Clinical Director / Associate Medical Director Introductory Development Programme Finance Session John Maddison Director of Finance & Information 15/04/11. Purpose of the Session. Corporate & Financial Governance How the money flows in the NHS & PbR
Clinical Director / Associate Medical Director Introductory Development Programme Finance SessionJohn Maddison Director of Finance & Information15/04/11
-Composition of Board and its sub committees
-How meetings are conducted
- Form, content and frequency of reports
-Duties and obligations of Board Members
“a financial plan that sets out in clear and concise terms the resources assigned to the delivery of service and operational targets for a defined period”
Forward planning allows the Trust to shape its future, rather than to react to events and is critical in the achievement of organisational objectives.
-Financial and/or quantitative statements
-Prepared and agreed for a specific future period
-Designed to fulfil agreed objectives
-Drawn up for separate activities/projects and for organisations
Current year budget
Next year budget
Set other reserves
Add: full year
staff, materials etc
-Prioritisation of objectives identified in the planning process and formalised via the annual plan and underpinning Service Level Agreements
-Assessment / quantification of total available resources, both financial and non financial
-SLA’s with PCTs and other NHS bodies in accordance with the National Tariff and PbRs
-Private patients, RTA’s
-Medical and non-medical training funding via the Workforce Development Directorate of the SHA
-Commercial sources of income – car parking, catering etc
-Forecast outturn at month 10 in 2010/2011 and cover direct costs under the control of the budget manager
-Pay – detailing the agreed establishment in terms of WTE, £’s by AfC and local Trust grade
-Non-pay – by subjective category e.g. drugs, M&SE, provisions, energy etc
-Internal recharges for services provided / received such as pathology, radiology etc
What is a budget holder’s responsibility?
-understand and manage their budget
-what drives income/costs ?
-what influences outcomes/outputs ?
-deliver required quantity/quality of care/service
-maximise income, minimise cost
-Clarify objectives – what are you required to deliver?
-Understand what other organisation-wide targets you contribute to
-Maximise income – look for opportunities
-Cash releasing savings: the same work for less money
-Cost improvement: more work for the same money
-Focus on VFM.
The purpose of the NHS is to serve patients and the public by whom it is funded. Clinicians seek to do this by using their skills to provide the best possible advice, treatment and care. But they can only do this if the money available to the NHS is used well. Failure to do so results in less care and lower quality. Money will only be used well if clinicians are fully engaged in managing it. Ultimately, it is clinicians who are responsible for the way in which services are delivered to individual patients and it is they who commit the necessary resources.
In 2010/11 CIP target was £12.8m (5%), actual delivered = £9m(3.5%)
National efficiency in tariff for 2011/12 = 4%,but due to 10/11 slippage, PCT financial position etc target = £16m(6.25%)
CIP over next 6 years = circa £51 million (not including savings required for new hospital)
New Hospital scenario – adds a further £25m of savings based on 2 to 1 site rationalisation economies
This level of saving can only be contemplated if we look at major system transformation & radical solutions as well as tried and tested options
The need for real efficiency savings !
The Director General for NHS Finance
“ The NHS will have to deliver efficiency like never before”