Agenda item

Finance Report

Karen Johnson, Director of Finance

Minutes:

The Board received and considered a report on finance for month 8, together with a presentation.

 

The report did not contain any data relating to Sustainability & Transformation Funding (STF) and represented the Trust Control Total only.  Furthermore, the report did not include any winter funds which needed to be added.

 

Actual Operating costs

In month deficit of £702k. Year to date (YTD) deficit of £4,014k compared to target deficit of £2,457k.

NHS Clinical Income

£23.4m in month and £181.8m YTD (£1.6m above plan YTD)

Total Income

£28.3m in month and £222.0m YTD (£1.0m below plan YTD)

Income Activity highlights for the month (based on estimated activity)

·         Elective inpatients below plan

·         Day case activity below plan

·         Non-elective above plan

·         Outpatient appointments below plan

·         A&E below plan

Total Operating Expenditure

 

£27.1m in month and £210.5m YTD (£0.24m above plan YTD)

Expenditure highlights in month:

·         Drugs £0.439m above plan (£1.49m above plan YTD)

·         Pay £0.640m above plan (£4.592m above plan YTD)

·         Supplies £0.458m above plan (£0.428m above plan YTD)

·         Other Costs £1.284m below plan (£6.329m below plan YTD)

EBITDA

5.2% YTD against a plan of 5.7%

Savings

Savings plan of £14.052m of which £12.491m identified

£0.887m Cost Improvement Plans (CIPS) delivered in month against a plan of £1.309m.

£7.117m delivered against a plan of £8.595m YTD (£1.478m below plan)

Forecast

The forecast had deteriorated in month prior to any mitigation actions. After the application of £1.6m of mitigations, the forecast was a £7.784m deficit which was £2.824m below the plan deficit of £4.96m. In addition there were additional risks to the forecast that could result in a £8.460m to £8.960m deficit which was £3.5m - £4m worse than the Control Total. 

Since closing the month end position a further risk of up to £1.8m income could have a direct impact on the Trust’s year end position resulting in the worst case scenario of £1.8m variance from plan (£10.76m deficit).

Debtors

£32.7m debtors and stock

£2.3m above plan

Creditors

£61.2m creditors and borrowings

£2.1m above plan

Cash

£6.9m

£3.4m above plan

Loan

Loan repayment of £99k in month

Finance Risk Ratings

YTD Use of Resources (UoR) 4 (Rating 1- top and 4 - bottom).

 

The Board discussed the report and comments were made as follows: -

 

Forecast

The Trust’s income had been reduced by about £1m mostly because of patient streaming.  KJ reported that she was having discussions with Swindon Clinical Commissioning Group (CCG) around an end of year block payment.  However, the CCG was seeing pressures within primary care and therefore a block payment was unlikely which was reflected in the forecast.  AC questioned whether there was anything that the Board could do to strengthen discussions with the CCG commenting that the revised streaming arrangements were right for patients.  AC questioned whether a Chair to Chair discussion might be helpful.  KJ advised that this was the way the national funding worked but that she would continue the discussions with the CCG as it was not unreasonable to seek financial support.

 

KJ explained the main causes for the variance to plan.  There had been an impact relating to payments to ID Medical which had not been accrued.  This was currently being validated totalling £140k.  Also the Trust had experienced a small number of patients with costly specialist cancer treatments circa £10k - £15k per patient. 

 

Control Total

KJ advised that she had been in discussion with NHS Improvement (NHSI) around the Trust’s Control Total.  NSHI had advised that closure of the financial gap and achievement of the Control Total was possible, but KJ believed this was unlikely and that she would have further discussions with NHSI at month 9.  KJ reported that deviation from plan at the end of quarter 3 was not supported by NHSI.  The Trust was able to demonstrate it was struggling financially, and a recovery plan was in place.

 

Income

It was noted that activity in December was lower and therefore income would be lower. 

 

Cash

The Trust had yet to hear back from NHSI around the cash draw down in January. 

 

RESOLVED

 

(a)   that it be noted the Month 8 financial position is a year to date deficit of £3,152k including STF and excluding STF is a year to date deficit of £4,014k;

 

(b)   that it be noted that the forecast outturn after mitigations is a deficit of £7,748k excluding STF which is £2,824k worse than the Trust Control Total;

 

(c)   that it be noted that there are additional risks to the forecast that could result in a deficit of at least £10,760k deficit which £5,800k worse than the Control Total; and

 

(d)   that the forecast year end Use of Resources Rating is a 4.

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