CSR: Effective management of risk vital

With Chancellor George Osborne’s announcement that local government funding will be cut by 7.1% each year for the next four years, and additional cuts being made in education, police and social care budgets, public services need to be prepared to meet the challenges of doing more with less. Public risk management association, Alarm, is appealing to public service organisations to ensure that risk management is central to their drive for efficiency.

CEO of Alarm, Dr Lynn Drennan says “risks facing the public sector in the light of the CSR cuts include loss of key personnel, a reduction in the quality of services being delivered, reputational damage and public dissatisfaction. Organisations may also face industrial action and it is therefore imperative that risk management is high on the senior management’s agenda, to make sure these threats are identified and mitigated”.

Local authorities may also face the increased risk of fraud and economic crime. According to Alarm Chair, Tracy Barnett, “there is a real risk of increased instances of fraud and financial irregularity. During changes to organisational structures, there is a strong possibility that control systems will break down, putting the authority at risk. It is well documented that, in times of change and dissatisfaction, instances of fraud rise. This is particularly true when staff are disgruntled, which is invariably the case when major restructuring or redundancies occur”. Effective management of risk is essential in ensuring that organisations are ready for the challenges they now face.