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RISK MANAGEMENT 2013

1. INTRODUCTION. Risk Management is the process whereby local councils methodically address the risks associated with what they do and the services which they provide. The focus of good risk management is to identify what can go wrong and take proportionate steps to avoid this or successfully manage the consequences.

 

It is not just about financial management, it is about ensuring the achievement of objectives set by the council to deliver high quality public services. The failure to manage risks effectively can be expensive in terms of litigation and reputation, the ability to achieve desired targets and, eventually on the local community's Council Tax bills.

 

Local authorities currently face pressures, including those associated with the powers around well-being, that potentially give rise to a range of new and complex risks and which suggest that risk management is more important now than at any other time.

 

Members are ultimately responsible for risk management because risks threaten the achievement of policy objectives. As a minimum, at least once each year members should:

  • take steps to identify and update their record of key risks facing the council;
  • evaluate the potential consequences to the council if an event identified as a risk takes place;
  • decide upon appropriate measures to avoid, reduce or control the risk or its consequences; and
  • record any conclusions or decisions reached.

2. THREE AREAS OF RISK MANAGEMENT. There are three main types of decision that councils take in relation to managing risk, having considered the controls which they need to have in place. These are:

  1. Insurance cover for risk. The Parish Council has a three-year agreement with Aviva Insurance UK Limited (through Came & Company) expiring in September 2015, Policy Number 24414511 CHC where items are index-linked. In Sedlescombe this covers:
    1. The protection of physical assets owned by the Council (property damage all risks and theft)
    2. The risk of damage to third party property or individuals as a consequence of the Council providing services or amenities to the public (public liability).
    3. The risk of injury to the Clerk or councillors (money and assault & personal accident).
    4. Loss of cash through theft or dishonesty (fidelity guarantee).
    5. Legal liability as a consequence of asset ownership (public liability).

      Internal controls include the following:
    6. Up-to-date register of assets and investments reviewed by the Finance Committee at the end of March each year.
    7. Annual Inspection resulting in a Job List which is reviewed by Finance Committee every quarter allowing protection of assets.
    8. Annual review of risk and the adequacy of cover by the Finance Committee at the end of March each year.
    9. Well-known insurance provider used with special parish council insurance policy.

  2. Working with others to help manage risk. Specialist external bodies are used as appropriate:
    1. Annual professional inspection of playground.
    2. Banking arrangements with Barclays Bank plc, Co-operative Bank and West Bromwich Building Society.
    3. Use of professionals to provide expert services (survey of land, drawing of plans etc.)
    4. Contractors with the necessary qualifications to carry out work on behalf of the Council.
    5. Advising local organisations which are lessees of Council land regarding insurance protection.

  3. Self-management of risk. Internal controls include the following:
    1. Quarterly scrutiny of financial records and monitoring of the budget by Finance Committee.
    2. Regular returns of VAT.
    3. Minutes properly numbered and paginated with a signed master copy kept in safekeeping.
    4. Documented procedures to deal with complaints from the public.
    5. Agenda, Minutes, Bank Reconciliations, Cheque Lists and Clerk's Briefings in the public domain on the www.sedlescombe.org.uk website.
    6. Procedures in place for recording Members' interests and gifts and hospitality received.

  4. Internal controls (see full report) include the following:
    1. Standing orders reviewed July 2012.
    2. Financial regulations reviewed 16/11/2010.
    3. Annual review of contracts.
    4. Monthly review of the bank reconciliations by Chairman of Finance Committee. Other members of the Finance Committee are in attendance from time to time.
    5. Annual internal audit testing of controls.

 

3. PROTECTION OF PHYSICAL ASSETS - see Asset Register

  1. Buildings
    1. Sedlescombe Pumphouse including the disused Pump. Insured. Property Damage, All Risks and Theft - (£250 excess).

      There is a HIGH risk of damage occurring to the Pumphouse and its contents because of its open position. However, most of the damage is likely to be fairly minor and it would not be worthwhile making an insurance claim. The Pumphouse is in a open position in full view of passing motorists and pedestrians. The following mitigation measures are in place to safeguard major damage or theft:
      1. New from ground to ceiling iron railings surround the pump. These should limit vandalism of the pump structure.
      2. The refurbished pump structure has been sealed to the base in order to prohibit theft.
      3. The Police are aware of the risk of damage/theft.

    2. Pavilion at Sedlescombe Sportsfield. The sportsfield and buildings were leased to Sedlescombe Sports Association Trustees for 30 years from 01/08/2005. A new pavilion was built by Sedlescombe Parish Council and handed over to the Trustees on 01/04/2009. There is a HIGH risk of damage occurring to the pavilion mainly from vandalism. A Deed of Variation to the Lease dates from 08/11/2009 to protect the pavilion. This requires the Sports Association Trustees to:
      1. Repair and clean the pavilion.
      2. Keep drains, pipes, wires and cables in good, clean and substantial repair.
      3. Insure the premises, including the pavilion, in a substantial and reputable insurance office in the full cost of rebuilding and reinstatement including architects', surveyors' and other fees and the cost of debris removal and site clearance. Also to insure against loss or damage by fire, lightning and other risks the Parish Council deems desirable and Landlord's liability.
      4. Take full responsibility for the general supervision and care of the pavilion and to take all reasonable measures to deter trespassers and prevent criminal damage.

      A parish councillor is appointed annually to be a full voting member of the Sports Association Committee in order to ensure that the Council's interests are protected. Since his appointment to this position, Cllr Anson has been working with the Sports Association to improve the insurance of the pavilion. This will require the Lease to be redrawn.

      An annual inspection of the pavilion by a parish councillor with appropriate experience in building takes place. A list of recommendations from the Council is then passed to the Sports Association Committee. The Sports Association Committee uses a Terms and Conditions Booking Form for the Sportsfield and Pavilion. Warnings of dangers are included on the form.

      Confirmation of insurance of the pavilion is obtained by the Council annually.

      The building is fitted with a burglar alarm and is regularly checked by BeSure Ltd.

      The building has been built on piers to safeguard it from flooding should the River Brede overflow.

    3. Bus Shelter. Insured through Parish Council Policy with Aviva through Came and Company. Property Damage, All Risks and Theft "Street Furniture" along with the Council noticeboard. There is a HIGH risk of damage from vandalism occurring to the bus shelter situated outside Pollards in The Street. Mostly, the damage will be minor which can be repaired fairly easily. The Council has been relying on the shelter being replaced by the developer of Park View, The Street in accordance with the planning permission.

    4. Portacabin. Although the portacabin was insured up until mid-2010, it is no longer insured. There is a HIGH risk of damage from vandalism occurring to the portacabin although its position in the sportsfield car park could make it less susceptible than when it was next to the pavilion. If it is used by the Societies Association and the Sports Association for storage, the contents will not be insured by the Council. Mitigation measures are not possible. Portacabin should have been removed, in accordance with the Council's wishes.

    5. Blue container. The container in the sportsfield car park is not insured by the Council under its property damage, all risks, insurance policy. Because of its construction, there is a LOW risk of damage from vandalism occurring to the container. The contents which belong to members of the Football Club are not insured by the Council

  2. Street furniture. Insured. Property Damage, All Risks and Theft. £250 excess. Apart from the bus shelter mentioned above, the only other item under this category is the Noticeboard on wall of shop. There is a HIGH risk of damage from vandalism. Safety glass has been installed. Repair minor damage quickly for safety.

  3. Other street furniture which is not insured:

    1. Brede Lane car park interpretation board (allowed under a licence from Rother District Council which requires offensive graffiti to be removed urgently). HIGH risk of vandalism. Refurbished board replaced in 2012 in commemoration of the Queen's Diamond Jubilee.

    2. Seats. There is a HIGH risk of vandalism. Repair damage quickly. In order to reduce the likelihood of future damage to the seats, recycled plastic replacement seats will be considered as required.

    3. Litter bins. There is HIGH risk of vandalism. Repair damage quickly. In order to reduce the likelihood of future damage to the litter bins, recycled plastic replacement bins will be considered as required.

    4. Dog bins. There is a HIGH risk of vandalism. Repair damage quickly.

    5. Village sign on post on Village Green. There is a LOW risk of vandalism because of it height above the ground.

4. PROTECTION OF LAND AND PUBLIC USE - NB all Parish Council insurance company is arranged with Aviva through Came & Company. Renewed on a three and a quarter year agreement expiring at the end of September 2015.

  1. East View Terrace Kickabout Area. The area is inspected weekly by parish councillors on a rota basis. Written reports are forwarded to the Clerk who arranges their retention and adds necessary work to an ongoing "Jobs List" monitored by the Council's Finance Committee. The following risks have been identified at the Kickabout Area:
    1. Injury to person using area - HIGH risk. Insured. Public and Products Liability £10,000,000.
    2. Damage to surrounding property. LOW risk. Public and Products Liability £10,000,000.
    3. Damage to equipment and furniture. MEDIUM risk. Not insured. Regular inspection and maintenance and strongly-built equipment.
    4. Damage to chain-link fencing. HIGH risk. Not insured. Repair as soon as practicable to limit damage.
    5. Illegal drug use or dealing. MEDIUM risk. Open aspect maintained. PCSO attends as necessary.
    6. Loitering with intent to cause injury to children. MEDIUM risk. Open aspect maintained. PCSO attends as necessary.
    7. Attempt to establish a right of way across land. Reduced to LOW risk by registering under Highways Act 1980 [s31(6)] with East Sussex County Council that there are no ways over the land that have been dedicated as highways as at 29/05/11.
    8. Entry by travellers. LOW risk without removal of fencing. Site close to housing.

  2. Red Barn Field Nature Park. The following risks have been identified at the Nature Park:
    1. Injury to person using area - LOW risk. Public and Products Liability £10,000,000.
    2. Drowning accident. Pond - maximum of 72cm deep. MEDIUM risk. The following mitigation measures have been introduced:
      1. Warning sign maintained regularly.
      2. Rubbish is not allowed to accumulate near the pond.
      3. Notice restricting area to children only when with adults.
    3. Fences and gates - MEDIUM risk of damage to fences either by vandals or even by neighbouring property owners trying to gain access. LOW risk of gates being stolen.
    4. Establishment of right of way across land. Reduced to LOW risk.
      1. By registering under Highways Act 1980 [s31(6)] with East Sussex County Council that there are no rights of way over the land as at 29/05/11.
      2. Surrounding owners to be reminded regularly they do not have access directly from their properties to Red Barn Field.
      3. School House has put up a wire fence on their eastern boundary.
      4. Hedging planted on boundary with Century House to stop access (February 2011).
      5. Notices placed on boards reminding users that the path is not a public right of way.
    5. Damage to furniture. LOW risk. Vandal-resistant recycled plastic used.
    6. Damage to boards. LOW risk.
    7. Damage to trees. LOW risk.
    8. Theft of newly-planted fruiting hedgerow. Reduced to MEDIUM risk because of passage of time. Police and local people aware and patrolling.
    9. Entry by travellers. MEDIUM risk. Field gates to be kept locked.
    10. Illegal drug use or dealing. LOW risk. Notice restricting use of ground to daylight hours.

  3. Playing Field & Recreation Ground Trust Property. The Trustee (also the Parish Council) has separate insurance. cover for the land. As occupier and manager of the land, the Parish Council also has a duty of care. The following risks have been identified:
    1. Injury to person using area. HIGH risk. Insured. Public and Products Liability £10,000,000. Weekly inspection of the playground by councillors who produce a written report. Annual professional inspection.
    2. Accident involving river. MEDIUM risk. Insured. Public and Products Liability £10,000,000. Weekly inspection by councillors. New fence in play area provided 2011. Regular maintenance of fence as necessary.
    3. Accident involving Giant Hogweed. Reduced to LOW risk following several years of treatment and monitoring by specialist firm.
    4. Damage to equipment and furniture. HIGH risk. Not insured. Regular inspection and maintenance.
    5. Theft of gate(s). LOW risk.
    6. Illegal drug use or dealing. MEDIUM risk. Police asked to monitor for possible problems. Open aspect to be maintained.
    7. Loitering with intent to cause damage to children. MEDIUM risk. Open aspect to be maintained.
    8. Injury to children leaving the playground on the B2244. LOW risk. Warning road signs in place.
    9. Entry by travellers. HIGH risk. Mitigated by being in a busy area and close to housing.
    10. Damage to tennis court fence, surface and nets. HIGH risk. No cover. Fenced replaced in 2012 with robust sports fencing. One gate only retained. Surface to be replaced in 2013 when weather permits and one gate renewed.
    11. Flooding of courts. HIGH risk. Owing to location. Flooded in 2012.

  4. Sportsfield. (See also pavilion at 3.2 above) Although the Parish Council owns the freehold of the sportsfield, the land and buildings are leased to Sedlescombe Sports Association's 3 Trustees (John Mainwood, David Mitchell and Ashley Davey). This does not include the older part of the car park which is dealt with separately below. As occupier of the land, the Sports Association has a duty of care towards anyone, whether visitor or trespasser, coming on to the premises. Any breach of the duty which causes personal injury or damage to goods, makes the occupier liable to pay damages (the common law is extended by the Occupiers' Liability Acts 1957 and 1984). The following risks have been identified:

    1. Flooding of Sportsfield. MEDIUM risk. Being dealt with by the Sports Association clearing the surrounding ditch. In March 2011, the Council the Environment Agency agreed to repair the HamBaker Circular Flap Valve situated in the riverbank level with the Pestalozzi part of the ditch. This should prohibit reverse flow conditions which could flood the field in the event of extreme rainfall. Because of shortage of funds, the Sports Association was unable to clear the ditch in 2011. A clearance of the whole ditch from the pavilion to the river was, therefore, undertaken by the Parish Council in 2011 with financial assistance from the Sedlescombe Football Club and Pestalozzi International Village (part of the ditch belongs to them). Councillor representative to check that allowance is being made in the Sports Association Committee budget to adequately maintain the ditch.
      Confirmation has been given to the Sports Association by Cllr Vine-Hall that there is no problem with the culvert under the Sportsfield Car Park but that the Committee must ensure that it is kept from from litter eg plastic bottles.
    2. Attempt to establish a second right of way across land. Reduced to LOW risk by registering the public right of way across the field as the only right with East Sussex County Council under the Highways Act 1980 [s31(6)].
    3. Risk of travellers entering the field. The field has an open aspect and is well used by the public. The Parish Council/Sports Association lease requires the Sports Association to insure the premises and to take all reasonable measures to deter trespassers and prevent criminal damage. Increased to HIGH risk as, in March 2012, the Sports Association Committee reported that the field gate to the car park had been lifted off its hinges and various small metal items belonging to the Association had been stolen. The gate had been replaced with alteration to the fittings carried out. Later in 2012, the Sports Association reported that construction waste had been fly-tipped at the car park. Cllr Vine-Hall made arrangements for the material to be removed by French's Skips.

      There is a HIGH risk of people being injured on the field (other than when playing official games which is covered by individual sports clubs' insurances). The Council has taken the following steps to mitigate the dangers:
    4. The Parish Council has advised the Sports Association to take out public liability insurance cover. The 2012 copy has been received.
    5. The Environment Agency has put up warning notices regarding the river on all entrances to the field.
    6. The Sports Association has been reminded that it should warn hirers of the field of the danger of the river which can rise rapidly. Included in the Terms and Conditions booking forms.
    7. Hirers of the field need to be made aware of the public right of way across the field and that they should take care not to expose walkers to danger from balls. Included in the Terms and Conditions booking forms.
    8. Golf is not allowed to be played on the field. Included in the Terms and Conditions booking forms.
    9. Dogs on leads Control Order introduced in 2010 in order to ensure that dog faeces is not inadvertently left on the sports pitches causing a danger, albeit a low one, of a player contracting Toxicariasis which may lead to eye damage or even blindness, particularly in children. Free bags available from the Parish Council.
    10. Loitering with intent to cause damage to children. The field has an open aspect and is well used by the public.
    11. Breaking of covenant on purchase of land regarding "no parking in Pestalozzi road". The Sports Association has signed the lease which requires them to comply with this covenant. Increased complaints from Pestalozzi Trust in 2011-12 because of parking of vehicles in Ladybird Lane which is contrary to legal agreements and obstructs access to homes and other buildings on the Estate. Most of the overflow parking can be attributed to Sportsfield users but not all as dog walkers are also parking in the Lane. In January 2013, a letter from the Chairman of Sedlescombe Football Club included reference to the improved parking situation with the provision of a larger car park.

  5. Sportsfield Car Park. Part of the enlarged car park has been retained by the Parish Council. There is a MEDIUM risk of injury for users of the Car Park. Insured. Public and Products Liability £10,000,000.
    The following risks have been identified:
    1. Injury to pedestrians while vehicles are being manoeuvred. Insured.
    2. Theft of, or damage to, motor vehicles parked in the car park should be covered by motorists' own insurance.
    3. Attempt at establishing a right of way across the land. Reduced to LOW risk by the Parish Council's registration under the Highways Act 1980 [s31(6)] with East Sussex County Council that there is no right of way across the car park as at 29/05/11.
    4. See 4.3 and 4.11 above also.

  6. Village Hall Car Park leased to two trustees of the Village Hall Charity (one deceased, the other an ex-prisoner). As occupier of the land, the Village Hall Trustees have a duty of care towards anyone, whether visitor or trespasser, coming on to the premises. Any breach of the duty which causes personal injury or damage to goods, makes the occupier liable to pay damages (the common law is extended by the Occupiers' Liability Acts 1957 and 1984). The following risks have been identified:
    1. There is a MEDIUM risk of injury to users of the Car Park. Public liability insurance by Sedlescombe Village Hall Charity. Copy received annually.
    2. Theft of, or damage to, motor vehicles parked in the car park should be covered by motorists' own insurance.
    3. Attempt at establishing a right of way across the land. Reduced to LOW risk by the Parish council's registration under the Highways Act 1980 [s31(6)] with East Sussex County Council that there was no right of way through the car park as at 29/05/11.

  7. Village Green. Most of the property on the Green has already been mentioned apart from the following:
    1. Damage to trees. HIGH risk. Regular maintenance of trees by professional tree surgeons.
    2. Damage to surface of Green. HIGH risk. Mitigation measures introduced in 2012 are six flower planters on the Green sponsored by Blackbrooks Garden Centre to stop vehicles parking on the edge of the top part of the Green. Damage is still being caused by vehicles being driven over the edges of the Green. Westridge Construction has agreed to repair the edge of the top part of the Green following damage by its large vehicles in 2012.
    3. Hirers' liability for damage. LOW risk. Allowed strictly in accordance with adopted Policy and Byelaws. The current insurance policy has a Hirers Indemnity section which covers the legal liability for hirers of Parish Council property if damage occurs during the hiring period.
    4. Hirers' public liability. All hirers must have arrange their own Public Liability Insurance cover.

  8. Use of Volunteers. Volunteers working on behalf of, and with approval of, the Parish Council will be covered by the Parish Council insurance. They may use their own tools but they must be in good working order. In 2012, the Council set up a new Volunteer Scheme with Cllrs Chapman and Parsons as lead members. A volunteer registration agreement was produced together with job sheets for each type of voluntary work.

5. PROTECTION OF OFFICE CONTENTS. Insured. Property Damage, All Risks and Theft. Office contents £4,698.73. £250 excess. The following risks have been identified:

  1. Computer, associated equipment and other general office equipment. The following risks have been identified:
    1. Theft. HIGH risk although house has intruder alarm and good locks.
    2. Loss by fire or flood. LOW risk.
    3. Loss of data. HIGH risk. The following mitigation measures have been adopted:
      1. Regular back-ups of data including one copy held remotely for the other back-up copy. Contact phone number provided to Chairman. Additionally, from the end of 2012, the majority of work-a-day files are held on Microsoft's Sky-Drive for remote access. Please note that this does not include access to e-mails which is not currently viable.
      2. Most of Parish Council documents are on the website.
  2. Document files in Clerk's home. LOW risk of loss. Kept to a minimum and mostly backed-up electronically. Held in metal filing cabinets. Some files passed to County Record Office for preservation.
  3. Document files in cupboard of the Village Hall. MEDIUM risk of loss. Considered acceptable.
  4. Deeds. Copy kept by Clerk. Originals with County Record Office or Solicitor (Menneers).
  5. Archives. In Clerk's home. Some in County Record Office including original painted Parish Map. Some on website.
  6. Map. 25"/mile map on cloth and rollers in Village Hall loft.
  7. Silver cups (2). Kept in Clerk's home. LOW risk of theft as low value.

6. PROTECTION OF THE CLERK AND COUNCILLORS

  1. Assault on Clerk with money in transit up to age of 80. There is a LOW risk as the Clerk hardly ever carries cash to the Bank. Insured with Aviva Insurance UK Limited (through Came & Company) under a 3-year agreement.
  2. Personal Accident compensation age 16-85 for employee, members or volunteers. Capital benefits £50,000. Temporary Total Disablement £200pw.
  3. Injury to Clerk by visitor to home purporting to be on official business. LOW risk. The following measures have been put in place to limit injury:
    1. Visits by appointment only.
    2. Another person in house at the time.
  4. Accident involving car in course of work. LOW risk. Clerk's own comprehensive insurance cover. Insurance Company aware that car is used for work.
  5. Libel and Slander £250,000 limited of indemnity.

7. PROTECTION OF COUNCIL FUNDS

  1. Cheques etc. There is a MEDIUM risk of cheques being lost. Insured with Aviva Insurance UK Limited (through Came & Company) under a 3-year agreement £250,000.
  2. Money. Non-negotiable money £250,000. Negotiable money on premises £1,000. Negotiable Money, any other loss £1,000
  3. Fidelity Guarantee. Limit of indemnity increased from £100,000 to £150,000 in 2013.
  4. Employer's liability. £10,000,000 cover.
  5. Legal expenses arising from Corporate Manslaughter and Corporate Homicide Act 2007. Covered.
  6. Parish Council property insured anywhere in the European Union.
  7. Commercial Legal Protection. £50,000 cover.
  8. Official indemnity
    1. Limit of indemnity increased from £250,000 to £500,000 in 2013.
    2. Aggregate Inner Limit for Pollution £100,000.
  9. Hirers' Indemnity increased from £2,000,000 TO £5,000,000 in 2013.
  10. Personal Accident. Age limit increased from 85 to 90 in 2013 (for death or permanent injury).
  11. Business Interruption. Not insured.
  12. No claims bonus/excess. Insured.
  13. Contractors. All contractors appointed by the Parish Council must have their own public liability insurance cover which according to Came & Company although it is not essential for it to be £10mn. There should also be indemnity to the Parish Council as Principal. They should also have Property Damage cover with a maximum excess of £500.

The basis for the information in 1 and 2 above was been taken from "Governance and Accountability for Local Councils 2010".

Mrs P Raymond
Clerk/Responsible Financial Officer, Sedlescombe Parish Council
01424 870508, sedlescombe@freezone.co.uk, www.sedlescombe.org.uk

March 2013