Agenda Item No 8
The Vale of Glamorgan Council
Audit Committee 18 November 2014
Report of the Corporate Risk Management Group
Risk Management- Corporate Risk Register Review
Purpose of the Report
1. To update the Audit Committee with the current position of the Corporate Risk Register.
That Audit Committee note the current position and key developments in relation to corporate risks.
Reasons for the Recommendation
1. To highlight the amendments made to the Corporate Risk Register and the current position of corporate risks for the Council.
2. To ensure that all corporate risks for the Council are effectively monitored, addressed, reviewed and updated on a regular basis.
2. The Corporate Risk Management Group (CRMG) meet on a quarterly basis to review the Risk Register to consider the position of each corporate risk identified. The group evaluates whether there have been any changes in either the internal or external environment as well as any new mitigating controls that are being put in place that would prompt a re-evaluation of the risk in terms of its score/position.
3. A report on the Corporate Risk Register was last presented to CMT on the 16th April 2014 and subsequently reported to Audit Committee on the 28th April 2014.
4. The key recommendations made by CMT included:
That the Head of Human Resources be consulted as to whether the Job Evaluation risk still merited a position on the Risk Register.
That the Head of Human Resources ensures that the Workforce Needs risk adequately reflects issues around the recruitment of specific skills and succession planning in light of the William's Commission.
The score of the School Investment Strategy risk be increased from a 6 (Medium to a 9 (Medium/High) in light of funding complexities.
That a risk in relation to Corporate Safeguarding be added to the register.
5. These recommendations have now been actioned or are being progressed.
Relevant Issues and Options
6. There are currently 12 risks included in the Corporate Risk Register. Each of these risks was reviewed by CRMG on the 28th October. Of the 12 risks, 10 risks remained unchanged (kept the same score) and just one risk decreased in relation to the job evaluation risk. The CRMG agreed that the job evaluation risk would be removed from the Risk Register.
7. A report providing an update on the status of risks within the current Risk Register was endorsed by CMT on 5th November 2014. At this meeting, CMT felt that the climate change risk has significantly reduced on the basis that the risks associated with it are being effectively controlled through a range of current controls and counter measures. CMT recommended that the risk should be scored as low and hence removed from the Risk Register.
8. Although, the majority of risks have remained relatively static, some risks have been forecast to move in an upward or downward direction based on the circumstances/issues known to be on the horizon. It is forecast that the waste management risk will continue to move in a downward direction, as a result of the implementation of the new Veridor waste management energy plan. It is anticipated that the risk associated with fines will be significantly diminished. Equally the funding risk has been forecast to decrease over time. However, it is anticipated that the work force needs risk will increase over time as a result of the reshaping services agenda and factors associated with the proposed merging of local authorities. CRMG have recommended that the Risk Register template is amended to capture any horizon scanning of risks in order to forecast whether a risk is likely to move in an upward or downward direction in the future.
9. Appendix 1 outlines each corporate risk aligned by risk theme and owner and identifies the current risk score and the corresponding direction of travel (if the score has increased/decreased or stayed the same). For each corporate risk, an update has been provided in relation to any key changes, developments in relation to the risk and its mitigating actions (current controls and counter measures).
10. The CRMG identified that there is the need to adapt the current risk register to not only identify if a risk is currently increasing/decreasing/staying the same (in terms of direction of travel), but also to forecast whether the direction of travel is likely to change in the future. This will enable the group to forecast for each risk whether the risk is likely to increase/decrease in light of any knowledge of future internal external factors that are on the horizon even if overall the risk currently could remain static. This would feature as an additional column in the Risk Register as 'forecasted direction of travel'.
11. The CRMG discussed three new emerging corporate risks that include the safeguarding risk, the deprivation of liberties risk and the public buildings corporate compliance risk. CRMG have agreed that each of these risks will be considered by the group in more detail at its next meeting to evaluate whether they should be identified as either corporate or service level risks.
12. For the safeguarding risk, the CRMG identified the need to undertake an assessment of this risk to identify its current risk status in the Risk Register. This risk template is currently being completed by the Head of Business Management and Innovation in consultation with the Director of Social Services.
13. CRMG identified public buildings compliance as a new and emerging corporate risk. The CRMG noted cases where corporate responsibility has been placed on both public bodies and individuals for any incidences that were the result of non-compliance with current public building regulations. CRMG identified that this presents a significant corporate risk to the Council in light of there currently being no Corporate Compliance Officer in post. The group felt that this risk merits inclusion in the register and should currently be ranked medium/high with an overall score of 9. The risk template is currently being completed by the Operational Manager for Property in consultation with the Head of Finance and will be considered at the next CRMG meeting.
14. The risk associated with deprivation of liberties was identified by the CRMG as a potential corporate risk. A recent Supreme Court ruling defined Deprivation of Liberty when 'the person is under continuous supervision and control and is not free to leave, and the person lacks capacity to consent to these arrangements'. There are instances where deprivation of liberty becomes necessary and should therefore be authorised. There are safeguarding processes in place that public bodies should follow in order to assess whether deprivation of liberties should apply.
15. In March 2014, the Supreme Court extended the protection regarding the Mental Capacity Act 2005 and the Deprivation of Liberty Safeguards 2009 to a wider population of people that are being cared for in care homes, hospitals, and within their own homes. A recent Scrutiny Committee report highlighted the key implications associated with this Supreme Court ruling and identified that this change has substantially increased the number of people who will require protection of the Deprivation of Liberty Safeguards or the Court of Protection. The Scrutiny report highlighted that since the Supreme Court ruling the number of requests for authorisations (for Deprivation of Liberty) has risen significantly from 12 requests in June 2013 to 224 in June 2014 The risk this presents to the Council is the failure to apply the deprivation of liberty safeguards appropriately in line with the Mental Health Capacity Act 2005 and the Deprivation of Liberty Safeguards 2009. The implications of this for the Council would be significant in terms of potential litigation, fines and or reputational damage. There is also the risk associated with the cost of implementation. The Scrutiny report identified that the additional cost of commissioning resource was considerable and that it is estimated that the total recurrent cost to the Vale of Glamorgan is likely to be £236,340. The CRMG identified the need to undertake an assessment of this risk to identify its current risk status and whether it merits a position within the Risk Register and be discussed at the next CRMG meeting.
Resource Implications (Financial and Employment)
16. Managing and reducing risks effectively helps prevent unnecessary expenditure for the Council, reduces insurance claims and premiums and provides better protection for the Council and its staff and members.
Sustainability and Climate Change Implications
17. Sustainability has been identified as one of 12 risk themes that are used to assess the nature of a risk and their potential effect. Nine of the twelve corporate risks have identified sustainability as a key theme. Counter measures and controls to mitigate against any sustainability related risks are outlined in each risk template in the Risk Register and monitored by the Corporate Risk Management Group.
18. Climate change has been identified as a medium level corporate risk to the Council and is being monitored as part of the Corporate Risk Register.
Legal Implications (to Include Human Rights Implications)
19. Identifying, managing and reducing risk effectively helps to prevent legal challenge.
Crime and Disorder Implications
20. None directly at present.
Equal Opportunities Implications (to include Welsh Language issues)
21. Equalities has been identified as one of twelve risk themes that are used to assess the nature of a risk and their potential effect. Six of the twelve corporate risks have identified equalities as a key theme. Counter measures and controls to mitigate against any equalities related risks are outlined in each risk template in the Risk Register and monitored by the Corporate Risk Management Group.
22. Risk management is an intrinsic part of corporate governance that is embodied within the principle of community leadership. It is a key competency for the Council to demonstrate as part of the Wale Programme for Improvement. Effective risk management assists the Council in managing its assets more efficiently and thereby promotes the achievement of the Council's objectives in relation to community leadership.
Policy Framework and Budget
23. This is a matter for executive decision.
Consultation (including Ward Member Consultation)
24. Consultation has taken place with nominated risk owners and members of the Corporate Risk Management Group.
Relevant Scrutiny Committee
25. Corporate Resources
Corporate Risk Register
Deprivation of Liberty Safeguards Report, Social Care and Health Scrutiny Committee, 14th July 2014.
Alan Jenkins, Head of Finance (Chair of the Corporate Risk Management Group).
Improvement and Development Team
Corporate Risk Management Group
Sian Davies, Managing Director