Agenda item

The Chair reiterated for the Members of the Audit Committee that the present Committee was an Audit Committee, not a risk Committee and that the Committee was there to review processes undertaken by Newport City Council.

The Head of People and Business Change presented the report to the Audit Committee stating that the report for Quarter 1 highlighted the key areas that were being worked on such as the Covid 19 pandemic and Brexit preparations, which both featured heavily.

The report highlighted some changes to the previous risk report with 6 new risks which were not all new, some of these risks escalated to become part of the Risk Register.

Key points: 

·       There were 57 total risks recorded.

·       Out of the 57 risks recorded, 19 of these were considered to have a significant impact on the achievement of the Council’s objectives.

·       Out of the 19 risks, 1 was a completely new risk and 5 escalated risks were from the service areas risk registers which was pressure on Adult Community Services, pressure on the delivery of Children’s Services, cyber security, pressure on Homelessness and Housing all primarily driven by Covid 19.

·       A new risk emerged which was Ash Die Back Disease.

·       Covid 19 was previously at a risk of 20 and was escalated to a risk of 25.

·       Balancing the Councils medium term budget also increased as well as In year Financial Management as a result of the Covid 19 pandemic.

·       City Centre security and safety also saw a reduction in risk as non-essential retail was closed which minimized the risk.

·       There was a change in Newport Council’s Property Estate due to remote working and a reduction in the Climate Change risk due to Council staff working remotely which had reduced the environmental impact due to changes in air quality.

The Chair questioned as to whether Capital spend was included in the Financial Management Risk, which had increased from 3 to 9. The Assistant Head of Finance confirmed that the In Year Financial Management looked at the revenue budget, and Capital in the future would have an impact on the medium term financial plan. The Chair questioned as to where Capital was picked up as over the last 5 to 6 years there had been a 20-25% underspend on Capital every year and stated that Covid should not be a reason for Capital spend not to be undertaken.

The Assistant Head of Finance confirmed that Capital spend was constantly monitored alongside MTFP as a risk, MTFP has Capital finance on it and was identified as part of the MTPF on the Corporate Risk Register as a specific risk but not the overall slippage.

The Head of Finance stated that this slippage was individual to individual projects as if a school had to be built by a certain date then this was an individual risk.

            Questions: 

·       Councillor Thomas stated that it was unclear as to the insight on the risks and how officers were mitigating risks. In relation to the Ash Die Back Disease risk, Councillor Thomas stated that it would have been useful to have comments on this regarding how risk was going to be mitigated for example by recanting, which could contribute to environmental aims. 

·       In relation to the Housing risk, Councillor Thomas stated that furlough had been extended until March 2021 and that there was a risk of a number of redundancies, which National Government have acknowledged by extending furlough, was there an estimate for the Council area of redundancies.

The Head of Business and People Change acknowledged that this was a looming problem and that the Committee could take this back to the Head of Service for more clarification if requested.

·       Councillor Thomas stated that in relation to homelessness, all of the positive action that the Council has taken were a question of resources and funding for projects e.g. new accommodation units etc and they were not sure if it was a risk, as a lot of funding had been provided to make homeless people safe during the pandemic. They questioned as to whether the issue of homelessness should be on the Corporate Risk Register. 

The Head of People and Business Change confirmed that the pressure was on the homelessness service and that the additional money made available had not changed the Council resource and more staff had not been able to be recruited, therefore the pressure was on the service area.

·       Councillor Thomas stated that it was disappointing to see that the example used for climate change was electric vehicles and that there had been a lot done in this area but that there was still a lot more to be done, and that it was not certain if there were things that were significant that were not being reported in the risk register.

The Head of People and Business Change that there were lots of work going on in the background in relation to climate change. The Chair also commented that the report was a summary and that the committee were not here to audit the process.

·       Councillor Thomas requested for consideration on the speculation on a raise in capital gains tax, which may lead to an exodus from the private housing rental market, and whether the Council had considered the pressures this would have on the provision for housing for people in the city.

The Head of Business and People Change confirmed that this point could be referred back to the service area for consideration, which was agreed by the Chair.

·       Councillor Hourahine commented on the Ash Die Back risk, that the problem was well known for some time and asked for clarification on how any risk was identified and what was the lag time of the risk appearing on the risk register and the process in general.

The Head of Business and People Change explained that risks were being identified constantly, identified through service delivery, new legislation, intelligence gathering, and information from Welsh Government, all gathered on a daily basis.

They also explained that risks and mitigations were put in place very quickly and although there had been a bit more of a lag because of Covid they shouldn’t take much time at all as the risks were dealt with in real time.

In relation to the Ash Die Back Disease, there had been an assessment of the trees and then the risk ended up on the Corporate Risk Register when the scale was understood. The Head of Business and People Change advised the Committee that they could go back to the service area to find out more detail.

·       Councillor Hourahine commented that they felt that many risks were appearing on the Register that maybe could have been dealt with at the point of decision.

The Head of Business and People Change stated that the Council provided over 800 services and that only 57 risks on the register showed that other risks were being dealt with. They commented that some of the larger risks were not resolved easily and there was a reasonably good balance of things resolved at the point of source, and the bigger issues that were in the Risk Register that come to the Audit Committee.

Agreed:

That the report be noted and approved by the Council’s Audit Committee