Transcript Zurich Municiapl - Worlds Apart

Worlds apart
The 2016 Senior Managers’
Risk Report
David Forster
Head of Risk, Zurich Municipal
Kevin Morris
Regional Manager, Zurich Municipal
Our fourth report
Cumulatively, covering conversations
with over 60 Local Authority CEOs
(and some Leaders)
Many thanks to all for the candid
and comprehensive viewpoints
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“It is the best of times and the worst of times”
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WEI-CHI
Chinese word for chaos ‘wei-chi’
Two words meaning danger and opportunity reflects to two worlds of local government
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The many worlds of local government
 For some it is change or bust – they see opportunities at every turn
 Some are struggling with community sustainability and funding black holes
– they may not succeed
 Risk taking is now the default position – a new breed of risk managers is needed.
“We have to learn to
take risks and accept
that s*** happens”
“Taking on more risk
is not a bad thing”
“We have to have a
‘bring it on’ attitude”
“For government to
react a council has to
go bust”
“Forty years of
tackling inequality
has made little
progress. We have
to ask ourselves are
we doing the
right things”
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CEOs believe local government has been too good at its job
 Councils have delivered, yet are only 50% through the cuts
 CEOs managing a new norm which is ‘volatile, uncertain, complex and ambiguous’
 Some predict a breakdown in civil order
 CEOs are leading unique culture shifts
‘The goal is getting people to change because they want to, not because they have to’
 New skill sets needed for CEOs
‘We need people, facilitation, negotiation and team work skills’
 CEOs know they are missing opportunities; asking where they can share
‘Ideas and insight’
‘CEOs have to absorb uncertainty and project certainty’
‘Leadership is not about the traditional triangle. I am at the bottom of an inverted triangle.
I support frontline staff.’
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Austerity and opportunity
 Many see 2016-2017 as a tipping point
“We will not have enough money to fund mandatory obligations
in the next 18 months. We have explored every angle possible to
prevent Section 114”
 Evidence that some local authorities will be declared
unsustainable in 2017
“It’s no longer about how we can save money, but how can
we raise income”
 Most believe sustainability is only achievable through growth
– Brexit may slow growth
 For some, self funding is an impossible dream
 Whilst ‘worlds apart’ in many ways, Scotland is coming closer to
England in terms of the financial challenge
“It now feels incremental change will not be enough –
we need to move to transformational change…
translate rhetoric into pragmatic plan.”
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Collaboration and innovation
 The difficulties of living in a world with old fashioned governance
and infrastructure trying to meet modern challenges
“The public services structure is a ludicrous way to
deliver prevention”
 Rise of the whole system approach
“We are recalibrating our relationship with the community
and the voluntary sector”
“I worry more about the risk in partner organization than my own”
 Shared services have their challenges
“Shared services must prove long term viability”
 Asset sharing is seen by some as…
“A massive missed opportunity”
 Customer centric community engagement
“Sometimes locality is just one street”
 The role of Districts in demand management
“It’s not about doing to people but about
working with people.”
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Devolution
Reflects the many worlds of local government
–critical to some, a distraction for others
 For some an aspiration, others see it as fundamental to
a successful future
“Devolution offers the responsibility, but only part of
the funding”
 Devolution deals are good for growth but there remains
a reluctance around structures and governance
“Form should follow function”
 Combined authorities are springing up everywhere
– the biggest challenge for many will be cultural integration
“The devolution agenda risks a war between the two tiers”
“Increased scale can result in arrogance, remoteness
and alienation”
“Smaller authorities lack resilience.”
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Climate change
Climate change and sustainability have taken
a back seat in recent years, but this is changing
 Winter flooding has raised the profile of this issue for many
“It’s not a question of if, rather when”
 Piecemeal approaches in recent years generate criticism from CEOs
“We’ve lost sight of climate change and loss of biodiversity
These long term issues do not sit well with budgetary challenges”
 Climate change is the number 1 global risk and local authorities
are starting to take the long view again
“How are we going to manage and mitigate climate change?”
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Integration – health and social care
 Failure in social care is still a nightmare for CEOs
“One of the things that keeps me awake at night is
a child related incident”
 Scotland and Greater Manchester are now live
“Local authorities are now social care organisations
and business funds social care”
 Health and local government work to different business models
“We need to design a health system that is solvent, clinically
sustainable and effective”
 Local government leading on integration and bearing the brunt of the
integration risks
“I have to help health be more effective”
 Challenges around ownership, responsibilities, accountability culture
(and liabilities)
“Health and social care requires a complete change
of commissioning.”
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Prevention
 Prevention is not just key to health and social care reform but to all
areas of public service
“The objective is to empower people to take care of themselves”
 Many talk of demand management- based on a better understanding
of the drivers of demand to reshape services
“Prevention is the holy grail”
 Prevention is not just key to health and social Predictive analytics
– in its infancy
“The prevention agenda and analytics, are not going to benefit
adults in the short term”
 Some are not sure that it will deliver the savings which are so
desperately needed
“Prevention may not save money, it may just move the cost
to later in a person’s life.”
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A new world order
Many areas need investment to achieve the goal of growth
 Extraordinary commercialism underpins ambition- members need
to be convinced
“We need to achieve resilience through enterprise”
“Our growth strategy means reinvesting income locally”
 Homelessness is a massive challenge in London and the South East
 Impact of Brexit on EU funded projects, in particular in Scotland
and Wales
 Wales; local government reorganisation has stalled
“We’re heading for a perfect storm”
“We’ve swopped Cardiff for Westminster.”
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Final thoughts
‘What happened? How did we let this happen?
 Community cohesion at risk as austerity continues to bite
“Society as we know it might start to break down”
 Local government is straying into new areas and the risks
are different
 Risk management has turned on its head – from risk avoidance
to risk taking
 Risk professionals need to be business advisors, analysts,
presenters, negotiators, facilitators and challengers. This is a
pivotal point for the risk world
“The risk manager must understand the golden thread
– the strategy and how it runs through the organization”
 Will there be an economic slowdown as a result of Brexit?
Will it challenge the growth driven agencies, fundamental to
the survival of most local authorities?
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Thank you
for listening
Any questions?
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