SOMERSET PARTNERSHIP NHS FOUNDATION TRUST FINANCE REPORT. Report to the Trust Board 4 July 2018

Transcription

1 G SOMERSET PARTNERSHIP NHS FOUNDATION TRUST FINANCE REPORT Report to the Trust Board 4 July 2018 Sponsoring Director: Author: Executive Summary Director of Finance. Director of Finance supported by Deputy Director of Finance. The Finance report sets out the overall income and expenditure position for the Trust. It includes commentary on the key factors and variances which are impacting on the financial position. The report also sets out information on capital expenditure, balance sheet, cash flow and cost improvements. Key financial ratios and performance against the NHS Improvement continuity of service risk rating are also included. The result for the two months to 31 May 2018 is a deficit of 105,000 (against a planned deficit of 114,000). The planned deficit arises because of the phasing of the cost improvement plan. Agency spend in the month continues to be significant at 558,000, resulting in spend for the year to date of 1,141,000, 345,000 above the agency cap for the Trust. However, this includes 242,000 of costs incurred in supporting patients in need of Tier 4 CAMHS placements, fully funded by NHS England. Recommendation(s): The Board is requested to discuss the report. Action Required (Please put a against any actions required) For approval For assurance For information For discussion Links to the Assurance Framework and Corporate/Directorate Risk Register (Please include relevant risks and the current risk rating) Strong financial management and controls supports all risks on the assurance framework. Finance Report July 2018 Public Board - 1 -

2 G Financial, Staffing, Legal/Statutory Implications/requirements (Please indicate whether there are any financial and/or legal/statutory implications by putting a against the relevant box. (Please also provide the necessary details) Financial Staffing Legal/Statutory Under the terms of its licence and NHS Improvement s risk assessment framework the Trust has a duty to remain financially viable. Equality The Trust wants its services to be as accessible as possible, to as many people as possible. Please indicate whether the report has an impact on the protected characteristics and put a against one of the two options set out below 1. This report has been assessed against the Trust s Equality Impact Assessment Tool and there are no proposals or matters which affect any persons with protected characteristics or 2. This report has been assessed against the Trust s Equality Impact Assessment Tool and there are proposals or matters which affect any persons with protected characteristics and the following is planning to mitigate any identified inequalities: Public/Staff Involvement History (Please indicate if any consultation/service user/patient and public/staff involvement has informed any of the recommendations within the report) Not Applicable. Finance Report July 2018 Public Board - 2 -

3 G SOMERSET PARTNERSHIP NHS FOUNDATION TRUST FINANCE REPORT TO 31 MAY SUMMARY 1.1 The Income and Expenditure result for the Trust for the two months to 31 May 2018 is as follows: a deficit of 105,000 against a planned deficit of 114,000; a planned outturn of a surplus of 3,027,000 for the year 2018/19 which includes 2,303,000 of income from the Provider Sustainability Fund (PSF) at the Department of Health; and a NHS Improvement continuity of service rating of 2. The planned rating at the end of May is INCOME AND EXPENDITURE (Tables 2 and 3 attached) 2.1 Table 2 sets out the income and expenditure account to 31 May The overall Trust position shows a deficit of 105,000 against a planned deficit of 114, Total operating income is ahead of plan for the month, mainly due to the recharge to NHS England of agency costs in respect of support for patients in need of Tier 4 CAMHS placements. 2.3 Total operating expenditure is ahead of plan for the same reason, with pay costs higher than plan due to the consequent high levels of agency spend. Agency spend in the month was 558,000, resulting in spend for the year to date of 1,141,000, 345,000 above the agency cap for the Trust. However, this includes 242,000 has been recharged to NHS England. Non-pay costs are broadly in line with plan. 2.5 Table 3 sets out the position by service directorates. 2.6 In Community Services, spend is broadly in line with plan for the month, with most services operating within their budget. However, there is a significant element of the directorate s cost improvement plan phased towards the latter half of the year. 2.7 The Mental Health directorate shows a small underspend in month, with an improved position on out of area placements. 2.8 The Children, Young People, Families and Dental directorate is underspent in the month, with most services operating within their budgets. Finance Report July 2018 Public Board - 3 -

4 G 2.9 Central operations comprise the operational management structure, certain non-pay costs that are held centrally (such as pathology, radiology and maintenance of medical equipment). Costs are in line with plan for the month The central medical costs are lower than plan in month Within central services, costs are slightly higher than plan in the month due to delays in achieving savings targets. 3. COST IMPROVEMENT PROGRAMME 3.1 A cost improvement programme totalling 5,053,000 was drawn up in conjunction with operational directors and managers and has been discussed with the Chief Nurse and Chief Medical Officer. 3.2 Table 4 details the schemes for 2018/ As at the end of May 2018, the cost improvement programme plan shows a favourable 11,000 variance overall against the plan. 4. CASH FLOW, INVESTMENT REPORT, DEBTORS AND BALANCE SHEET 4.1 The Balance Sheet is shown in Table 5, including a comparison with the plan submitted to NHS Improvement. There are several variances in the elements making up working capital. 4.2 The aged debtor analysis is shown in Table 6. The value outstanding continues to represent a low percentage of overall income. Debtor days have decreased from 6.2 in April 2018 to 4.2 in May There are no significant debts thought to be at risk. 4.3 A twelve-month cash flow forecast is shown in Table 7 showing how cash balances are planned to change over the next twelve months. This is in line with the 2018/19 final plan submitted to NHS Improvement. 4.4 The Trust had cash balances of 11,607,000 at 31 May This is 3,074,000 lower than plan, due to a reduction in the Trusts creditor position and delays in receiving PSF monies from Department of Health. It is anticipated that this will stabilise as the month s progress. Finance Report July 2018 Public Board - 4 -

5 G 5. CAPITAL 5.1 Capital expenditure for the year was 235,000 as detailed in Table The capital plan for 2018/19 included schemes totalling 6,958, RECOMMENDATION 6.1 The Board is requested to discuss the report. DIRECTOR OF FINANCE Finance Report July 2018 Public Board - 5 -

6 Table 1 Somerset Partnership NHS Foundation Trust EXECUTIVE SUMMARY AT 31 MAY 2018 BUDGET PERFORMANCE NHS IMPROVEMENT SINGLE OVERSIGHT FRAMEWORK m m m Budget Actual Variance CAPITAL SERVICE COVER 20% 2 Income Pay (20.9) (21.1) (0.2) LIQUIDITY 20% 1 Non Pay (6.8) (6.8) (0.0) EBITDA (0.0) UNDERLYING PERFORMANCE 20% 3 Other (1.3) (1.3) (0.0) Surplus before exceptional items (0.1) (0.1) (0.0) I&E MARGIN VARIANCE FROM PLAN 20% 1 EBITDA Margin 4.12% 4.15% AGENCY SPEND 20% 3 Surplus Margin (0.39%) (0.36%) CONTINUITY OF SERVICE RATING 2 MONTHLY SURPLUS PERFORMANCE 3,500K 3,000K 2,500K 2,000K 1,500K 1,000K 500K - (500)K 0 A M J ` J A S O N D J F M ` MEDICAL OVER/(UNDER)SPEND 1,000K 900K 800K 700K 600K 500K 400K 300K 200K 100K - A M J J A S O N D J F M Plan Actual 2018/ /18 YTD SURPLUS VARIANCE 100K 90K 80K 70K 60K 50K 40K 30K 20K 10K - 0 A M J J A S O N D J F M STAFFING COSTS - NURSING Jan-18 Feb-18 Mar-18 Apr-18 May-18 '000 '000 '000 '000 '000 Substantive 4,778 4,634 4,512 4,626 4,828 Agency Bank Overtime Total nursing costs 5,378 5,181 5,184 5,307 5,439 Excess as proportion of total 11.16% 10.56% 12.96% 12.84% 11.24% COST IMPROVEMENT PLANS 6,000K 5,000K 4,000K 3,000K 2,000K 1,000K - A M J J A S O N D J F M Plan CYE actual Recurrent EXCESS STAFFING COSTS AS A PROPORTION OF TOTAL NURSING 14% 12% 10% 8% Agency 6% Bank 4% Overtime 2% 0% CASH ( m) Actual Plan 12 month forecast CAPITAL Capital spend YTD trust Donated assets YTD Spend YTD (below)/above plan Annual plan trust m (0.52) A M J J A S O N D J F M COMMENTARY. The financial result for the two months to 31 May 2018 was a deficit of 105,000 against a planned deficit of 114,000. Capital expenditure for the year to 31 May 2018 was 235,000 against the plan of 771,000

7 Somerset Partnership NHS Foundation Trust Table 2 Current Budget for Year STATEMENT OF COMPREHENSIVE INCOME Month 2 - MAY 2018 Current Budget to Date Variance from Budget to Date Variance from Budget Last Month Actual to Date Last Year Variance Actual to Date Last Year Actual to Date In-Month Run Rate '000 '000 '000 '000 '000 '000 '000 '000 A(ii) B C D E F G H Clinical income 155,823 NHS clinical income 25,939 26, , ,810 (9) 11,387 Other clinical income 1,898 1, (9) 2, ,210 Total clinical 27,837 27, , , Non-clinical income 119 Research and development ,611 Education and training Catering (4) 8 (1) 20 (3) 3,720 Accommodation (3) 318 (11) 638 (3) 692 Services to NHS bodies (1) Miscellaneous other ,562 Total non-clinical 1,093 1, (2) 1, ,772 Total Operating Income 28,930 29, , , (125,823) Pay (20,929) (21,074) (145) (10,759) (66) (20,553) (15) (37,086) Non Pay (6,809) (6,822) (13) (3,341) (12) (6,164) (181) (162,909) Total Operating Expenditure (-) (27,738) (27,896) (158) (14,100) (78) (26,717) (196) 10,863 EBITDA for FRR 1,192 1, ,393 (22) 100 Donated asset income Gain/(loss) on disposal (4,296) Depreciation and amortisation (716) (734) (18) (368) (8) (653) - 6,667 Operating Surplus/ (Deficit) from Operations (2) (22) Net profit(+)/loss(-) on disposal of - assets Bad debts written off/(back) Interest receivable (+) (1) Interest payable and other finance (24) costs (-) (4) (4) - (2) - (5) - (3,634) PDC dividends payable(-) (606) (606) - (303) - (588) - 3,027 Retained Surplus/(Deficit) for period (114) (105) 9 (105) (23) 6.25% EBITDA margin 4.12% 4.15% 1.74% Surplus margin before exceptional items -0.39% -0.36%

8 Somerset Partnership NHS Foundation Trust Table 3 DIVISIONAL PEFORMANCE Month 2 - MAY 2018 Current Budget Budget to Date Actual to Date Variance to Date In Month Run Rate Variance Last Month '000 '000 '000 '000 '000 '000 A B C D E F 149,945 Contract income 24,859 24,801 (58) 12,442 (29) 574 Cost and volume contract income (35) 20 (6) 1,397 Non contracted activity income ,659 Other activity income 1,610 1, ,575 Total Corporate Income 26,798 26,734 (63) 13,407 (30) Expenditure less sundry income: 71,260 Community Services 12,064 12, , ,629 Children & Young People & Dental 3,876 3, , ,696 Mental Health and Learning Disabilities 5,632 5, ,877 (3) 5,966 Central Operations ,552 TOTAL OPERATING DIRECTORATES 22,567 22, , ,319 Medical ,046 Pharmacy (5) ,796 Central Services 2,453 2,492 (39) 1,232 (31) 16,161 TOTAL OTHER SERVICES 3,039 3,044 (5) 1,513 (6) 150,712 Total Operating Expenditure 25,606 25, , ,863 Trust EBITDA 1,192 1, Notes: Negative variances = Adverse EBITDA = Earnings before Interest Tax Depreciation & Amortisation An element of income, primarily not patient related, is credited to individual operating budgets so totals may differ from the way income is presented in Table 2

9 Somerset Partnership NHS Foundation Trust COST IMPROVEMENT PROGRAMME 2018/19 Lead Month 2 - MAY 2018 Project Full Year Plan to Variance to Variance to Status Impact Plan Date Actual to Date Date Date Non- Recurrent Total Recurrent Recurrent RAG '000 '000 '000 '000 '000 '000 Operating Directorates Community Services Andy Heron AMBER R 2, (49) 40 Mental Health & Learning Disabilities Jane Yeandle AMBER R (24) (24) Childrens, Young People & Families & Dental Ethna Bashford AMBER R (27) (2) Central Operations Andy Heron GREEN R Property rentals Phil Brice GREEN R Pharmacy/medical Sarah Oke AMBER R Procurement Pippa Moger GREEN R (8) (8) Central services Executive Directors GREEN R , (103) 11 Mth 2 Tables for PM - with updates Table 4 26/06/ :52

10 Table 5 Somerset Partnership NHS Foundation Trust STATEMENT OF FINANCIAL POSITION Month 2 - MAY 2018 Prior Year Movement in Current Period balances Plan Variance Prev Month Mar-18 May-18 YTD May-18 May-18 Apr A B C D E F Non-current assets 117, ,949 (499) 117,907 (958) 117,164 Current Assets Inventories NHS Trade receivables 4,562 6,283 1,721 4,790 1,493 5,778 Related party receivables (16) 236 (24) 164 Provision for bad debts (178) (180) (2) (178) (2) (176) Other receivables - current 1,834 1,137 (697) 1,834 (697) 1,256 Accrued income 788 2,644 1, ,856 1,740 Prepayments - current 2,027 2, , ,414 Cash in hand and at bank 14,895 11,607 (3,288) 14,681 (3,074) 11,686 Total current assets 24,585 24, , ,291 Liabilities - current Creditors - NHS (2,613) (2,257) 356 (2,613) 356 (1,398) Related party payables (3,797) (3,855) (58) (3,797) (58) (3,718) Creditors - Non NHS: revenue (4,001) (1,876) 2,125 (4,001) 2,125 (2,836) Other payables (16) (9) 7 (16) 7 (33) Deferred income (298) (137) 161 (298) 161 (93) Accruals (3,752) (5,493) (1,741) (3,552) (1,941) (4,522) Provisions - current (100) (100) - (100) - (100) Loan - falling due within 1 year (200) (200) - (200) - (200) Finance leases - current (32) (32) - (32) - (32) Dividend accrued (5) (611) (606) (603) (8) (303) Total current liabilities (14,814) (14,570) 244 (15,212) 642 (13,235) Net current assets/(liabilities) 9,771 10, , ,056 Borrowings - non current (1,100) (1,100) - (1,100) - (1,100) Finance leases - non current (42) (43) (1) (40) (3) (43) Provisions - non current (52) (51) 1 (44) (7) (52) TOTAL ASSETS EMPLOYED 126, ,920 (105) 125, ,025 TAXPAYERS EQUITY Public Dividend Capital 32,763 32,763-32,763-32,763 Revaluation reserve 19,947 19,947-19,947-19,947 Income and expenditure reserve 73,315 73,210 (105) 73, ,315 TOTAL TAXPAYERS EQUITY 126, ,920 (105) 125, ,025

11 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 % of Debt allocation Debtor days Table 6 Somerset Partnership NHS Foundation Trust AGED DEBTOR ANALYSIS Month 2 - MAY 2018 Current 1-30 over Older Total Doubtful debts Care UK - (25,231) (25,231) - Leagues of Friends NHS England , , ,270 - NHS Welsh and Scottish bodies Other CCGs 107,056 58,171 2,938 1,546 7, ,132 - Other FTs and NHS Trusts 34,861 7,508 1,341-2,009 45,719 - SCC 9,664 23,977 49,211 5,774 33, ,197 - Less billed in advance - (7,992) South West CCGs 10,952,299 41, ,618 - Less billed in advance (10,870,333) South West FTs 101, ,398 56, ,110 60,103 1,198,796 - Universities, colleges and schools 4, ,272 - Sundry debtors 14,637 32,359 28,238 5,413 45, ,291 (11,989) Total invoices unpaid 353,647 1,227, , , ,297 2,014,690 Less provision for doubtful debts (11,989) (11,989) - Trade debtors at month end 353,647 1,227, , , ,308 2,002,701 (11,989) 18% 61% 7% 7% 7% Debtor days Previous month 2,305, , , ,061 80,317 2,963,737 (11,989) TOP TEN DEBTORS TAUNTON & SOMERSET NHS FT 57, ,267 21, ,110 60, ,553 - NHS ENGLAND - 239, ,932 - YEOVIL DISTRICT HOSPITAL NHS FT 43, ,132 34, ,245 - SOMERSET COUNTY COUNCIL 9,664 15,985 49,211 5,774 33, ,197 - NHS WILTSHIRE CCG 28,296 23, ,272 - SOMERSET CCG 24,411 24, ,545 - NORTH,EAST,WEST DEVON CCG 44, ,034 - NHS WOLVERHAMPTON CCG 19,977 14, ,918 - B BRAUN AVITUM LTD - 19,509 7, ,996 - ROYAL DEVON & EXETER NHS FT 24, ,336-90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Debtor trends Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May Debtor Days Current 1-30 over Older

12 Somerset Partnership NHS Foundation Trust Table 7 12 MONTH ROLLING CASHFLOW ( 000) Month 2 - MAY 2018 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast EBITDA ,097 1,159 1,159 1,102 1,171 1,201 1,201 Movements in working capital: NHS debtors (505) 1, (154) (153) 231 (230) (231) 422 (269) (268) (268) Other debtors & prepayments (1,018) (900) 100 NHS creditors 863 Other creditors & deferred income 168 (100) (100) (100) (100) (100) (100) (100) (100) (100) 900 (100) Provisions and liabilities - (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) Cash flow from operations 60 2, , , Capital expenditure (144) (579) (579) (579) (579) (579) (579) (579) (579) (579) (579) (579) Cash receipts from asset sales Cash flow before financing (84) 1, (45) (1) Movement in long term provisions - (5) (5) (5) (5) (5) (5) (5) (5) (5) (5) (5) Interest (paid) (2) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) Interest received on cash balances Loans received /(repaid) (100) (100) Dividends paid (1,818) (1,818) Net cash inflow/(outflow) (79) 1, (51) (1,824) (1,471) 347 Opening cash balance 11,686 11,607 13,304 13,615 13,564 11,740 12,483 12,827 13,069 14,008 14,325 12,854 Net cash inflow/(outflow) (79) 1, (51) (1,824) (1,471) 347 Closing cash balance 11,607 13,304 13,615 13,564 11,740 12,483 12,827 13,069 14,008 14,325 12,854 13,201

13 Table 8 Somerset Partnership NHS Foundation Trust CAPITAL PROGRAMME 2018/19 MONTH 2 - MAY / /19 Outline Actual Source of Funds Spend YTD '000 '000 Depreciation 4,230 Re-investment of surplus 1,137 Sustainability and Transformation Funding 1,638 Loan repayment (200) Underspend 485 Accumulated cash 5,933 Total Sources of Funds 13, / / /19 Outline Plan Actual Scheme Location Spend to date Spend '000 '000 '000 HEALTH & SAFETY / FIRE PRECAUTIONS Other TOTAL HEALTH & SAFETY / FIRE PRECAUTIONS SAFER SERVICES AND RISK MANAGEMENT Other TOTAL SAFER SERVICES PATIENT ENVIRONMENT P.L.A.C.E. improvements Trust Wide - MH & CH Boiler Plant Replacement Rydon/Holford Ensuite Sanityware facilities Ash Ward TOTAL PATIENT ENVIRONMENT SITE & SERVICE REDEVELOPMENTS Other TOTAL SITE REDEVELOPMENTS SITE & SERVICE REDEVELOPMENTS Strategic Site Redevelopment 2, Implementation of IT strategy - inc Technology Fund 2, Other IT - E Rostering TOTAL STRATEGIC PROJECTS 4, Facilities capital programme management Specialist Equip Replacement - Diagnostic Imaging Replacement CONTINGENCIES BACKLOG MAINTENANCE SUNDRY EQUIPMENT - MH SUNDRY EQUIPMENT - CH SUNDRY EQUIPMENT - SOFT FM TOTAL OTHER 1, TOTAL CAPITAL PROGRAMME 6,