Agenda item

The Strategic Risk Assessment for 2016 for Monmouthshire County Council was presented.

Key Issues

1.         The risk assessment ensures that:

·         Strategic risks are identified and monitored by the authority.

·         Risk controls are appropriate and proportionate

·         Senior managers and elected members systematically review the strategic risks facing the authority.

2.         The existing risks on the Strategic Risk Assessment have been updated based on evidence available in 2016, as presented at Appendix 1.   Changes to the council’s risk management policy were approved by Cabinet in March 2015 and continue to be applied to the strategic risk register.  These are:

·         including pre-mitigation and post-mitigation risk scores, this was also a key recommendation from scrutiny of the 2014 risk assessment

·         ensuring greater clarity to the phrasing of risk so that each statement includes an event, cause and effect as shown below:

 3.     The risk assessment only covers high and medium level risks.  Lower level operational risks are not registered unless they are projected to escalate within the three years covered.  These need to be managed and monitored through teams’ service plans. The pre and post mitigation risk levels are presented separately. In most cases mitigating actions result in a change to the likelihood of the risk rather than the consequences as our actions are generally aimed at reducing the chance of a negative event occurring rather than lessening it’s impact.  Clearly there will be exceptions.

4.     Following presentation to select committees and audit committee, the risk assessment will be presented to Cabinet for sign off. The risk assessment is a living document and will evolve over the course of the year as new information comes to light. An up-to-date risk log is accessible to members on the Council’s intranet - The Hub.  This will ensure, as well as the ongoing specific scrutiny of the risk assessment annually, that select committees are able to re-visit the information at any point in the year to re-prioritise their work plan as appropriate.

Members’ attention was drawn to two risks pertinent to the Committee. 

Risk No. 4 refers to the potential risk that the Council does not make sufficient progress in areas of weakness identified by regulators leading to underperformance.  It was explained that this risk was discussed earlier in the meeting and is covered in the WAO proposals paper.  During discussion answers and assurances were

given regarding the detail of the proposals. The risk is therefore recorded with the reason for its inclusion, a score indicating the likelihood of the risk occurring, mitigating and future actions, and a post-mitigation score.

Risk No. 9b refers to a potential risk that the Council did not having appropriate governance mechanisms when establishing new collaborative or alternative delivery models that are often complex and could impact on the shared ability to deliver objectives.  This is common to other Councils currently.  Whilst this matter has been included in the WAO proposals, members were invited to comment further.

A Member questioned the risk management process (para 2.2) and the assertion of the systematic challenge of Cabinet Members and Officers.  It was agreed that this was a valid observation.  It was confirmed that such challenge is the remit of Audit committee and also Select committees where it is suggested that the risk assessment is used as a basis for their work plan. Members were informed that the Risk Assessment document is continuously available on the Hub and updated as new information is available.  Committees may consider the document or any risk at any point during the year.

A Member commented that the risks identified appear every year.  It was confirmed that there is degree of consistency, however mitigating actions can alter the risk score.  It was queried if a risk assessment item was lowered if it would it leave the list.  It was explained that there is a matrix of high and medium level risks and lower level risks sit within team service plans, and managed at that level accordingly. The attention of Cabinet and Select Committees is drawn to risks pertinent to them, and the status and effect of mitigating actions accordingly.

A Member questioned Risk No. 11 in relation to Britain leaving the European Union and how any disadvantage can be overcome e.g. City Deal.  It was commented that the high degree of risk is linked to uncertainty e.g. Legislation and funding changes and risk associated with unknown changes. 

The Member added that current press report claim that Brexit could take 10 years and that this area of Wales can’t wait this long for infrastructure changes.  It was responded that this matter is under discussion by Strong Communities Select Committee, and as more information becomes available, risk levels will be reviewed.

The recommendations listed below were accepted.

1.         That members consider the strategic risks presented for the next three years,        in particular those of relevance to the committee and scrutinise the extent to        which:

•           all relevant risks facing the authority are appropriately captured,

•           the level of risk applied is appropriate based on the matrix in the council’s

            risk management policy and guidance (appendix 2) and

•           mitigating actions are proportionate and appropriate

2.         That members use the risk assessment on an on-going basis to hold the     responsibility holders to account to ensure that risk is being appropriately      managed.

3.         Use the risk assessment to inform the future work programme of the         committee.