Woughton Community Council
Register of Corporate Risk
May 2015
Author
Council Manager
CLASSIFICATION OF RISKS
A risk can be either strategic or operational. A strategic risk is one which is not confined to a particular area or service and which may prevent the council meeting one or more of its key objectives. An operational risk is limited in its effect to only one service, although at its most serious it could still affect the ability of the council to meet some of its key objectives.
All risk area classified according to their probability of occurrence and their impact should they occur. This gives them a probability impact score (P/I) score according to their position on the following matrix:
Risk Assessment
Probability / VeryLikely / 5
Likely / 4
Unlikely / 3 / A
Very
Unlikely / 2
Almost
Impossible / 1
1 / 2 / 3 / 4 / 5
Insignificant Minor Significant Major Catastrophic
Impact
In the case shown above, Risk A is deemed unlikely to occur but, if it did, it would have a major impact.
Once a risk has been identified and evaluated it has to be decided how the Council will react. There are four options – the four T’s
- Tolerate – Decide to live with the risk, the possibility that it might occur and its consequences.
- Terminate- Eliminate the risk, usually by deciding to avoid a course of action or stop the particular activity.
- Transfer – Some of the financial risk may be transferred through insurance and it may be possible to transfer liability through contractual arrangements.
- Treat – This contains two elements. Containment is the application of measures to reduce either the probability or impact; contingency is the action to take if the event does occur
This register gives the residual risk once the control has been applied.
The risk owner is that officer who is responsible for putting in place the arrangements as set out under the column ‘Treat, Tolerate, Terminate or Transfer’. The ‘owner’ is specified either for all the risks in a section, of for specific risks in a section where different.
STRATEGIC RISKS
The strategic risks for Woughton Parish Council have been identified as lying in the following categories: Infrastructure, Finance, People, Reputation, Partnerships, Organisational and Service Delivery.
AInfrastructure – Owner: Council Manager / Operations Manager
Description / Probability/Impact / Treat, Tolerate, Terminate,TransferA1 Parish Offices / Building may be rendered wholly or partially unusable as a result of fire, flood explosion, infestation collapse or other catastrophic event / 1/4 / Treat through business continuity emergency plans. The worst case is probably too low to terminate, transfer or treat (containment|)
A2 ICT system / ICT system fails preventing officers from accessing data or carrying out processing for an extended period / 3/4 / Treatthrough business continuity emergency plans. Internal ICT practices limit the probability
BFinance - Owner: Council Manager / Operations Manager
B1
Insufficient Funds / Our income/outgoings equation reduces our reserves below the minimum figures / 1/3 / Treat by normal financial arrangements
B2 Embezzlement or theft / Our funds are plundered by illegal action resulting in a loss of more than £50,000 / 1/4 / Treat by audit and other check processes
B3 Internal Failure / Failure of corporate budgetary control or financial forecasting process / 2/3 / Treat by audit and other check processes
B4 Internal Audit Plan / Failure to complete Audit Plan / 4/2 / Treat risk mitigated by monitoring
B5 Irregularities / Failure to pick up an irregularity of substance / 2/3 / Treat review of audit findings mitigates risk
B6 Procurement / Contractor sues for consequential loss following failure to win a contract / 3/3 / Treat by robust tender evaluation processes
C People – Owner Council Manager / Operations Manager
Description / Probability/Impact / Treat, Tolerate, Terminate, Transfer
C1 Available employees fall below 50% through illness / An outbreak of illness or disease reduces the number of people at work for an extended period to less than 50% of establishment / 1/4 / Treat Consider action if serious infectious illness becomes prevalent – vaccination, dispersal of staff etc
C2 Available employees fall below 50% through industrial action / Industrial action (internal or external) reduces the number of people available at work for an extended period by more than 50% / 2/3 / Treat Consider action if industrial action is signalled
C3 Lottery win / A lottery win leads to widespread resignations / 1/2 / Tolerate
C4 Employees attacked / An employee is attacked and injured while on Council business / 3/3 / Treat Lone working rules. Review process regularly
D Reputation – Owner Council Manager
D1 Public Confidence / Council’s reputation is damaged by serious breach of Members’ Code of Conduct / 2/3 / Treat Declaration of Interests procedure and Member training
D2 Investigation / A major investigation results in paralysis while people are suspended / 1/3 / Tolerate
D3 Public image / Council services alleged as poor resulting in our reputation suffering perhaps exacerbated through a newspaper campaign / 3/2 / Treat thorough training of staff should prevent. Impact could be contained by ensuring good response to public enquiries, tackling specific complaints and by effective handling.
E Partnerships – Owner Council Manager / Service Manager/ Lead Youth Worker
Partnership working contains a number of possible risks:
- The partnership fails to meet its objectives
- The reputation implications of failure
- Financial costs rise as a result of partnership problems or collapse
- Costs or difficulties associated with withdrawal if required
OPERATIONAL RISKS
Operational risks are those which arise in a particular service. There are 12 service areas controlled by 3 senior managers:
Organisational Development
Community Involvement
Community Development
Projects
Policy
Allotments
Youth Provision
Administrative Services
Democratic Services
ICT
Financial/Audit
Communications
Landscaping
Organisational Development – Owner CEODescription / Probability/Impact / Threat, Tolerate, Terminate, Transfer
OD1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Tolerate
OD2 Staff / Insufficient trained staff to meet targets / 2/2 / Tolerate
OD3 Litigation / An employee takes legal action against Council under employment law and wins’ damages greater than £50k / 2/2 / Tolerate Implementation and audit of HR processes
Community Involvement – Owners Deputy Chief Executive Officer
CI 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Tolerate
CI 2 Staff / Insufficient trained staff to meet targets / 2/2 / Tolerate
Community Development – Owner Deputy Chief Executive Officer
CD 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Tolerate
CD 2 Staff / Insufficient trained staff to meet targets / 2/2 / Tolerate
Projects – Owner Council Manager/ Service Manager
Description / Probability/Impact / Treat, Tolerate, Terminate, Transfer
P 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Threat All managers/ budget holders closely monitor cost centre/code details
P 2 Staff / Insufficient trained staff to meet targets / 2/2 / Threat Identify future training needs through appraisal. Recruit experienced practitioners where necessary.
Policy – Owner CEO
P 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Tolerate
P 2 Staff / Insufficient trained staff to meet targets / 2/2 / Threat regularly review and consider alternative methods of service decision making
P3 Reputation / Sound but unpopular decisions damage reputation / 3/2 / Tolerate Managerial responsibility and effective PR
Allotments – Owner (Currently not in operation)
AL1 Budget Overspend / Budget Overspend in year of more than 5% / 3/2 / Threat Budget holders closely monitor cost centre/code details
AL2 Reputation / Sound but unpopular decisions damage reputation / 3/2 / Tolerate Managerial responsibility and effective PR
AL3 Loss of Income / Income falls 25% below budgeted levels / 2/2 / Tolerate Budget holders monitor and alert CM
AL4 Loss of tenants / Take up of allotments falls below 75% / 2/2 / Tolerate Managers alert CM – Publicity to alleviate
AL5 Allotment Association Failure / Allotment Association folds due to lack of support/ committee. / 2/3 / Tolerate continue to provide support through Manager
Youth Provision – Deputy Chief Executive Officer/Youth Manager
Description / Probability/Impact / Treat, Tolerate, Terminate, Transfer
YP 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Threat Managers/ budget holders closely monitor cost centre/code details
YP 2 Staff / Insufficient trained staff to meet targets / 2/2 / Threat Identify future training needs through appraisal.
YP 3 Litigation / A young person takes legal action against Council and wins / 2/2 / Tolerate Implementation and audit of Child protection policies. No Lone Working. Safeguarding Officer – Youth Manager and trained by MKCSB
Administrative Services – CEO
AS 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Threat Managers closely monitors cost centre / code details
AS 2 Staff / Insufficient trained staff to meet targets / 3/3 / Threat Identify future training needs through appraisal.
AS 3 Print Services / Print Services unable to meet output tasks / Threat Outsource if necessary and prudent
Democratic Services –CEO/Committees Officer
DS 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Threat Managers closely monitors cost centre / code details
DS 2 Staff / Insufficient trained staff to meet targets / 3/3 / Threat Identify future training needs through appraisal.
DS3 Illegal Decision / Decisions successfully challenged on grounds of procedural legality / 1/3 / Threat adherence to Standing Orders, Financial Regulations and members’ Code of Conduct
ICT Owner Contracts Officer/ CEO
Description / Probability/Impact / Treat, Tolerate, Terminate, Transfer
ICT 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Tolerate
ICT 2 Staff / Insufficient trained staff to meet targets / 3/2 / Threat Identify future training needs through appraisal.
ICT 3 Data Loss / Irrecoverable loss of more than two days data / 3/4 / Tolerate – daily back up - new procedures in progress. Data stored offsite not cloud
ICT4 Hacking / Someone hacks into our system and make illegal use of data / 3/4 / Tolerate. Firewalls inplace
ICT 5 System Failure / Computer system fails for more than one day / 3/3 / Tolerate
Back up as above
ICT 6 Telephone failure / Telephone system fails for more than one week / 1/4 / Tolerate mobile phones as a fallback
Finance/Audit - Owner CEO / RFO
FA 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Threat via budgetarycontrol
FA 2 Staff / Insufficient trained staff to meet targets / 3/2 / Tolerate
FA3 Investment income / Poor investment returns / 2/4 / Threat via monitoring and report
FA4 Insurance / Failure to insure adequately / 2/4 / Threat – Audit checks
FA5 Payroll / Failure to pay employees on time / 1/2 / Tolerate – outsourced payroll supplier
FA6 Creditors / Failure to pay suppliers on time / 2/1 / Tolerate
FA7 Annual Budget / Failure to produce annual budget on time / 2/3 / Tolerate
FA8 Annual Accounts / Failure to close annual accounts on time / 2/3 / Tolerate
FA9 Auditor’s report / Qualified accounts or adverse external audit / 2/4 / Threat Normal monitoring mechanisms
FA10 Legal challenge to audit / Council’s annual accounts successfully challenged on grounds of legality / 1/4
FA11 Procurement / Those procuring goods and services do not properly utilise the procedures / 4/3 / Treat – by training and monitoring also Internal and externalAudit monitoring
Communications – Owner Council Manager / External Communications Officer
Description / Probability/Impact / Treat, Tolerate, Terminate, Transfer
Com 1 Budget Overspend / Budget Overspend in year of more than 5% / 2/2 / Treat via budgetarycontrol
Com2 Staff / Insufficient trained staff to meet targets / 3/2 / Tolerate identify needs through appraisal process
Com3 Media campaign / The local media mounts a campaign which could undermine confidence internally and externally / 2/3 / Tolerate maintain appropriate contact with media
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