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					Sheffield Care Trust
Mental Health and Wellbeing

SUMMARY REPORT
Report to: Date: Subject: From: TRUST BOARD/FINANCE SUB-COMMITTEE FSC Monday, 26th February 2007 TB Wednesday, 28th February 2007 Report of the Director of Finance for the Period Ending 31st January 2007 Mr. M. J. Rodgers, Executive Director of Finance

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1.

Purpose

This report contains the monthly financial statements for the period 1 st April 2006 – 31st January 2007.

2.

Summary

The financial out-turn for the period ending 31st January 2007 indicates an overspending of £324,800 compared with an underspending for the same period last year of £436,600. The revised plan submission assumed that we would have an overspending of £370,000 for the ten month period to the end of January and once again the actual out-turn to date is still marginally ahead of the planned position. Despite the position to date, the Trust is forecasting a break-even position at year-end and the planned position assumed improvement in the latter months of the year. Urgent action has been taken by Operational Management Group members to suspend the appointment to permanent vacancies until after the 1st April 2007. There are one or two exceptions to this recruitment decision which relate to vacancies in services funded by external income contracts or where an internal promotion leaves another vacant post. Section A of the report provides further detail regarding Directorate performance and a brief narrative regarding any overspending areas or areas where there have been significant changes since last month. Savings delivered against the cash releasing cost improvement targets are ahead of pro rata expectations and the outstanding element of the £1,078,000 fortuitous and opportunistic savings target is now £197,700. At this time, there is no reason to believe this will not be fully achieved by March 2007.

3.

Next Steps

The Trust is still forecasting a break-even position and the further control measures agreed at the October Board meeting are in place. Given tight financial control and the latest measures agreed by the Operational Management Group, the Trust should achieve its target break-even position at year-end.

4.
a. b.

Required Actions
The Board are requested to note the information contained in this report and in Appendices 1 – 6. The Board are requested to ratify the investment of £3m made during January 2007.

5.

Monitoring Arrangements

Presentation of this report on a monthly basis to the Trust Board and Finance Sub-Committee.

6.

Contact Details
  Mick Rodgers, Executive Director of Finance 2716716 (mick.rodgers@sct.nhs.uk)

For further information, please contact:

REPORT OF THE DIRECTOR OF FINANCE
January 2007
Executive Summary This report contains the monthly financial statements for the period 1st April 2006 – 31st January 2007. The financial out-turn for the ten month period indicates an overspending of £324,800 compared with an underspending for the same period last year of £436,600. The revised plan submission assumed that we would have an overspending of £370,000 for the ten month period to the end of January and once again the actual out-turn to date is still marginally ahead of the planned position. Despite the position to date, the Trust is forecasting a break-even position at year-end and the planned position assumed improvement in the latter months of the year. Urgent action has been taken by Operational Management Group members to suspend the appointment to permanent vacancies until after the 1st April 2007. There are one or two exceptions to this recruitment decision which relate to vacancies in services funded by external income contracts or where an internal promotion leaves another vacant post. Section A of the report provides further detail regarding Directorate performance and a brief narrative regarding any overspending areas or areas where there have been significant changes since last month. Savings delivered against the cash releasing cost improvement targets are ahead of pro rata expectations and the outstanding element of the £1,078,000 fortuitous and opportunistic savings target is now £197,700. At this time, there is no reason to believe this will not be fully achieved by March 2007. The Trust is still forecasting a break-even position and the further control measures agreed at the October Board meeting are in place. Given tight financial control and the latest measures agreed by the Operational Management Group, the Trust should achieve its target break-even position at yearend.

A.

Summary Financial Management Reports to the Trust Board April 2006 – January 2007

Introduction Enclosed at Appendices 1 to 5 are the various financial summary reports for the ten month period, 1st April 2006 – 31st January 2007. These show an overspending to date of £324,800. Appendix 1 Appendix 1 consists of three pages. Page 1 shows summary budgetary performance by Executive lead whereas Page 2 breaks down budgetary performance to Directorate level. Page 3 provides a graphical comparison of monthly performance for the current and previous year. The comments below should also assist in the interpretation of the January out-turn:Acute, Community & Primary Care Directorate The Acute, Community & Primary Care Directorate is overspent by £200,900 for the period ending 31st January 2007, compared with an overspend of £220,400 at the end of December 2006. The Directorate’s in-year financial position continues to improve with a forecast year-end out-turn of £150,000 overspend (subject to agreement of PCT funding in respect of one out of town placement). Recovery, Rehabilitation & Specialist Directorate The Recovery, Rehabilitation & Specialist Directorate is overspent by £335,700 for the period ending 31st January 2007, compared with an overspending of £323,000 at the end of December 2006. The Directorate’s financial position worsened slightly during January and the final couple of months of 2006/2007 will follow a similar trend due to a combination of difficulties in meeting outstanding CIP targets and an anticipated shortfall in Forensic Cost Per Case income during February and March. Substance Misuse Directorate The Substance Misuse Directorate is overspent by £29,000 for the period ending 31st January 2007, compared with an overspending of £30,700 at 31st December 2006. Drugs (FP10s) are overspent by £238,000 to date, however, this overspend is being partially offset by vacant posts. Psychology Services Psychology Services is showing an underspending of £20,700 at the end of January 2007. This underspend has reduced since December due to an exercise which is underway to return underspendings to the relevant Directorates along with transfers to fortuitous savings. Therapy Services Therapy Services is currently underspent by £57,900 mainly due to vacant posts within the Learning Disability, Recovery & Rehab and Acute & Community Directorates. Again, work is underway to return underspendings to the appropriate clinical service areas and the reduction in underspend reflects this. Specialist Care & Treatment Dementia The Directorate is showing an underspend by £72,100 at 31st January 2007, compared to £7,300 at December. Community & Functional Mental Health The Directorate is overspending by £90,000 at the end of January 2007, compared to an overspend of £29,100 to the end of December 2006.

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Many changes have been actioned in respect of the split of the budgets for Functional Mental Health and Dementia Services, resulting in significant changes to individual out-turn positions, however, the overall position for Older Adult Services is an overspend of £17,900. Patient Experience & Practice Development Patient Experience & Practice Development is underspent by £15,300 as at the 31st January 2007. Although the overall financial position is healthy there are a number of underlying overspends that are being managed and these are:   Statutory training Legal Fees West PCT Risk SLA ceased as at 31st March 2006

The Directorate expects to manage the position and achieve a break-even at year-end. Linksworks The Linksworks Service has an overspending of £87,500 for the period to the end of January 2007. Income levels continue to fall short of the running costs for this service and work is continuing regarding the future configuration of this service. Appendix 2 The year-end out-turn shows a balanced position at 31st March 2007. Expenditure control measures have been implemented in accordance with the Board agreement in October 2006. Further controls have been agreed at the Operational Management Group and will remain in place until at least the beginning of April 2007. On this basis the Trust is expected to break-even by March 2007. This appendix also indicates that the CRL and EFL targets set by the NHS Executive will be achieved and that the Trust’s Capital Cost Absorption Duty and Management Cost targets will be met. Appendix 3 The table at Appendix 3 measures the Trust’s performance with respect to the payment of supplier invoices, both trade and NHS. As can be seen, the compliance rate for non-NHS bodies to January is 89.6% (number) and 86.2% (value). The compliance rate for payments to NHS bodies is 83.6% (number) and 82.5% (value). The percentage compliance rates are continuing to improve although the low compliance rates in the earlier months of the year have had a knock on consequence to current performance, particularly in respect of NHS bodies. Compliance rates continue to be closely monitored and payment profiles are proactively managed within available cash resources. No interest charges have been paid or are payable to date in respect of the late payment of supplier invoices. Appendix 4 & 4a These appendices show the cash releasing cost improvement targets that the Trust must achieve during 2006/2007 in order to deliver a break-even position at year-end. The tables show the composition of the grand total as well as the split between targets delegated to Directorates and aggregated schemes that will be delivered centrally. With respect to the central schemes, as in previous years, part of the target will be achieved via the withdrawal from Directorates of non-recurrent unplanned/fortuitous savings. The original cost improvement plan for the Trust totalled £3,695,000. With the addition of the further non-recurrent opportunistic savings of £500,000 required by Sheffield PCTs, the total cost improvement requirement for 2006/2007 is £4,195,000.

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To date savings of £3,837,400 have been identified and released against the £4,195,000 overall target, although £900,000 of this relates to the central target that was released in June. With respect to the Directorate targets, although the savings of £2,057,100 released to date are ahead of strict pro rata proportions, £390,200 of this has been released via non-recurrent measures. The total requirement of £4,195,000 included the planned release of non-recurrent fortuitous savings of £578,000 as well as the additional non-recurrent opportunistic savings of £500,000 required by the Sheffield PCTs. To date £880,300 has been released to satisfy these targets leaving a balance of only £197,700 to find during the remainder of the year. B. Cash Profile A summary of the Trust’s cash flow during January 2007 is given at Appendix 3. The cash balances are reasonable for this time of the year. C. Outstanding Debtor Accounts Set out below is a summary of debtor accounts outstanding as at the end of January 2007 analysed by age. Total Outstanding £’000 NHS Bodies Outside Organisations 2,435(3,421) 2,384(1,791) Less Than 2 Months Old £’000 1,810(2,739) 1,447(1,003) Between 2 & 6 Months £’000 377(666) 793(648) Greater Than 6 Months Old £’000 248(16) 144(140)

TOTAL

4,819(5,212)

3,257(3,742)

1,170(1,314)

392(156)

The corresponding position as at the end of December is shown in brackets. Follow up action continues to be taken on all outstanding debtor accounts over one month old. D. Capital Programme Appendix 5 shows the capital programme together with details of the current year spend against plan. The 3 major schemes: Forest Lodge, Argyll House and Lightwood House, have all slipped due to the recent poor weather conditions. Some Estates Management schemes have been brought forward from 2007/08 to offset this slippage. These schemes were approved at the November Finance SubCommittee meeting. A further IT business case for £60,000 will also be submitted to the February Finance Sub-Committee to offset the remainder of this slippage. E. Investment Strategy Generally cash balances are available for investment from the middle of the month when contract monies are received until the 27th of the month when salaries are paid. During January a deposit of £3.0m was made with the Government’s National Loans Fund Deposit Account from the 16th to the 25th. This deposit was approved by Kevan Taylor, Chief Executive and by Mick Rodgers, Executive Director of Finance. This deposit earned the Trust an additional £324 over what would have been received had the monies remained in the Trust’s interest bearing PGO account during January.

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F. c.

Recommendations The Board are requested to note the information contained in this report and in Appendices 1 – 6. The Board are requested to ratify the investment of £3m made during January 2007.

d.

MJR/jch(November 28, 2009)

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