Agenda Item: / 3
Paper No: / CM01/12/01

MINUTES BOARD MEETING IN PUBLIC

FINSBURYTOWER

16 November 2011

13.30 – 15.40

Present
Jo Williams / Chair
Martin Marshall / Commissioner
Kay Sheldon / Commissioner
Professor Deirdre Kelly / Commissioner
John Harwood / Commissioner
In attendance
Cynthia Bower / Chief Executive
Peter Tindall (deputising for Amanda Sherlock / Deputy Director of Operations
John Lappin / Director of Finance and Corporate Services
Jill Finney / Director of Strategic Marketing and Communications (joined the meeting at 09.35)
Louise Guss / Director of Governance and Legal Services
Philip King / Director of Regulatory Development
Richard Hamblin / Director of Intelligence
Allison Beal / Director of Human Resources
Alastair Cannon / Head of Governance
Jerina Brown / Corporate Secretary
Amanda Hutchinson / Head of Better Regulation (attended the meeting for item 9)
Victoria Carson / Chair’s Communications Manager

Agenda item

Item 1 – Welcome and Apologies

  1. Apologies had been received from Amanda Sherlock, Director of Operations.

Item 2 – Declaration of Commissioners Interests

  1. There were none.

Item 3 – Minutes of the meeting held on 14 September 2011 (Ref: CM/06/11/01)

  1. Page 5 para 36 insert full stop at the end of the second sentence; page 7 para 52 first sentence insert the words “a role in” after “…HealthWatch would have…”.

Item 4 – Matters Arising and Action Log (Ref: CM/06/11/02)

  1. A question was asked whether following the last meeting members of the public had email CQC regarding HealthWatch. It was agreed a check would be made and Board members advised.

ACTION Board to be advised whether any emails had been received from the public concerning HealthWatch following the 14 September Board meeting – Director of SMC

  1. The Board asked for an update on the planned research into the regulatory approach taken in the ‘five nations’ and whether any learning points had been identified. This work remained to be done however it was agreed an update would be provided to the Board on this work.

ACTION: Update to be provided to the Board in May 2012 on the work to look at the regulatory approach taken in the ‘five nations’ and possible learning points for CQC – Director of Regulatory Development

Item 5 – Chairs & Commissioners’ report (oral)

  1. Professor Kelly provided the Board with a report on the proceedings of the Audit and Risk Committee meeting which took place on 19 October 2011.
  2. She highlighted the following points:
  3. The Committee had agreed the extension of Nigel Freeman’s contract as the Head of Internal Audit to 31 March 2013. The Committee in doing so had reviewed the quality of work the new in-house team had provided and considered it to be of high quality.
  4. Three Internal Audit Reports from the annual programme had been published of which one had received substantial assurance with the other two receiving partial assurance as follows:
  5. Bringing of Non-registered Providers into Regulation – Partial Assurance
  6. Board and Director Expenses, Payments and Benefits and the use of Government Procurement Cards – Substantial Assurance
  7. Management of Safeguarding Disclosures and Formal Whistle- blowing Referrals received by the Commission from External Sources – Partial Assurance
  • The Committee has been satisfied that a comprehensivemanagement action plan had been drawn up. The Committee would take a particular interest in the planned follow-up audit of Safeguarding and Whistle-blowing.
  • The Committee had observed that the risk management framework implemented in April 2011 was evidently now a live management tool which continued to be embedded into the organisation. The Committee had instituted a routine of inviting Directors to the Committee to describe how they operate the framework in their area of the business.Regarding management of regulatory risk, the Committee had asked for further information and assurance about the patterns and themes emerging; this was now being addressed.
  • The Committee had been pleased to note that the work in hand had meant that the risk to the delivery of mental health operations modernisation was now rated green; however despite the very encouraging progress to increase the supply of Second Opinion Appointed Doctors, the performance on the provision of opinions continued to warrant a red risk rating.
  • The Committee had thanked the outgoing Chair, Olu Olasode, for his contribution to the Committee.
  1. Kay Sheldon asked how it was decided which internal audits were conducted. The Committee chair explained that this was donein accordance with the programme of audits agreed by the Committee, which was reported upon at each Committee meeting. The programme was devised, with the external auditors, in light of the risks identified via the risk framework. The scope of the programme was devisedto ensure that the programme would generate assurances to allow the Accounting Officer to sign a statement of internal control. It was agreed that the current audit plan would be circulated to the Board

ACTON: Current Internal Audit plan to be circulated to the Board – Secretariat

  1. John Harwood provided a report to the Board of the first meeting of CQC’s Stakeholder Committee held on the 17 October and formally submitted the minutes of the first meeting.He thanked the Public Affairs team for their work to ensure a smooth transition from the predecessor Provider Advisory Group to the new Committee.
  2. He reported that it had been a constructive meeting with the membership selected to best reflect CQC’s stakeholders; the membership was more broadly based that its predecessor. He explained the Committee had discussed the care market and how it is shaped by commissioning, and as a result, wished the Board to consider whether it could, or should, work with other interested parties to explore how the shape and structure of the care market influences the provision of high quality of care.
  3. The Chair noted that there was potential merit in CQC undertaking this work as it could inform the State of Care report;a scoping paper might be helpful.
  4. On this point the Board members made the following comments:
  • Whilst there might be merit in doing such work it would be necessary to see what the possible costs and risks might be alongside the benefits;
  • That the scoping paper would need also to make clear the capacity of CQC to take on the work, given the existing priorities for delivery.

ACTION: Scoping paper on Quality of Provision and the structure of the market to be prepared, including potential risks and benefits to be considered by the Executive Team and then the Board in advance of the February Stakeholder Committee meeting – Director of SMC

  1. Kay Sheldon asked about the links between the Stakeholder Committee and the Board; she pointed out that she had not been aware that the new Committee was due to meet, and stated that the Board was responsible for approving the membership and Terms of Reference of its committees. Kay expressed concern that the creation of this Committee had resulted in the abolition of other groups and that now some stakeholders had been ‘cut out’ resulting in inequity for those who use services.
  2. John Harwood apologised if there had been a lack of awareness about the date for the first meetingThe Terms of Reference and membershipwould be circulated; at the first meeting it had been agreed that these would be reviewed after a year. The aim was that the Committee would be abody which the Board could consult. He pointed out also that in line with a paper previously put to the Board a register of stakeholders had been drawn up; there remained numerous advisory and reference groups and a list of these was being prepared.
  1. Kay Sheldon remained concerned that the membership of Stakeholder Committee did not satisfy the CQC duty to involve. The Director of Strategic Marketing & Communications pointed out that CQC had numerous mechanism of involvement and that the Stakeholder Committee was not devised to meet CQC’s duty to involve rather it was to engage stakeholders. She undertook to bring a paper to the Board which detailed both the involvement and stakeholder work of CQC.

ACTION: Terms of Reference and membership of the Committee to be circulated to Board members for approval - Secretariat

ACTION: A paper to be brought to the February meeting to provide a composite picture of the CQC user involvement and stakeholder engagement – Director of SMC/Director of Regulatory Development

Item 6 – Chief Executive Report (Ref: CM/06/11/05)

  1. The Chief Executive provided her report to the Board to update them on a selection of developments and key issues not otherwise covered in the Board agenda.
  2. The following points were highlighted:
  3. The investigation report had been published into Barking, Havering and Redbridge University Hospitals NHS Trust (BHRT). Serious problems had been identified in respect of the quality of care being delivered.
  4. A decision has been taken to align CQC’s regions with those announced by the NHS Commissioning Board and the DH Social Care, Local Government and Care Partnership Directorates; this will reduce CQC operational regions to four. The Director of HR is leading project to implement this change.
  5. The recruitment of inspectors had been oversubscribed with candidates waiting to join as vacancies arose. It was noted that candidates who had applied were from a variety of backgrounds including both health and social care.
  6. With the imminent departure of the Director of Intelligence, external consultants have been commissioned to undertake a review of the information management processes and internal structures to ensure they are aligned to deliver the changes and challenges ahead.
  7. The Chief Executive drew attention to the section in her report detailing the outcome position for those homes previously owned and or operated by Southern Cross.

Item 7 – Performance Report Quarter 2 (Ref: CM/06/11/08)

  1. The Director of Finance and Corporate Services presented this report to the Board which set out the achievements of the organisation against the agreed measures and targets of performance.
  2. Overall, the quarter had seen a number of positive performance improvements, notably in registration performance against the 8 week target, in the number of compliance reviews completed.
  3. Compliance performance out-turn for end of March is scheduled to be 100% of NHS provider reviews, 62.5% of ASC and IHC locations with 15% of Dental practices receiving a review by March 2012.
  4. It was reported that the rollout of desktop operational management information to the Executive Team and Heads of Service had commenced with full rollout across Operations due to be completed by the end of November.
  5. There had been a significant increase in the number of enforcement action Warning Notices issued during the quarter – 229 compared to 43 in Q1. This was in part due to increased compliance activity, including the enforcement action following the first round of DANI inspections to check on providers not compliant, and locations where there had been repeated non-compliance by providers.
  6. It was commented that the use of Warning Notices had been an extremely useful tool in respect of health services. The impact of Warning Notices would be looked at as part of evaluation being undertaken by the Director of Regulatory Development.
  7. There had been a 28% positive variance in the budget in Quarter 2; the forecast was that this would result in a year end under-spend of £10M. Although progress had been made on recruitment, the level of vacancies had contributed to a significant underspend on staff costs in the quarter. The constraints on consultancy spend also comprised a significant percentage of the under-spend.
  8. The report highlighted areas for improvement which include the level of usage of Experts by Experience and numbers of SOAD opinions delivered to the statutory timescale. However it was noted that there were initiatives underway to improve performance in these areas.
  9. The performance on production of draft and final compliance reports remains red but action is being taken to improve the process,including changes to the mechanics of the report writing process to support a quicker turnaround.
  10. The Chair asked about the trial of software to automate analysis of information and feedback accessible to CQC about care prevision and experience and whether work could be accelerated to utilise the forecast under-spend.The Director of Intelligence explained that the evaluation was positive and a full business case was being prepared for approval. It was felt that the opportunity to drive forward this work in the current financial year should not be lost.
  11. The Board asked about:
  • Theproportion of the budget under-spent and how this would impact delivery;
  • Whether the application of resource across health and social care was suitably balanced;
  • What percentage of the under-spend was due to being below headcount?
  • Given the under-spend whether seeking additional funding from the DH next year was necessary.
  1. The Director of Finance and Corporate services explained the under-spend had occurred primarily because of two issues, a) the freeze on recruitment and b) constraint on the use of consultancy. However CQC would require additional funding to cover the full- year costs of the additional staff and therefore had asked the Department of Health for £10M in respect of 2012/13 which fitted in with the DH’s forecast. It was noted that fees would go up in 2013/14.
  2. The Chair commented it would be important to use the budget in full in 2012/13 with an ongoing process for regular recruitment, and that the distribution of compliance resource likely would be taken up in the evaluation work to be discussed later in the meeting.

Item 8 – Strategic Risk Register (Ref: CM/06/11/07)

  1. The Chair commented that there was planned a Board workshop on risk in December to fully review the strategic risk register. It was noted that there had been a reasonable start on capturing the risks to achieving the strategic priorities. However much had happened since April. It would be sensible therefore for the Board to spend some time collectively to focus the current strategic risks.
  2. It was noted that some of the mitigating actions which were discussed at the Audit and Risk Committee, required updating, and that many of these were more a description than a proper evaluation.. The workshop would be an opportunity for the Board to consider also the relative roles of the Board and Audit & Risk Committee in relation to the register.
  3. The Head of Governance reminded the Board that only lately had the scheduling of Committee and Board meetings been aligned to allow the Committee to examine the strategic risk register of behalf of the Board – this should deliver benefits in future in the form more rigorous scrutiny of the risk register ahead of Board meetings. He noted also that having the strategic risk register as a public document was an important facet of CQC’s openness. Despite the consequence of attracting some misleading media comment at the time of first publication, the recent criticism of another public body by the Information Commissioner for failing to make their strategic risks public had demonstrated that this was the correct decision.

Item 9 – Evaluating CQC’s Approach to Regulation and Developing as a Learning Organisation (CM/07/11/12)

  1. The Head of Better Regulation joined the meeting for this item which had been intended to be taken in the private session of the meeting, but on reviewhad been added to the agenda for the meeting in public.
  2. In presenting this report to the Board the Director of Regulatory Development explained the intention to work with a partner organisation over the long term toevaluate the impact of CQC’s regulatory activity. This would include:
  • a comparison between what CQC does with the activities of the predecessor bodies;
  • an evaluation of CQC’s deterrent function;
  • An evaluation of the impact of CQC’s involvement work.
  1. The Head of Better Regulatory explained that the views of the Board were being sought specifically on:
  • The proposed areas of evaluation;
  • The proposal to work with an external body and to obtain input from providers;
  • The planned steering group.
  1. Martin Marshall stated he very much welcomed and supported this work, both the intent and the proposed approach. It should be sure to becomprehensive and have the external input to help ensure objectivity: the right questions should be asked although the Board should be aware but also accept there was some risk in asking them. To be successful the work would need to adequately resourced; having a steering group was important Martin Marshall indicated that he was willing to become involved and help shape the work. This was welcomed.
  2. Kay Sheldon observed that patients/user should be involved in evaluation; in addition the work should look at the patient/user experience of regulation for example how well inspectors talked to users.
  3. Professor Kelly also supported the work and reiterated that having external input was important for objectivity, and more broadly it was important to have the right people on the steering group.
  4. The Chair endorsed the points made and added that it was important that CQC could demonstrate how it added value and the difference it made to peoples’ lives. It was important also that CQC it could answer its critics.The Chair asked about timescales and budget.
  5. The Director of Regulatory Development stated that a start had been made on planning and that an approach would be made to the DH to obtain permission to spend money on obtaining external expertise to assist with this work.
  6. The Chair sought Board members views on governance for the proposed work. The Board were unanimous that given the strategic nature and importance of this work the steering group should report to the Board.

AGREED: The Board agreed the following: