Contents
Page 4: Section 1: Financial Plan 2017/18
Page 6: Section 2: Financial Position at July 2017
Page 7: Section 3: Financial Position by Directorate as at 31st July 2017
Page 10: Section 4: Flexible Staff Costs as at 31st July 2017
Page 14: Section 5: Savings Plan Progress – by Directorate
Page 15: Section 6: Key Assumptions and Risks
Page 16: Section 7: In Year Position
Section 8: Recurrent Position
Section 1: Financial Plan 2017/18
The 2017/18 Draft Financial Plan was submitted to Department of Health and HSCB on 15th August 2017.
Trusthas published its proposals to meet its share (£13 million) of the overall HSC 2017/18 savings target of £70 million as approved by the Trust Board at its meeting on 24 August.
2017/18£000
Opening Trust Position / (27,754)
Add 2017/18 Pressures Identified / (27,061)
Total Projected Deficit (Excluding Funding, Savings, and Risks) / (54,815)
Indicative HSCB Funding / 22,359
Pharmacy Procurement Savings Target / 1,874
Remaining Gap (Excluding Savings, and Risks) / (30,582)
Low Impact Reduction Measures / 6,320
High Impact Cost Reduction Measures / 6,680
Remaining Gap (After Savings and Excluding Risks) / (17,582)
The Trust has assumed that all Transformation Schemes that were live in 2016/17 will continue to be funded into 2017/18. We understand that a range of these will be recurrently funded from this financial year.
With regard to all other Non-recurrent funds given in 2016/17 it is further assumed that these will be funded; such as:
· Elective Care
· Training & Education
· PHA Non-recurrent Income
A range of financial challenges are set to impact on the Trust during 2017/18 which will need managed in agreement with our Commissioners; these are:
· IR 35 increased rates
· Supporting People
· Unregulated Placements
In addition the Trust is aware of the following potential pressures arising in 2017/18 but will not proceed to incur expenditure unless specific additional funding is made available:
· Pay inflation
· Winter resilience
· Clinical Excellence Awards
· Children’s Residential Units – Regional Working Rota
The Trust submitted draft financial schedules to HSCB in mid-August 2017 which detail the position set out above and the Trust will continue to liaise with DOH and HSCB with the view to seek resolution of any outstanding financial gap for the year to 31 March 2018.
The Trust received funding schedules for Month 4 (July) confirming the recurrent baseline funding alongside new funds to address part of the projected deficit and new 2017/18 cost pressures. These are:
£m17/18
Contribution to opening Trust Pressures / 18,859
Non pay uplift 2017/18 / 3,105
National Living Wage & tariff uplift / 4,688
Demography 2017/18 / 6,074
Apprenticeship levy / 2,173
Totals / 34,899
Alongside this, a recurrent baseline funding retraction of £14.874m has been actioned by HSCB.
A further tranche of funding (circa £2.3m) is expected to be allocated to the Trust in line with indicative funding schedules provided by HSCB colleagues.
Section 2: Financial Position at July 2017
The Overall financial expenditure of the Trust can be set out as follows:
Year to March 2018Original
Annual Plan
£000 / Cumulative Actual
As at
Month 4
£’000 / Projected
2017/18
Income / NOT / 216,249 / 648,790
Expenditure / YET / 217,495 / 666,388
Pay / AVAILABLE / 144,684 / 436,818
Non-Pay / UNTIL COMPLETION / 72,811 / 229,570
Surplus / (Deficit) / OF THE TDP / (1,246) / (17,598)
% Surplus/(deficit) against RRL / (0.58) / (2.71)
The Trust has not yet received confirmation of allocations and consequently only year to date expenditure has been requested in the monthly monitoring returns.
Notes: The pay segment is impacted by the number of weeks which fall within the reporting month.
Section 3: Financial Position by Directorate as at 31st July 2017
This section details the financial position by Directorate/Division as at 31st July 2017 and includes an analysis of the main reasons for any over/underspends.
Division/Directorate / Budget / Expenditure / Mth 4 Variance / Projected Variance / Financial Plan 2017/18Required outturn
£000 / £000 / £000 / £000 / £000
Medicine & Emergency Medicine / 25,755 / 27,589 / 1,834 / 5,502 / 0
Surgical & Clinical Services / 36,553 / 36,877 / 324 / 969 / (1,000)
Community Care / 46,064 / 46,333 / 269 / 808 / 0
Women & Childrens / 32,824 / 34,021 / 1,197 / 3,586 / 0
Mental Health & Disability / 43,239 / 42,865 / (374) / (1,122) / (1,000)
Medical & Governance / 3,768 / 3,858 / 90 / 270 / 0
Nursing & User Experience / 9,142 / 9,166 / 24 / 70 / 0
Strategic Planning & Business Services / 2,333 / 2,333 / 0 / 0 / 0
Estates / 3,094 / 3,140 / 46 / 139 / 0
Corporate Overheads / 4,096 / 4,095 / (1) / (5) / 0
Finance / 2,835 / 2,837 / 2 / 5 / 0
HR / 1,628 / 1,600 / (28) / (84) / 0
Senior Directors/Chief Executive / 149 / 151 / 2 / 7 / 0
Corporate/Cost Pressures / 2,139 / 0 / (2,139) / 7,453 / 19,598
Totals / 213,619 / 214,865 / 1,246 / 17,598 / 17,598
Acute Division
(a) Medicine & Emergency Medicine
The projected deficit for this division is presented as £5.5m.
The main deficit areas are:
· Nursing £1.86m
Relates to agency costs to cover high level of absence and issues with recruitment. In addition the escalation of the bed numbers in the hospitals is reflected in the figures. ED in Causeway and Antrim are £1m.
· Medical £2.74m
Reflects locum costs associated with absence. Antrim and Causeway EDs represent £1.58m of the deficit. Causeway Physicians are £1.3m caused by a high level of Non-contract agency.
(b) Surgical & Clinical Services
The deficit for this division is presented as £969,000.
The main areas are:
· Nursing £523k
Relate to agency costs for the Surgical wards in both main hospitals.
· Pathology and Radiography surplus £576k
This area is currently under review; new management is challenging current processes.
Community Care
Deficit for the Directorate is £808,000.
The Directorate has a range of underspends which are mitigating pressures within the various sections.
The impact of 2017/18 demography on Placements and Domiciliary Care is currently under review.
Women & Childrens
The Directorate’s deficit is £3.58m. The main areas centre around:
· Residential Units which have a range of non-recurrent costs in the region of £1.6m
· Article spend equating to a variance of £1m
· Other Leaving and Aftercare issue £1m
Mental Health, LD & CWB
The Directorate currently has a projected surplus of £1m. This can be directly linked to
· A range of vacancies that the directorate has had difficulty in recruiting to.
Nursing & User Experience
The Directorate has a £70,000 deficit.
· Whilst there is an overspend in patient pathways as a result of increased usage of £500k, a range of underspends are mitigating some of these costs, including in year cost of vacancies which cannot be sustained in 2017/18.
Section 4: Flexible Staff Costs as at 31st July 2017
A significant factor for the Trust in recent years has been our reliance on flexible staffing. This can be analysed into 2 categories.
A) Agency/Locum/Enhanced Hours
The total spend in these areas is summarised below:
Division/Directorate / Cum to July 2017 / Cum toJuly
2016 / Movement
Agency (Medical) / Agency
(Other) / Bank / Overtime / Addit
Hours / Totals
£000 / £000 / £000 / £000 / £000 / £000 / £000 / £000 / %
Medicine & Emergency Medicine*** / 2,992 / 2,492 / 964 / 190 / 34 / 6,672 / 6,967 / 2,665 / 38
Surgical & Clinical Services*** / 918 / 854 / 594 / 432 / 162 / 2,960
Community Care / 2 / 364 / 1,374 / 231 / 165 / 2,136 / 2,429 / (293) / (12)
Women & Childrens / 535 / 676 / 572 / 177 / 69 / 2,029 / 1,080 / 949 / 88
Mental Health & Disability / 342 / 614 / 1,216 / 11 / 57 / 2,240 / 2,158 / 82 / 4
Medical & Governance / 55 / 9 / 18 / 17 / 99 / 95 / 4 / 4
Nursing & User Experience / 710 / 233 / 70 / 338 / 1,351 / 1,269 / 82 / 7
Strategic Planning & Business Services / 126 / 3 / 129 / 118 / 11 / 9
Estates / 89 / 30 / 43 / 13 / 175 / 127 / 48 / 38
Finance / 77 / 2 / 11 / 90 / 61 / 29 / 48
HR / 18 / 21 / 8 / 1 / 48 / 36 / 12 / 33
Senior Directors/Chief Executive
Totals / 4,807 / 6,078 / 5,002 / 1,187 / 855 / 17,929 / 14,340 / 3,589 / 25
***Note Medical/Surgical divisions were included in Acute Directorate
Medical and Agency spend is based on ACTUAL invoices in the Financial system. Accruals are separately included in the financial position where it is anticipated that spend may be missing. Note no financial position is produced for month 1 (April).
Expenditure on Flexible nursing is projected to be in the region of £20m in 2017/18 an increase of £3m on the 2016/17 position. However the main increase is directly linked to agency spend (as opposed to Bank, Overtime and Additional Hours) which is projected to be £9.3m compared to £6.8m in 2016/17. This is linked to
1. Difficulty in recruitment of nurses
2. Increased beds in Acute Hospitals
3. Absence levels
The recruitment of International Nurses should eventually reduce the spend for flexible staff; however it is anticipated that this will not impact until the latter part of 2017/18. To date, eleven international nurses are in training in the Trust (at Band 3 level).
Non-Contract Agency Spend
A monthly analysis is sent to Directorates identifying spend on agencies split between contracted (regional tendered) and off-contract companies.
Currently £2.6m has been spent on off-contract agencies for agency Medical locum while, for the same period, £2.8m has been spent on Non-medical agencies with the majority having been spend on Non-Contract Agency Nursing.
Consequently a total of £5.4m has been expended to dated which represents 49% of the overall total spend at March in these 2 categories of Temporary staff (ie of £11m spend).
As this spend is not governed by a Regional Tendered Contract (procured through PaLs), the Trust may be paying premiums significantly greater than expected under a regional contract.
The Projected spend on non-contract agencies in 2017/18 could be £16m which is £4.7m more than 2016/17 (41.5% increase spend).
Overall agency spend is projected to be £33m, which represents a £5.7m movement (21% increase).
B) Temporary Workforce
This represents staff who are on temporary contracts that are on the Trust payroll.
Based on the information within the ledger, spend on temporary employees, including the previous 2 financial years is as follows:-
Temporary Workforce / 15/16£000’s / 16/17
£000’s / 17/18 Projected
£000’s
At Month 4 / %
of total 17/18 spend
Band 1-4 / 5,306 / 4,988 / 4,911 / 1.12
Band 5-7 / 7,910 / 7,835 / 7,233 / 1.66
Band 8+ / 296 / 618 / 772 / 0.18
Non AFC Bands – Medical & Dental ** / 2,234 / 2,636 / 2,834 / 0.65
Total / 15,746 / 16,077 / 15,750 / 3.61
**The Medical & Dental temporary staff are on the Trust’s payroll on HSC terms and conditions, covering a mix of vacant posts, sickness, gaps in rota and additional duties. They include GPs,
retired staff, staff acting to a higher grade and staff appointed temporarily (as opposed to engaging an agency locum).
The projected spend for 2017/18 is similar to that presented in 2016/17 indicating that the Trust reliance on temporaries continues. This represents approximately 3.61% of the total paybill for the Trust.
The level of temporary AFC Band 8s in the organisation has grown since 2015/16 when the temporary workforce expenditure equated to 1.88% of all temporary spend; the projected position in 2017/18 is 4.90%.
Non AFC Band appointees represents 18% of all temporary staff expenditure.
AFC Bands 1-7 spend has decreased on previous years’ costs.
Section 5: Savings Plan Progress – by Directorate
The Trust has resubmitted a schedule of saving proposals for the 2017/18 financial plan.
Whilst these are currently in draft and the Trust is waiting an update from DoH/HSCB on their approval to proceed, we have been asked to prepare the necessary paperwork to consult on those which require public consultation.
The Proposed Savings plans, as detailed in the Public Consultation document, are as follows:
£000 / Impact
Classification
LOW IMPACT MEASURES
Non pay efficiency / 500 / Low
Repeatable contingencies / 800 / Low
Service development deferral / 2,025 / Low
Resettlements (Complex discharges Muckamore) natural slippage / 564 / Low
One-off technical adjustments / 2,031 / Low
Absence management / 400 / Low
HIGH IMPACT MEASURES
Reduce use of private non-emergency ambulance transport / 200 / High
Containment of packages/community placements / 1,475 / High
Cessation of non-contract agency nurses / 2,420 / High
Cessation of Medical Locums / Low
Reduce non-urgent elective day surgery / 2,000 / High
Reduce number of community based rehabilitation beds / 450 / High
Car Park Charging Increases / 75 / High
Cease dom care meals provision / 60 / High
Total / 13,000
In addition to the above the Trust is required to achieve £1.874m of Savings through Pharmacy Procurement initiatives which, if delivered, will have no impact on front line service delivery.