Agenda item

Nicky Tamanis will report at the meeting.

Nicky Tamanis, Deputy Director of Finance attended the meeting to provide Members with an overview of the financial position and financial plan for Pennine Acute NHS Trust, NHSI oversight, the process to reach a more balanced position as well as details of the capital programme.

The Trust currently receives income of 661.9million pounds, 90% of income relates to patient care, activities a 5% increase from 2016/17.

The Trust’s expenditure includes pay costs of 440.2 million pounds, 64% of the total costs, a7.5% increase from 2016/17, Non Pay 242.9 million pounds, 23% relates to drugs and 12% CNST.

The Trust currently has a deficit £68.9million pounds compared to £30.4m in 2017.18.  Agency Spend has reduced to £34.9m in 2018/19 with a Yearend cash sum of £3.0m compared to £11.4m in 2017/18.  The Trust plans to spend £32.5 million on Capital Investment projects compared to £19.7m the previous year.  The Trust has maintained a Risk Rating of 4.

The Deputy Director of Finance reported that with regards to the A&E 4 Hour Target; Trusts will be expected to meet 90% by September 2018, and return to 95% by March 2019, the expectation is that the waiting list should not be any higher in March 2019 than in March 2018, alongside the expectation to halve the number of patients waiting 52 weeks in the same period.

The Deputy Director of Finance provided further information with regards to the Trust’s financial plan for 2018/19.  The plan includes the following information:

·         The Sustainability and Transformation Fund is to become the Provider Sustainability Fund (PSF), with total funding of £2.45bn (up from £1.8bn currently). Access to 30% of the fund remains linked to A&E performance.  A new £400m commissioner sustainability fund (CSF) will also be introduced to enable CCGs to return to in-year financial balance.

·         The national eight shadow Accountable Care System sites and two devolved health and care systems are now to be known as Integrated Care Systems (ICS). ICSs are expected to prepare a single system operating plan and to work within a system control total. They are expected to move to a more ‘autonomous’ regulatory relationship with NHS England and NHS Improvement over time.

·         There will be no additional winter funding in 2018/19. Systems are required to produce a winter demand and capacity plan with actions and proposed outcomes.

·         The two-year National Tariff is unchanged, with local systems encouraged to consider local payment reform in certain areas.

Responding to a Member’s question, the Deputy Director of Finance reported that to ensure the sustainable delivery of services in the future there would be savings proposed but also some additional capital investment.

The Trust has worked with NHS Improvement to develop a sustainable financial recovery plan to address the deficit.  The Director of Strategy reported that the development of the N-orthern Care Alliance Service Strategy will address some of the financial issues but may result in significant changes in how services are delivered.

Responding to a Member’s question the Deputy Director of Finance acknowledged that the IT infrastructure will need additional investment; staff at Pennine Acute are working with colleagues at the Salford Royal, to share best practice in addition to securing further investment for IT infrastructure.

With regards to the services provided; the Director of Strategy reported that the development of the North East Sector commissioner- led strategy should help address some of the financial issues but is likely to require significant changes in how services are delivered in order to ensure clinical and financial sustainability.  With regards to the services provided, the Director of Strategy said that there may be greater centralisation of some services going forward; complex operations may be undertaken in centralised locations while assessment and out-patient appointments will be provided locally.

Responding to a Member’s question the Deputy Director Finance reported that 60% of expenditure is on staffing costs, there are no plans to reduce the numbers of staff to address the financial deficit at the Trust.  The Director of Strategy reported that there will be reduction in agency spend, improved recruitment and retention as well as an emphasis on reviewing the workforce, with a view to employing more nursing associates.

It was agreed:

Further detailed information in respect of the Trust financial position and work undertaken to address the financial deficit will be considered at afuture meeting of the Joint health overview and scrutiny committee for Pennine Acute.