CFA Variations - FAQs

  • How do we control funding once funds are incorporated with CFA?
    Generally, a Direct Contract is appropriate when the Ministry wishes to maintain key control of the service and use of funds.A CFA variation is appropriate when the Ministry/Directorate is ready to completely devolve the funding/service requirements within 3 years. Devolved services means that the responsibility for funding has been transferred to the DHB by Order in Council or by agreement between the Ministry of Health and a DHB. Therefore, once incorporated into the CFA, the business directorate will have less control over funding.
  • How do we ensure that funds given to a DHB/provider are used for our programme?
    Through the reporting requirements - this essentially sets out how the Ministry will monitor DHB delivery of the services in the variation. You may wish the DHB to provide you with reports such as quarterly updates on progression of the initiative, or in any manner that is most appropriate for the service. Without some measure of feedback, it may be difficult to formally ascertain how the DHB is performing in respect of your initiative/service. However, reporting requirements should be balanced against the need to keep the compliance costs for the DHBs to a minimum.
    If reports are required, reporting should be through the Quarterly Reporting process administered by the Monitoring Team, DHB Performance, Funding and Monitoring (contact Reporting and Monitoring Advisor Darryl Oldfield). This ensures that a formal reporting is clearly documented by way of the Quarterly database. Performance failures are also easier to highlight via this process.
    If the reporting requirements are to be via Sector Services, you need to check whether this will be standard reporting or new reporting is to be created. DHBs may incur a cost to obtain the information required to report on your variation.
  • Do we have the ability to withhold or clawback funds in the event of service non delivery?
    Yes, you can include clawback or wash-up arrangements for non-performance that are necessary in the funding section of your schedule.
  • Who has access to the CFA Variation Tracking database?
    Variation owner, CFA Coordinator, budget authoriser, group manager, Health Legal solicitor, Reporting Requirements coordinator, DHBFinancial advisor - anyone who is helping to write/review the variation can be granted maintainer rights.
  • How do we determine the payment methods once funds are incorporated within CFA?

If funding for a new initiative is for a fixed duration, funding to DHBs should be by invoice and therefore not included in Schedule B (the payments schedule) of the CFA. Variation Owners need to decide what payment intervals they wish to supply. Business Units will be required to process and ensure payment is made to the DHB in a timely manner on receipt of a valid invoice and signed CFA variation.

If funding for an initiative is ongoing, payment should be via Schedule B. Funding will only be incorporated at the next scheduled update of a Schedule B once a Purchase/Funding Board has approved it and the CFA variation is signed.

  • Could we use CFA to improve the transparency of the subcontracting arrangement with CHL?
    One of the main reasons to vary the CFA is to maintain transparency when amending funding or service requirements to an existing service or output. Variations include, but are not limited to: new Government initiatives, pilot programmes, and changes to service coverage requirements. CFA variations are required even if the variation does not have a funding change, for example, changes to service coverage expectations or operational policy requirements. CFA variations in these cases ensure transparency and accountability.
    I’m not sure how transparent the current subcontracting arrangement is with CHL, but the nature of a CFA variation is very transparent. It is overseen by a number of SMEs within the Ministry and NHB to ensure DHB accountability and statutory compliance. Health Legal also checks individual variations to ensure CFAs are sufficiently robust, unambiguous, and do not expose the Ministry to legal risk. To that end, when drafting your schedules make sure that the service description (what) and the service requirement (how) are specified and succinct. This reduces the possibility of different interpretations by relevant parties.
  • How do we amend/include PUC codes within NFSL Data Dictionary?
    If the team want to amend any of the PU Code details, they need to agree the changes within their team and follow appropriate internal team sign off processes before the proposed changes are sent to Emily Black, Purchase Unit Advisor. They can then process the changes through the normal PUDD change process that happen twice a year in June and December.
  • How do we monitor quality standards once a service is included with CFA?
    CFA variations must comply with certification/exception reporting and be administered through the DHB Quarterly Reporting Database. Most reporting should be six-monthly or annually, with more frequent reporting by exception only (e.g. high risk or by Ministerial or Cabinet direction).

Once the frequency of reporting has been determined, milestones/targets should be negotiated with the DHB for the certification reports. These must directly relate to the service requirements in the CFA variation. The DHB will certify that the milestones/targets have been reached in a simple report through the DHB Quarterly Reporting Database.

If the DHB does not meet the agreed milestones/targets, an exception report will be required. Generally, an exception report should contain information on:

•the reasons that the milestones/targets were not met

•the resolution plan or process that will be implemented to meet the milestones/targets

•a time frame for meeting the milestones/targets.

All information required in the exception report should be detailed in the reporting clause of the CFA variation.

Additional reporting requirements may be required in rare cases. This is reporting that does not comply with certification/exception reporting. This must be justified in the Business Case. Justification for additional reporting may include Ministerial or Cabinet direction or where reporting is directly linked to payment of funding.

The level of authority required for certification will take account two main factors, total funding allocation and risk of non-delivery or poor performance. Ultimately, it is up to the Variation Owner and their group manager to decide the appropriate governance level required for the certification report.

There are instances where a report is considered an output (or deliverable) and would not fall under these guidelines. This may include business cases or reporting that is linked directly to payment of funding. In this case, the DHB must be allocated sufficient funding to deliver the reporting as an output requirement of the CFA Variation.

  • Does the CFA give us flexibility to change service specs, reporting, monitoring and quality standards?
    A Service Specification must be completed and a fully defined purchase unit code allocated before funding is devolved. The service requirements must be developed sufficiently in the variation schedule for the Ministry to enforce compliance.

Service Specifications are developed by sector experts to describe the minimum level of a service to be provided. If your service requires the development of a service specification, or if you are unsure whether a nationwide service specification is required, contact the Service Specification Advisor (Jane Craven) in the first instance. The Service Specification Manager will ensure that due joint approval processes are followed for a nationwide service specification. TheOperational Policy Frameworklists requirements for service specifications.

  • How would we handle project (quality improvement, clinical studies) within the CFA?
    This is up to your team, but the Variation Owner’s responsibilities for executed variations are outlined below:
  • Respond to and resolve all DHB queries (DHB Relationship Managers can assist if required)
  • Provide feedback on DHB reporting within specified timeframes
  • If payment is by invoice, ensure invoices are received and paid according to the payment terms of the CFA Variation
  • Ensure funding allocations and service requirements of DHBs are resolved upon expiry of the CFA Variation (ie, funding is properly devolved, a new variation is executed, or services will no longer be funded or required
  • If the Variation Owner changes roles, delegate responsibilities and inform the CFA coordinator
  • Within the DHB, who has access to the CFA service specification and thus accountability for delivery?
    The CFA Variations (Omnibuses) are sent to the Contract managers/administrators or equivalent in each DHB, where the schedules within are forwarded onto the appropriate teams for review and approval. The Omnibus is then signed off as a whole by the GM or CE of that DHB. It is the Variation Owner’s responsibility to engage with the DHB and also notify the CFA Variation Coordinator of the contact person in each DHB (this will be noted in the CFA tracking database). The Relationship Manager must know who in the DHB to talk to.
  • When a service is contracted through the CFA from an Appropriation perspective, do those funds move to DHB Performance and Accountability or remain with the Business Unit, i.e. National Screening Unit?
    As mentioned in a previous answer, if the payment is by invoice then Business Units will be required to process and ensure payment is made to the DHB in a timely manner on receipt of a valid invoice and signed CFA variation. If it is through Schedule B (the schedule of payments through which Crown Funding, consisting of DHB Appropriation and any additional updates to the Cash Profiles), then payment is provided monthly to DHBs for the provision of devolved services.
  • What does a CFA service spec (schedule?) look like? ie can it have as much detail as you like?
    All templates can be found on the NSFL website. If you register your CFA Variation on time, you will receive a link to the template on the CFA tracking database where you can complete your draft schedule.

1