Strategic Risk Register Review
Argyll and Bute Council · 16 June 2026
Back to Argyll and Bute HSCP Audit and Risk Committee — 16 June 2026 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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1 Audit & Risk Committee Date of Meeting: 16 June 2026 Title of Report: Strategic Risk Register Review Presented by: James Gow, Head of Finance The Audit & Risk Committee is asked to: • Review and approve the Strategic Risk Register. • Note the outcome of the Risk Appetite Workshop and consider if the committee wish to recommend any changes to the risk appetite to the IJB. • Note that the Strategic Risk Register will be presented to the September 2026 meeting of the IJB. 1. EXECUTIVE SUMMARY 1.1 An important element of effective Risk Management is to regularly review the Strategic Risk Register (SRR). The Audit & Risk Committee undertake this on behalf of the IJB. This report provides an opportunity for the Committee to review the SRR and consider the outcome of the Risk Appetite review. 2. RECOMMENDATIONS 2.1 The Audit & Risk Committee is recommended to: • Review and approve the Strategic Risk Register. • Note the outcome of the Risk Appetite Workshop and consider if the committee wish to recommend any changes to the risk appetite to the IJB. • Note that the Strategic Risk Register will be presented to the September 2026 meeting of the IJB. 3. DETAIL OF REPORT 3.1 The Strategic Risk Register (SRR) is used to identify risks, assess their perceived likelihood and impact and outline how they are being mitigated. It is a dynamic document and is reviewed by the IJB twice annually. The current SRR is attached as appendix 1. It describes 21 strategic risks facing the HSCP. The following table summarises the assessment of perceived residual risks:
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2 Residual Risks Very High High Medium Low Total June 2022 4 14 6 - 24 June 2023 4 13 7 - 24 June 2024 5 15 1 - 21 August 2025 6 15 0 - 21 February 2026 5 15 1 - 21 June 2026 5 15 - 1 21 The main issues identified through this review of the risk register are: • Safety of services (SRR14) is considered a ‘High’ risk that is perceived to have increased as a consequence of long term absence within the management team who oversee Children’s and Family services. It is not suggested that this is increased to ‘very high’ at present as: o Recruitment to a temporary head of service post is underway o Additional support is being provided to the team o Clinical governance processes are being actively reviewed to ensure risks are understood and managed in an improved way. • The impact of the conflict in the middle east is recognised in a number of risks. It is anticipated that there will be inflation associated with this that will have financial impacts on the HSCP and it will add to the impact of the cost of living crisis within communities (SSR 21). • The SRR recognises that the new JSP has been approved and that this now aligns better to the operational and financial context facing the HSCP. • The Partnership Working risk is being held under review as requested. Working relationships remain positive with both partners and relationships with Greater Glasgow and Clyde remain professional. Joint working groups have been established to improve governance relating to the SLA costs and activity. (SSR 6 – High) • The HSCP is investing in engagement, this includes management team training, additional support from HIS and the recruitment of a new post to improve expertise and capacity. These actions are designed to reduce the risk associated with engagement which include reputational damage, poor decision making and
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3 legal challenge. Relatively high participation and media coverage of IJB decisions would suggest that the approach being taken is potentially reducing the engagement risk associated with low participation, however, it is suggested the rating is held as High due to the difficult nature of engagement. (SSR 12 – High) • Risk in respect of the GP contract is perceived to be reducing and moves from ‘Medium’ to ‘Low’. Investment in new primary care services is underway and there appears to be general acceptance that the initial expectations regarding primary care improvement will not be met in full as resourcing from the Scottish Government is insufficient. (SSR 17 – Medium to Low). 3.2 The risk register incorporates an indicator which illustrates the perceived direction of each risk, the five ‘Very High’ risks are: Financial Sustainability (SSR01) The budget gap in 2026/27 is substantial and deteriorates further in future years. The savings plan requires service reductions and there is the additional cost associated with the Glasgow SLA. The External Auditor has raised finance as a risk to the IJB and Audit Scotland consider it to be a risk across the sector. The NHS budget in particular is not balanced on a sustainable basis, available reserves are being used to fund the shortfall in the current year. Sustainability of Commissioned Service Providers (SSR08) Risk remains very high as service providers continue to struggle to recruit staff and deliver the services they are contracted to. Several are requesting unaffordable uplifts. The increase in the employer national insurance rate has added to pressure and HSCP service reductions (care at home, 3rd sector support) will increase the risk further for some. The HSCP is engaging with providers to ensure impact assessments are realistic and fairly represent this risk. Additionally, a care at home provider is in the process of winding up with the HSCP stepping in to deliver services directly in some localities (via agency staffing and re-deployment). Workforce Recruitment and Retention (SSR11) The HSCP continues to experience difficulty in recruiting staff to a variety of roles. This is a constraint on service delivery in some areas and results in extra cost and risk. The ageing population and housing emergency contribute to an increasingly difficult local context. The workforce group is in the process of implementing the Workforce Strategy and key worker accommodation options are improving in the most challenging localities. Overall the perception is that the problem is slightly improving in respect of the Health Service but not in respect of Social Care services in the west area and some islands. Socio-Economic Situation & Increasing Poverty (SSR21) This risk continues to be considered as very high and has multiple strands. It is largely outwith the influence of the HSCP. It is expected that the cost of living crisis will continue to drive increased poverty and deprivation and service demand. Recent public health publications and performance data support the evaluation. Addressing health inequality is a strategic objective for the HSCP and Government (Population Health Framework) but it is not clear that there is additional resource to support the envisaged shift in provision. Inflation (energy
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4 costs in particular) are expected to remain high / increase due to the conflict in the middle east. This risk is likely to remain high for some time. Infrastructure and Assets (SSR07) Significant backlog maintenance requirements have been identified, there is insufficient funding available. Some capital has been allocated and progress has been made in addressing the highest risks. There are excess requests for equipment replacement across the NHSH area and insufficient funding for digital infrastructure replacement and development. This risk, to a large extent, is not in the control of the HSCP and is the responsibility of partners. The risk of building failure is perceived to be increasing but there is an improved understanding of the problem and steps are being taken to address the areas of most concern. Relationships with partners are positive and some projects are now progressing. There is insufficient budget to maintain all properties to an acceptable standard in the longer term and spend is increasingly targeted at addressing issues raised by regulators and the Fire Service rather than upon the suitability of facilities. 3.4 Risk management relies upon processes and procedures within the partner organisations, particularly in respect of cyber security, data protection, infrastructure replacement and financial processes and systems. Recent Cyber Security breaches highlight the strategic nature of this risk. It is also the case that the actions that the HSCP is taking to deliver financial improvement can be expected to have further negative impacts on a range of strategic and operational risks, particularly as spend on social care services is reduced. Action is necessary to manage financial risks and respond to the expectations of partners. 3.5 Audit Recommendations The Risk Management Strategy has been reviewed recently and risks have been mapped to strategic objectives. A focus of activity at present is to develop operational risk registers to ensure that they are consistent and complete. 3.6 Risk Appetite An IJB development workshop was held in October 2023 to set the risk appetite for the HSCP. The main purpose is to ensure that the management understanding of risk appetite aligns with the IJB’s, the first iteration and adopted risk appetite is below: RISK APPETITE RATING Risk Grouping 1 2 2.5 3 3.5 4 4.5 5 Operational Risks Strategic Risk Legal / Regulatory Financial Development & Innovation Clinical & Care People & Workforce Reputational
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5 A review took place as part of the Board Development event on 10 December 2025, attendees were encouraged to complete a survey to enable the risk appetite to be updated with a second attempt to improve the response rate in early 2026. The responses are summarised below, based on 4 IJB members completing the survey the second time round. These suggest a reducing risk appetite: RISK APPETITE RATING Risk Grouping 1 2 2.5 3 3.5 4 4.5 5 Operational Risks Strategic Risk Legal / Regulatory Financial Development & Innovation Clinical & Care People & Workforce Reputational The risk appetite ratings quantitively indicate that there is a willingness within the IJB to accept higher risk relating to strategic change and innovation. This reflects a recognition that there are significant drivers for change and transformation. It is also clear that the IJB has a lower appetite for clinical, legal / regulatory and financial risks. Members may wish to consider if the current risk appetite should be retained until the next review given the low response rates. Despite this, it has been a worthwhile exercise to reconsider the approach to risk management. 4. RELEVANT DATA AND INDICATORS 4.1 The identification and rating of risk is based on internal and external data and indicators as well as a wider environmental scan. 5 CONTRIBUTION TO STRATEGIC PRIORITIES 5.1 Robust risk management is an important aspect of the overall strategic management of the HSCP. This report also seeks to ensure that risks relating to strategic objectives are adequately reflected in the SRR. 6. GOVERNANCE IMPLICATIONS 6.1 Financial Impact – This report outlines a need for the HSCP to change the way it operates in order to remain financially sustainable. 6.2 Staff Governance – the risk environment suggests a requirement for change that will likely have staff governance implications. 6.3 Clinical Governance – There would be potential impact in clinical/care delivery as a consequence of the management of the risks outlined in the SRR. 7. Professional Advisory 7.1 Professional leads are embedded in operational and strategic risk management processes.
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6 8. EQUALITY & DIVERSITY IMPLICATIONS 8.1 None arising directly from the contents of this report. 9. GENERAL DATA PROTECTION PRINCIPLES COMPLIANCE 9.1 None directly but data protection compliance is an important business risk. 10. RISK ASSESSMENT 10.1 This report provides a detailed review of the strategic risks facing the HSCP. 11. PUBLIC & USER INVOLVEMENT & ENGAGEMENT 11.1 None arising directly from this report. 12. CONCLUSIONS 12.1 The risk environment facing the HSCP remains challenging as financial pressures continue and the impact of service reductions are being experienced. Finance and staffing related issues continue to be amongst the main challenges. The local assessment aligns well with the national picture with recent reports published by Audit Scotland providing evidence. There is a concern that some of the recent policy and legislative requirements will further exacerbate workforce and financial risks and are not supported with financial investment. Finance and staffing constraints in turn drive many of the other key risks such as waiting times, safety of services, community engagement and culture. 13. DIRECTIONS Directions required to Council, NHS Board or both. Directions to: tick No Directions required √ Argyll & Bute Council NHS Highland Health Board Argyll & Bute Council and NHS Highland Health Board 14. PREVIOUS REVIEW OF THE REPORT Meeting Title of report Date Output (if relevant) SLT Strategic Risk Register 10/6/26 TBC REPORT AUTHOR AND CONTACT James Gow, Head of Finance : james.gow@argyll-bute.gov.uk Appendix 1: Strategic Risk Register