Agenda item

Risk Appetite

(Cabinet Member with Special Responsibility Councillor Phillip Black)

 

Report of Chief Executive  (report published on 29/11/23)

Minutes:

(Cabinet Member with Special Responsibility Councillor Phillip Black)

 

Cabinet received a report from the Chief Executive to enable Cabinet to  note and endorse the appropriate risk appetite levels for the Council.  The Leader had agreed for this to be considered by Cabinet following a request from the Chair of Audit Committee in accordance with Part 3, Section 2, Cabinet Procedure Rule 16 of the Constitution.

 

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

 

 

Option 1: Endorse the recommended risk appetite levels as proposed in appendix A.

Option 2: Set different risk appetite levels, using the definitions in appendix A.

Option 3: Write and adopt new risk appetite definitions, specific to LCC

Advantages

Best practice on risk categories and risk appetite levels will be adopted.

Decision makers are satisfied with the adopted risk levels.

The risk appetite definitions will be very specific to LCC

Disadvantages

Resource time is necessary to deliver this work.

Resource time is necessary to deliver this work.

Resource time and effort required to create appropriate risk appetite levels for each risk category. The risk appetite levels will not follow any kind of best practice.

Risks

Adopting best practice would strengthen the councils risk management and make it fit for the future.

Adopting best practice would strengthen the councils risk management and make it fit for the future.

Not following best practice or any defined model will not allow the council to compare its risks to that of other local authorities.

 

 

The recommended option is to proceed with endorsing the recommended the risk appetite levels as shown in appendix A (Option 1).  Members considered the risk categories and definitions and after some discussion it was agreed to vote on whether ‘operations’ and ‘legal’ should be moved.

 

It was proposed by Councillor Wilkinson and seconded by Councillor Ainscough and agreed unanimously when put to the vote ‘that Operations be amended from cautious to open.’

 

Resolved unanimously:

 

(1)             That Operations be amended from cautious to open.

 

It was then proposed by Councillor Hamilton-Cox and seconded by Councillor Caroline Jackson: ‘that Legal be revised from minimal to cautious.’   Upon being put to the vote (8 Members (Councillors Ainscough, Phillip Black, Dowding, Hamilton-Cox, Caroline Jackson, Parr, Potter & Wilkinson ) voted in favour, 1 Member (Councillor Wood) voted against and 1 Member  (Councillor Peter Jackson) abstained.)

 

Resolved:

 

(2)             That Legal be revised from minimal to cautious.

 

Councillor Phillip Black then proposed, seconded by Councillor Peter Jackson:-

 

“That Appendix A be amended to reflect the revisions to ‘Operations’ and ‘Legal’ and that the revised risk appetite levels for risks across the Council be adopted with the inclusion of ‘whilst recognising that it may be necessary to deviate from the adopted risk appetite for individual decisions when there is a good reason to do so.”

 

Councillors then voted:-

 

Resolved unanimously:

 

That Appendix A be amended to reflect the revisions to ‘Operations’ and ‘Legal’ and that the revised risk appetite levels for risks across the Council be adopted with the inclusion of ‘whilst recognising that it may be necessary to deviate from the adopted risk appetite for individual decisions when there is a good reason to do so.”

 

Officer responsible for effecting the decision:

 

Chief Executive

 

Reasons for making the decision:

 

The Council have a Risk Management Policy, which is written to provide guidance on the management of risk. Risk Management is identified in the proposed Council Plan 2024-27.  Endorsing the recommended risk appetite levels will strengthen the council’s approach to risk management.

Supporting documents: