Council’s insurer, Zurich Municipal, to have only four categories for the impact rating of each risk; it was accepted that no risk currently had a rating of either 1 (Catastrophic) or 4 (Negligible).

The Portfolio Holder for Safer, Greener & Highways inquired whether the C2 rating (Significant Likelihood/Critical Impact) for Risk 8, Business Continuity Management, suggested that measures to improve the Council’s resilience for Disaster Recovery should have a higher priority than replacing the current telephony system, or whether the rating for this Risk should have a lower likelihood and a higher impact. The Director of Finance & ICT stated that this Risk encompassed all possible Business Continuity events, not just IT related incidents. It was still intended to establish a recovery site of back-up servers at Parsonage Court, but the current telephony system was at the end of its useful life and urgently required replacement. The Chairman added that residents relied heavily on contacting the Council via the telephone, and it was getting increasingly difficult to acquire spares for and maintain the current system. Hence, its replacement had been accorded a higher priority.

Recommended:

1.         That Risk 16, Performance Management, be deleted;

2.         That Risk 31, London 2012 Olympic Disruption, be deleted;

3.         That Risk 33, Reform of Housing Revenue Account , be amended to remove the trigger ‘CLG ignores representation’;

4.         That the Vulnerability for Risk 35, Budget reductions,  be amended to reflect the requirements of the current Medium Term Financial Strategy;

5.         That the rating for Risk 15, Sickness Absence, be reduced to a score of D3 (Low Likelihood/Marginal Impact);

6.         That the current tolerance line on the risk matrix be considered satisfactory and not be amended; and

7.         That, incorporating the above agreed changes, the amended Corporate Risk Register be approved.

Reasons for Proposed Decision:

It was essential that the Corporate Risk Register was regularly reviewed and kept up to date.

Other Options Considered and Rejected:

To suggest new risks for inclusion or amendments to the scoring of existing risks.