Continued failure by councils to embrace risk threatens to waste opportunities in galvanising communities to run local services, a report launched at this week's SOLACE summit in Edinburgh warns.

Entitled ‘Risk and reward' the joint paper - from think tank the Local Government Information Unit (LGiU) and insurer Zurich -  argues a more strategic approach to risk which embraces community involvement could deliver better services and increase cost efficiencies.

But the survey of council leaders, chief executives, cabinet members and policy leads from over 90 councils showed almost all local authorities (99%) have no specific strategy in place for managing risks associated with the community right to challenge and right to buy.

Exactly half of councils questioned (50%) agreed they are ‘risk averse' or very risk averse' and a clear majority of nearly two-thirds (64%) expressed themselves sceptical on the capacity of local groups to run services or manage assets.

Over two-in-five councils (41%) said they were unlikely to take any risks in commissionng children's services and just under a third (29%) reported the same for adult social care.

Jonathan Carr-West, policy director at LGiU said it was understandable why councils are unwilling to take too many risks with services which have a real impact on people's lives.

But he warned the combination of fiscal austerity and long-term socio-economic and demographic pressures means ‘that we cannot continue to deliver public services in the same old way.'

‘These are not challenges we can opt out of and we need real innovation.  In this context, risk avoidance may be the riskiest thing of all,' he continued.