NHS Board meeting. Wednesday, 23 June Subject: Statutory Annual Accounts 2009/10. Purpose: Recommendation: Approval of statutory annual accounts

Transcription

1 NHS Board meeting Wednesday, 23 June 2010 Subject: Statutory Annual Accounts 2009/10 Purpose: Recommendation: Approval of statutory annual accounts To adopt the statutory annual accounts and approve the chairman, chief executive and director of finance to sign relevant forms on their behalf. 1. Background 1.1 Attached are the statutory annual accounts for 2009/10 which have been audited by KPMG LLP. The Directors Report includes key performance indicators within section 3 of the Operating and Financial Review. 2. Operating cost statement 2.1 Net operating costs rose by around 23 million from million in 2008/09 to million in 2009/10. The general allocation uplift for 2009/10 was 17 million therefore this funded most of this spending increase, however in addition there was an increase of 3.7 million in general dental services which are directly funded by the Scottish Government Health Department (SGHD). Certain earmarked funding also increased in 2009/10 with an increase of over 700,000 in funding to tackle alcohol misuse and a new allocation of 500,000 for specialist children s services. 2.2 Note 4 to the accounts shows the 532 million of hospital and community health spend by provider grouping. Treatment in board area increased by around 12 million from last year. Resource transfer to local authorities increased by 1 million to 23 million while support finance increased by 0.6 million from last year. This reflects the fact that some 1.3 million of the funding given to Ayrshire & Arran Health Board to address alcohol misuse is given to local authorities. 2.3 Expenditure on family health services increased by around 9 million from the previous year. There was a 3 million increase in pharmaceutical services and primary medical services costs increased by 1.8 million compared to 2008/09. The cost increase for pharmaceutical services was limited because of a national agreement on Category M drugs and the Pharmaceutical Pricing Regulatory Scheme (PPRS) and as a result SGHD reduced the Board s allocation by 6.7 million during 2008/09 for Category M savings and a further 1.6 million in 2009/10 Page 1 of 136

2 for PPRS. General dental services expenditure has risen by 3.7 million which may be due to free check ups. 3. Balance sheet 3.1 Despite the completion of the 19 million Girvan Community Hospital, fixed assets have reduced in value from 327 million at 31 March 2009 to million at 31 March A revaluation of the whole estate at 31 March 2010 saw a significant downward movement due to the current economic climate, mostly adjusted through the revaluation reserve. 3.2 Payments due to primary care contractors for family health services and prescriptions, which are paid around one month in arrears, result in a 17 million creditor at the year end. Total creditors due within one year amount to 61 million, which is about 6 million less than last year due to the Agenda for Change accrual being much lower. Because no debtor is shown for SGHD funding to cover payments due to primary care contractors etc there are negative net current assets/liabilities shown on the balance sheet. In addition, creditors due after more than one year include 27.5 million related to Private Finance Initiative (PFI) hospitals. 3.3 Note 17 to the accounts shows provisions and there is an increase of over 1 million related to injury benefits and the clinical negligence increase is over 8 million due to a number of high value cases. The impact of the latter is largely offset through recovery from Clinical Negligence and Other Risks Indemnity Scheme (CNORIS) and there is a corresponding debtor of 14.4 million in Note 13 to the accounts. 3.4 Equal pay claims are shown as a contingent liability in Note 19 to the accounts as any liability cannot be quantified. 4. Signing of statements 4.1 The chief executive is required to sign the Directors Report, Statement of Accountable Officer s Responsibilities and Statement on Internal Control. The director of finance and chairman would sign the Statement of Health Board s Responsibilities in respect of the accounts. 4.2 The signatures of the director of finance and chief executive are required on the balance sheet and SFR 19.0 (patients private funds). 5. Audit 5.1 KPMG LLP (our external auditor) has completed its audit of the annual accounts and has reported to the Audit Committee that the accounts are true and fair and that they will issue a clean audit certificate. 5.2 The audit fee for 2009/10 audit was 266,980. This is an increase of over 7% and reflects additional audit work around implementation of International Financial Reporting Standards (IFRS). Page 2 of 136

3 6. Conclusion 6.1 The NHS Board has achieved all financial targets in 2009/10, whilst achieving significant improvements in clinical areas such as waiting times. The Board is asked to approve the signing of the statutory annual accounts for 2009/10. Derek Lindsay, Executive Director of Finance 15 June 2010 Page 3 of 136

4 Ayrshire and Arran Health Board Annual Report and Accounts for the year to 31 March 2010 Page 4 of 136

5 ANNUAL ACCOUNTS AND NOTES FOR YEAR ENDED 31 MARCH 2010 DIRECTORS REPORT DIRECTORS REPORT The directors present their report and the audited financial statements for the year ended 31 March Naming Convention Ayrshire and Arran NHS Board is the common name for Ayrshire and Arran Health Board. 2. Principal activities and review of the business and future developments The information that fulfils the requirements of the business review, principal activities and future developments can be found in the Operating and Financial Review, which is incorporated in this report by reference. 3. Date of Issue Financial statements were approved and authorised for issue by the Health Board on 23 June International Financial Reporting Standards These financial statements have been prepared, for the first time, under International Financial Reporting Standards (IFRS) as adopted by the European Union and as interpreted or adapted for the public sector context as set out in Note 1 Accounting Policies. Financial Statements were previously prepared under UK Generally Accepted Accounting Principles (UK GAAP). The effect of the transition from UK GAAP to IFRS, with an effective date of 1 April 2008, is set out in Note 25 First Time Adoption of IFRS and Note 26 Restated Balance Sheet. 5. Accounting convention Annual Accounts and Notes have been prepared under the historical cost convention modified by the revaluation of property, plant and equipment, intangible assets, inventories, available-for-sale financial assets and financial assets and liabilities at fair value through profit and loss. The accounts have been prepared under a direction issued by Scottish Ministers, which is reproduced as an appendix to these accounts The statement of the accounting policies which have been adopted is shown at Note Appointment of auditors The Public Finance and Accountability (Scotland) Act 2000 places personal Page 5 of 136

6 responsibility on the Auditor General for Scotland to decide who is to undertake the audit of each health body in Scotland. For the financial years 2006/07 to 2010/11 the Auditor General appointed KPMG LLP to undertake the audit of Ayrshire and Arran Health Board. The general duties of the auditors of health bodies, including their statutory duties, are set out in the Code of Audit Practice issued by Audit Scotland and approved by the Auditor General. 7. Board membership Under the terms of the Scottish Health Plan, the Health Board is a board of governance whose membership will be conditioned by the functions of the Health Board. s of Health Boards are selected on the basis of their position or the particular expertise which enables them to contribute to the decision making process at a strategic level. The Health Board has collective responsibility for the performance of the local NHS system as a whole, and reflects the partnership approach, which is essential to improving health and health care. Professor W Stevely, Chairman Mr J Callaghan, Non-Executive Director Mr M Cheyne, Non- Executive Director Mrs K Darwent, Non-Executive Director Dr C Davidson, Director of Public Health Mr J Dever, Non-Executive Director Mr C Duncan, Non-Executive Director Councillor D Filson, Non-Executive Director Dr A Gunning, Director of Policy, Planning and Performance Dr W Hatton, Chief Executive Mr W S Hislop, Non-Executive Director Councillor H Hunter, Non-Executive Director (w.e.f. 1 March 2010) Mr D Lindsay, Director of Finance Ms C Lisle, Director of Organisational and Human Resources Development (until 19 April 2009) Dr R Masterton, Medical Director Dr H McCallum, Non-Executive Director Mrs F McQueen, Director of Nursing Mrs R Miller, Vice Chair Ms E O Connell, Non-Executive Director Councillor D O Neill, Non-Executive Director Dr D Price, Non-Executive Director Councillor R Reid, Non-Executive Director (until 28 February 2010) Ms G Watson, Non-Executive Director The board members responsibilities in relation to the accounts are set out in a statement following this report 8. Board s and Senior Managers Interests Details of any interests of board members, senior managers and other senior staff in contracts or potential contractors with the Health Board as required by IAS 24 are disclosed in note 29. Page 6 of 136

7 SUMMARY OF MEMBERS INTERESTS JUNE 2010 NHS AYRSHIRE & ARRAN Board Declared Interest Details Prof William Stevely (Chairman) Mr John Callaghan (Non-Executive ) Mr Martin Cheyne (Non-Executive ) Skills Development Scotland The Scottish Agricultural College The Open University NHS Ayrshire & Arran Scottish Workforce & Governance Committee The Society of Chiropodists & Podiatrists Health Professions Council Scottish Partnership Forum Scottish Government Glasgow Caledonian University Ayrshire Chamber of Commerce and Industry Lloyds TSB Foundation Ayrshire Council on Alcohol Scottish Government Glasgow Caledonian University Ayrshire Council on Alcohol Non-Executive Director Non-Executive Director of Council Lead Partnership Facilitator / Chair of Staff Side / of Employee Relations Committee / Convenor of Staff Representatives / of Scottish Forum Registered Non-Executive Director Chair / Chair of Court / of Court Chief Executive Vice Chair Chair / of Management Board Chair of Health & Wellbeing Portfolio Audit Committee / of the Education & Lifelong Learning Portfolio Audit Committee Rolling contract with NHS 1 year rolling Service Level Agreement with NHS Page 7 of 136

8 Mrs Kirsty Darwent (Non-Executive ) Dr Carol Davidson (Director of Public Health) Mr John Dever (Non-Executive ) Mr Colin Duncan (Non-Executive ) Cllr Drew Filson (Non-Executive ) Scottish Institute of Human Relations The Family Consultation Centre Breastfeeding Network Midwifery Committee; Nursing & Midwifery Committee Association of Family Therapy Scottish Institute of Human Relations Baby Milk Action British Medical Association N/A Accounts Commission for Scotland Ayr Choral Union South Ayrshire Care and Repair University of Aberdeen Business Committee of the General Council Scottish National Party East Ayrshire Council The Lochdoon (Public House) Scottish National Party Course Co-ordinator for family therapy project Owner of organisation Service provided on own premises Breastfeeding trainer and supporter Worker within a local Breastfeeding Support Group Service Level Agreement with NHS from Convenor of South and West branch / Executive of the AFT Scottish Affairs Task Group of Family Therapy Project (part of SIHR) and the Scottish Institute of Human Relations Vice-Chair Convener Secretary, Ayr branch / Secretary, South Ayrshire Liaison Committee Councillor Proprietor Page 8 of 136

9 Dr Allan Gunning (Executive Director of Policy, Planning & Performance) Dr Wai-yin Hatton (Chief Executive) Mr Stuart Hislop (Chair Area Clinical Forum) Cllr Hugh Hunter (Non-Executive ) Doon Valley Hill Walking Club Aspire 2gether British Swimming Ayrshire Sportsability (ASA) Ayrshire Chamber of Commerce and Industry Kilmarnock College Chartered Institute of Personnel and Development Fischer s Services Ayrshire Sportsability Health and Heritage Management Consultancy/Alf Hatton & Associates Hislop Health Ltd NHS Ayrshire & Arran British Dental Association British Medical Association British Association of Oral & Maxillofacial Surgery Royal Society of Medicine British Association of Head and Neck Oncologists South Ayrshire Council South Ayrshire Council Chairman Director Non-Executive Director Chair of Management Committee Director on the Board Director on the Board of Psychology Faculty Cousin-in-law is Managing Director NHS Ayrshire and Arran is a member of ASA Trust, hence co-host of annual Come and Try event My husband is the Director Health and Heritage Management consultancy could bid for work within NHS Ayrshire and Arran Director Consultant - Oral & Maxillofacial Surgeon Fellow Elected Election expenses as declared to Returning Officer following 2007 Local Authority elections. Page 9 of 136

10 Mr Derek Lindsay (Director of Finance) Dr Robert Masterton (Executive Medical Director) Dr Huntly McCallum (Chair Community Health Partnerships Advisory Committee) Ayrshire Medical Support Ltd Consultancy British Medical Association Ayrshire Medical Support Ltd Stevenston Medical Practice Ayrshire Doctors on Call Ayrshire & Arran Community Health Partnership North Ayrshire Medical Society Scottish General Practitioners Committee Area Medical Committee GP Sub-Committee Local Medical Committee British Medical Association Royal College of General Practitioners Medical and Dental Defence Union of Scotland West Kilbride Golf Club Seamill Ski Club Seamill Leisure Club Adrossan Academicals Rugby Club Largs Sailing Club 3TFM Lease of MRI Scanner until 2010 / NHS A&A lease land to AMS Hold shares in AMS on behalf of NHS A&A Endowment Trustees Consultant Lease of MRI scanner until 2010 / NHS A&A lease land to AMS Director and hold shares in AMS on behalf of NHS A&A Endowment Trustees Principal and partner GP Clinical Lead Chair & Junior Support Convenor Treasurer Medical Services Docslot presenter Page 10 of 136

11 Mrs Fiona McQueen (Executive Nurse Director) Mrs Rita Miller (Vice Chair) Ms Elaine O Connell (Non-Executive ) Cllr David O Neill (Non-Executive ) Dr David Price (Non-Executive ) N/A Scottish Labour Party Ayr, Carrick & Cumnock Co-op Party member Ayrshire Branch Shelter Oxfam National Trust for Scotland T&G Unite South Ayrshire Women s Aid Keith J Tuck, Solicitors North Ayrshire Council Trinity Church Trust Labour Party Co-op Party North Ayrshire Council North Ayrshire Council David Price Consulting North Ayrshire Council / Constituency Vice- Chair /, Scottish Policy Forum / Ayrshire Delegate to Party Council / of Scottish Council Supporter Supporter Director / Chair of Management Committee Solicitor Elected (Leader) Trustee North Ayrshire Ventures Ltd / North Ayrshire Ventures Trust Paid by Irvine Labour Party for North Ayrshire Council Election in May 2007 Sole employee Wife employed by Social Services Dept. Page 11 of 136

12 Cllr Robin Reid (Non-Executive ) Ms Gillian Watson (Non-Executive ) R Reid & Co South Ayrshire Council Institute of Financial Accountants Aberdeen & NE Scotland Family History Society Scottish Conservative Party Giltech Ltd Owner Councillor Fellow Director All Directors appointed by the Cabinet Secretary (shown in the remuneration report) are also Trustees of the Ayrshire and Arran Endowments. The Register of s Interests is maintained at Eglinton House, Ailsa Hospital, Ayr and is available for the public to view on request. 9. Pension liabilities The accounting policy note for pensions is provided in Note 1 and disclosure of the costs is shown within Note 26 and the remuneration report. 10. Remuneration for non- audit work No remuneration was paid to external auditors in respect of any non audit work carried out on behalf of Ayrshire and Arran Health Board. 11. Related party transactions During the year, Ayrshire and Arran Health Board had transactions with other NHS bodies which are shown in Note 4 to the Accounts Dr McCallum, a non-executive director of Ayrshire and Arran Health Board, is a general practitioner in an Ardrossan GP practice. Total amounts payable to this practice during the year under the General Medical Services contract, including quality outcome framework payments, were 586,766 of which 36,908 is outstanding at the year end. Ayrshire Medical Support Limited (AMS) is considered to be a related party as defined by International Accounting Standards (IAS) 24 related party disclosures. During the year ended 31 March 2010 the company sold MRI imaging services and training facilities to Ayrshire and Arran Health Board with a value of 532,115. The company also purchased services and facilities from Ayrshire and Arran Health Board amounting to 20,000. At 31 March 2010 amounts due from AMS were 5,000 and 21,940 was due to AMS Two executive directors of the Health Board are directors of AMS in their capacity as endowment trustees, but neither they nor any party related to them received or are due to receive any direct or indirect benefit or payments from AMS in their capacity as directors of the company. Mrs Kirsty Darwent is a worker within the local breastfeeding support group of Page 12 of 136

13 the Breastfeeding Network. During the year, the Breastfeeding Network received income from Ayrshire and Arran Health Board of 166, Payment policy Ayrshire and Arran Health Board is committed to supporting The Scottish Government in helping businesses during the current economic situation by paying bills more quickly. The intention is to achieve payment of all undisputed invoices within 10 working days, across all public bodies. The target has been communicated to all non-departmental public bodies, who are working towards the accelerated payment target of 10 working days. Prior to this, the Health Board did endeavour to comply with the principles of The Better Payment Practice Code ( by processing suppliers invoices for payment without unnecessary delay and by settling them in a timely manner. In 2009/10 average credit taken was 15 days from date invoice received. (2008/09 = 29 days from invoice date). In 2009/10 the Health Board paid 89% by value and 89% by volume of non NHS suppliers within 30 days of the invoice being received. Based on the date of invoices being received, 71% by value and 70% by volume were paid within 10 days. 13. Corporate governance The Health Board meets regularly during the year to progress the business of the Health Board. The following standing committees deal with more detailed governance issues: Clinical Governance Committee The Clinical Governance Committee ensures that clinical governance mechanisms are in place and effective throughout the local NHS system. The committee met on seven occasions during 2009/10. The membership of the Clinical Governance Committee comprises:- Dr David Price (Chair) Ms Elaine O Connell Mr Stuart Hislop (Chair, Area Clinical Forum) Mrs Kirsty Darwent Mr John Dever (until 1 October 2010) Ms Gillian Watson (from 1 October 2010) Councillor David O Neill Audit Committee The committee met four times during 2009/10 to consider reports received from internal audit (PricewaterhouseCoopers LLP) and external audit (KPMG LLP). The committee monitors corporate governance, probity and issues around internal control. The membership of the Audit committee comprises:- Mrs Kirsty Darwent (Chair) Page 13 of 136

14 Mr John Dever Dr David Price Councillor David O Neill Ms Elaine O Connell Staff Governance Committee The committee (which meets at least quarterly) monitors compliance with staff governance standards and a sub-committee is the Remuneration Committee. The membership of the Staff Governance Committee comprises:- Mr Colin Duncan (Chair) Ms Elaine O Connell (Vice Chair) Mr John Callaghan Mr Martin Cheyne Councillor Drew Filson Councillor Robin Reid (until February 2010) Ms Gillian Watson (until August 2009) Mr John Dever (from September 2009) Health and Performance Governance Committee The committee met seven times during 2009/10. The committee monitors health and performance against the HEAT targets and is sighted on other performance indicators which may not be formally reported through this mechanism. The membership of the Health and Performance Governance Committee comprises:- Mr Martin Cheyne (Chair) Mrs Kirsty Darwent Mr John Callaghan Mr Colin Duncan Councillor Drew Filson Councillor Robin Reid 14. Disclosure of information to auditors The directors who held office at the date of approval of this directors report confirm that, so far as they are each aware, there is no relevant audit information of which the Health Board s auditors are unaware; and each director has taken all the steps that he/she ought reasonably to have taken as a director to make himself/herself aware of any relevant audit information and to establish that the Health Board s auditors are aware of that information. 15. Human resources As an equal opportunities employer, the Health Board welcomes applications for employment from disabled persons and actively seeks to provide an environment where they and any employees who become disabled can continue to contribute to the work of the Health Board. The Health Board provides employees with information on matters of concern to them as employees through a two monthly Team Brief and more regular Page 14 of 136

15 Stop Press updates and consults employees or their representatives through the Area Partnership Forum so their views are taken into account in decisions affecting their interests. 16. Events after the end of the reporting period There have been no important events affecting the Health Board since the year end. 17. Financial instruments Information in respect of the financial risk management objectives and policies of the Health Board and it s exposure to price risk, credit risk, liquidity risk and cash flow risk is disclosed in Note 27. Page 15 of 136

16 OPERATING AND FINANCIAL REVIEW The operating and financial review has been prepared in accordance with the government Financial Reporting Manual and complies with best practice. 1. Principal Activities and Review of the Year The Board was established in 1974 under the National Health Service (Scotland) Act, 1974 and is responsible for commissioning healthcare services for the residents of Ayrshire and Arran, a total population of 368,000. Health Boards form a local health system, with single governing boards responsible for improving the health of their local populations and delivering the healthcare they require. The overall purpose of the unified NHS Board is to ensure the efficient, effective and accountable governance of the local NHS system and to provide strategic leadership and direction for the system as a whole The role of the unified NHS Board is to: - improve and protect the health of the local people; - improve health services for local people; - focus clearly on health outcomes and people s experience of their local NHS system; - promote integrated health and community planning by working closely with other local organisations; and - provide a single focus of accountability for the performance of the local NHS system The functions of the unified NHS Board comprise: - strategy development - resource allocations - implementation of the Local Delivery Plan - performance management Proposals for new Community Health Partnership (CHP) committees were approved by the Health Board meeting on 25 June The new structure includes a CHP Committee, CHP Forum and CHP Officer Locality Group for each of the three council areas. The Board meeting on 7 February 2010 received a progress report on each of the three CHPs. Acute services At the Board meeting on 4 October 2006 the Board approved plans to reconfigure acute services and these were submitted to the Scottish Executive Health Department to seek approval for the plans. The Minister for Health and Community Care wrote on 15 December 2006 approving the plans and making some specific requirements of NHS Ayrshire and Arran. The Minister also made provision in the NHS Scotland capital plan for an additional 30 million above the normal capital allocation to NHS Ayrshire and Arran. On 6 June 2007, following the election of an SNP government at the May 2007 elections, the Cabinet Secretary for Health and Wellbeing announced her reversal of the previous administration s decisions regarding accident and Page 16 of 136

17 emergency services at Ayr Hospital. The Cabinet Secretary required NHS Ayrshire and Arran to produce revised proposals that would enable A&E services to continue at both Ayr and Crosshouse Hospitals. These proposals were to be subject to independent scrutiny from a Panel. Costed options were submitted to the Independent Scrutiny Panel in September 2007 and at the Board meeting on 23 January 2008 the Board considered reports from the Independent Scrutiny Panel as well as other evidence. A recommendation was submitted to the Cabinet Secretary which met the requirement to retain A&E services at both Ayr and Crosshouse Hospitals and this was approved by the Cabinet Secretary on 27 February This will require significant capital spend on the accident and emergency departments at both Ayr and Crosshouse Hospitals and the creation of combined assessment units at both sites. During 2008/09 an Initial Agreement for this capital spend was submitted to Scottish Government Health Department and has been approved. The Outline Business Case will be submitted to the October 2010 Board meeting. Mental Health In January 2008 the Board considered and approved planned community investments in mental health services. An additional 2.8 million was invested in 2008/09 in mental health services. A Mind Your Health option appraisal was undertaken in 2008 around the future location of acute mental health inpatient services and a consultation exercise was undertaken. The outcome from this was reported to the NHS Board meeting on 19 November 2008 with the preferred option being the move of most adult inpatient services to a new build facility at the Ayrshire Central Hospital site at a capital cost of around 50 million. This has been approved by the Cabinet Secretary and an Initial Agreement for the capital spend was submitted with the Outline Business Case due to come to the August 2010 Board meeting. Capital Schemes As planned, capital expenditure totalling million has been incurred in the year. The following are the main capital spend areas (over 0.5 million) during 2009/ Girvan Community Hospital 11,723 Ayrshire Central Hospital kitchen 2,447 Ayrshire Central Hospital outpatients etc 2,931 North Ayrshire Community Hospital 2,000 Ailsa Hospital - former laundry 861 Patna Clinic 1,912 Theatre Sterile Supplies Unit 620 Sexual Health at Ayrshire Central Hospital 1,479 The Ayr Hospital - endoscopy unit 951 Breast screening expansion 500 Electro medical equipment 3,630 Information management and technology 1,491 Furniture and equipment 1,507 Estates and maintenance 5,350 Page 17 of 136

18 Activity Month 12 - Interyear Comparison / Cumulative MARCH 2008/ /10 Increase/(Decrease) Emergency/Urgent Care Inpatient 4,194 3,549 (645) (15.4%) Assessment/Intermediate Treatment Inpatient 28,316 28, % Assessment/Intermediate Treatment Day Case 8,361 8,137 (224) (2.7%) Assessment/Intermediate Treatment Inpatient and Day Case 36,677 37, % Medical Specialties Inpatient 3,489 4, % Medical Specialties Day Case 2,713 2,261 (452) (16.7%) Medical Specialties Inpatient and Day Case 6,202 6, % Care of the Elderly Inpatient 4,794 4,670 (124) (2.6%) Improving Balance of Care/LTCM Inpatient 1,873 1,759 (114) (6.1%) Improving Balance of Care/LTCM Day Case (436) (72.7%) Improving Balance of Care/LTCM Inpatient and Day Case 2,473 1,923 (550) (22.2%) Ambulatory Care Inpatient 3,087 3,063 (24) (0.8%) Ambulatory Care Day Case 7,023 7, % Ambulatory Care Inpatient and Day Case 10,110 10, % Planned Care Inpatient 12,292 12, % Planned Care Day Case 11,791 11, % Planned Care Inpatient and Day Case 24,083 24, % Children's, Women's & Sexual Health Services Inpatient 11,615 12, % Children's, Women's & Sexual Health Services Day Case 4,682 4,467 (215) (4.6%) Children's, Women's & Sexual Health Services Inpatient and Day Case 16,297 16, % Emergency/Urgent Care OPD New 105, ,478 2, % Total Inpatient 69,660 71,111 1, % Total Day Case 35,170 34,685 (485) (1.4%) Counter Fraud Service The National Counter Fraud Service has calculated an estimated and potential level of fraud for calendar year 2009 in relation to Ayrshire and Arran patients wrongly claiming exemption from dental charges, ophthalmic charges or prescription fee charges. These are based on extrapolation of a small sample and are shown in the table below: Estimated Fraud Potential Fraud Dental Fees 573, ,576 Ophthalmic Fees 95,250 85,900 Pharmacy Fees 506, ,506 Dental The levels of fraud/error and potential fraud/error both show increases in 2009 compared to In the case of the level of fraud/error, the increase is due to increases in the levels of fraud/error in all but one exception category. Ophthalmic The level of fraud/error in 2009 is almost double the level estimated from the Page 18 of 136

19 previous year s exercise, however the level of potential fraud/error in 2009 is less than half the level in Pharmacy The levels of fraud/error and potential fraud/error show a large reduction over those estimated in the previous year s exercise. This can be attributed to a reduction in the rates across a majority of the exemption categories. Page 19 of 136

20 2. Financial performance and position Limit as set by SGHD Actual Outturn Variance (Over)/Under Revenue Resource limit 635, ,948 7,095 2 Capital Resource Limit 36,148 36, Cash Requirement 692, , MEMORANDUM FOR IN YEAR OUTTURN 000 Brought forward surplus from previous financial year 10,012* Excess against in year Revenue Resource Limit (2,917) Cumulative savings against revenue resource limit 7,095 *This figure is brought forward figure under UK GAAP. The revenue resource underspend of 7 million is fully committed for use in 2010/11. The most significant users are shown below:- 000 Decontamination/HAI Week RTT Programme 500 Oral Health Strategy 118 Coronary Heart Disease/Stroke 200 Falls Programme Manager 100 Long Term Conditions Collaborative 91 Local Alcohol Plan 530 Drugs Misuse 130 Smoking Cessation 280 Sexual Health 173 Human Papillomavirus (HPV) 108 Hepatitis C 500 Child Health Weight Initiative 177 Nutrition of Pregnant Women 269 Keep Well 530 Dental Priority Groups 200 Integrated Resource Framework 128 e-health 135 Healthcare Environmental Inspection 245 Total 5,049 Page 20 of 136

21 Balance sheet Under the government accounting arrangements, Health Boards must show liabilities for future years in their accounts without showing funding anticipated from the Scottish Government Health Directorate (SGHD). This has resulted in net current liabilities on the balance sheet. The balance sheet reflects liabilities falling due in future years that are expected to be met by the receipt of funding from the SGHD. Accordingly the accounts have been prepared on the going concern basis. Public Finance Initiative/Public Private Partnerships Ayrshire Maternity Unit (AMU) The AMU is situated within the grounds of Crosshouse Hospital, Kilmarnock and provides obstetric in-patient, neonatal, day case and specialist out-patient facilities for women and babies of Ayrshire and Arran. In previous years this has been treated as an off balance sheet item under UK GAPP. The capital value of the project was 19.5 million, which is now on balance sheet under IFRS. The contract with Ayrshire Hospitals Limited (AHL) commenced on 1 July 2006 and runs for 30 years to 30 June At the end of the contract period the building will transfer free of charge to the NHS Board from the PFI Project Company. East Ayrshire Community Hospital (EACH) EACH is situated in Cumnock and provides in-patient service to frail elderly, elderly with mental illness and GP acute, day facilities to frail elderly and elderly mentally ill and out-patient services to the local area. The assets have a net book value of million on the balance sheet as at 31 March The contract with HBG Construction Scotland Limited commenced in August 2000 and runs for 25 years to August At the end of the contract term the NHS Board has the option to acquire the building at a market valuation price from the PFI Project Company. Page 21 of 136

22 3. Performance against Key Non Financial Targets Ayrshire and Arran Health Board is monitored by the Scottish Government against a number of national targets known as the HEAT Targets. Each Health Board routinely reports performance against trajectories set in a Local Delivery Plan (LDP). The LDP is effectively a contract between the Scottish Government and the Health Board. Trajectories were set against the key targets in the LDP for financial year 2009/10. Outcomes are discussed at an Annual Review meeting held between the Scottish Government and NHS Ayrshire and Arran Health Board. Performance Summary HEAT 2009/10 has 40 key performance indicators in total. The performance has been summarised in the table below, detailing a description of: Indicator; Unit; Baseline performance; Latest performance and performance score; and Target performance. A number of the indicators under the Health Improvement section are only measured every few years, therefore the latest performance figure may be out of date. It should be noted that the following indicators have been updated to reflect performance using more up to date local, but unvalidated data and therefore may be subject to change. These are indicated with a * in the table below. H3.1: Child healthy weight interventions H4.1: Alcohol Brief Interventions H5.1: Suicide Prevention H6.1: Smoking Cessation H7.1: Breastfeeding at 6-8 weeks H8.1: Inequalities Targeted Cardiovascular Health Checks A10a-d: 18 week RTT T4.1: Psychiatric readmissions T12.1: Reduction in emergency bed days (65+) Performance scores are shown in the table below. The key is as follows: GREEN AMBER RED Currently better than trajectory (plan) Currently within 5% of trajectory (plan) Currently outwith the acceptable control limit (5% from plan) Page 22 of 136

23 HEAT indicators 2009/10 NHS Board Meeting Baseline Latest Performance Target Performance ID Indicator Units Date Value Date Actual Planned Score Date Target H2.1 Dental Registrations % of 3-5 year olds Mar % Sep % 83.5% GREEN Jun % H3.1 Child healthy weight interventions* Number of interventions Mar Mar GREEN Mar H4.1 Alcohol Brief Interventions* Number of interventions Dec Mar GREEN Mar-11 6,197 H5.1 Suicide Prevention* % frontline staff trained Dec % Mar % 39.00% RED Dec-10 50% H6.1 Smoking Cessation* Cumulative number of cessations Mar Feb-10 2, RED Dec H7.1 Breastfeeding at 6-8 weeks* H8.1 Inequalities Targeted Cardiovascular Health Checks* % babies exclusive breastfed at 6-8 weeks Cumulative number of health checks delivered Mar % Dec % 19.8% RED Mar % April Mar GREEN Mar E4.1 Day case rates % of Procedures Dec % Aug % 80.28% AMBER Mar-11 82% E4.2 Emergency Inpatient ALOS Days Mar Sep GREEN Mar E4.3 Review to New Outpatient Attendances Ratio Mar Sep GREEN Mar E4.4 New Outpatient DNAs % of Outpatients Mar % Sep % 10% RED Mar % E5.1 Financial Performance 000s Mar-10 7,075 7,000 GREEN Mar-10 7,000 E6.1 Cash Efficiencies 000s Mar-10 22,218 22,078 GREEN Mar-11 33,612 E7.1 Online Triage % of referrals Sep-08 0 Mar % 65% RED Mar-10 65% Page 23 of 136

24 Baseline Latest Performance Target Performance ID Indicator Units Date Value Date Actual Planned Score Date Target E8.1 Energy Consumption GJ Mar Mar n/a n/a Mar E9.1 CHI Utilisation % of radiology requests Apr % Mar % 97% GREEN Apr-10 97% E10.1 eksf % of AfC Staff Apr % Mar % 30% RED Mar-11 80% A Hour Access GP Practice Team % of patients Mar % Mar % 90% GREEN Mar % A8.2 Advance Booking GP % of patients Mar % Mar % 90% RED Mar % A9.1 Suspicion of Cancer Referrals (62 days) % of suspicious referrals Jun % Sep % 95% GREEN Mar-10 95% A9.2 All Cancer Treatment (31 days) % of cancer referrals Jun % Sep % 76.9% AMBER Mar-10 80% A10a A10b A10c A10d 18 week RTT: Admitted Performance* 18 week RTT: Admitted Completeness* 18 week RTT: Nonadmitted Performance* 18 week RTT: Nonadmitted Completeness* % of patients Apr % Mar % 80% RED Dec-10 90% % of clock stops Apr % Mar % 70% GREEN Dec % % of patients Apr % Mar % 85% RED Dec-10 95% % of clock stops Apr % Mar % 70% RED Dec % A10.2 New Outpatients: Max 12 weeks A10.3 Inpatient/Daycase : Max 12 weeks A11.1 Faster Access to Treatment for Drug Misusers Patients Waiting over 12 weeks Patients Waiting over 12 weeks Not available Apr-09 0 Mar GREEN Mar-10 0 Apr Mar RED Mar-10 0 Page 24 of 136

25 Baseline Latest Performance Target Performance ID Indicator Units Date Value Date Actual Planned Score Date Target A12.1 Faster Access to Specialist CAMHS Not available T2.1 CGRM standards Score Mar-07 6 Mar-07 6 n/a n/a Mar T3.1 Anti-depressant prescribing DDDs per capita Jun Dec RED Mar T4.1 Psychiatric readmissions* Readmissions/year Dec Dec GREEN Dec T6.1 Long Term Conditions Rate per 100k pop/yr Mar Mar RED Mar T7.1 Healthcare experience Not available T8.1 Older people cared for at home % of 65+ with care needs Mar % Mar % 37.00% GREEN Mar-10 38% T9.1 Dementia Patients on register Mar Mar RED Mar T10.1 Rate of Attendance at A&E Rate per 100k pop/yr Mar Mar RED Mar T11.1 MRSA/MSSA Reduction Infections per year Mar Dec RED Mar T11.2 C.Diff Reduction Infections per occupied bed days (65+)/yr Mar Dec GREEN Mar T12.1 Reduction in emergency bed days (65+)* Rate per 1,000 pop (65+)/yr Mar Dec GREEN Mar Page 25 of 136

26 HEAT 2009/10 had 40 key performance indicators in total. Of the 40 key indicators, 16 were showing as Red, 2 Amber and the remaining 17 were Green. The performance has been summarised in the table below. The indicators A11.1: Faster Access for Drug Misusers, A12.1: Faster Access to Specialist CAMHS and T7.1: Healthcare Experience have no data available for reporting purposes. Furthermore, the indicator T2.1: CGRM Standards is not shown below as no data update is yet available. Similarly E8.1: Energy Consumption is not included in the list below as a planned level for 2009/10 was not available for comparison purposes. The following indicators scored as RED (outwith 5% of target) H5.1 Suicide Prevention Training H6.1 Smoking Cessation H7.1 Breastfeeding at 6-8 weeks E4.4 New Outpatient DNAs E7.1 Online Triage E10.1 eksf A8.2 Advance Booking - GP A10a 18 weeks RTT: Admitted Performance A10c 18 weeks RTT: Non-admitted Performance A10d 18 weeks RTT: Non-admitted Completeness A10.3 Inpatient/Daycase : Max 12 weeks T3.1 Anti-depressant Prescribing T6.1 Long Term Conditions T9.1 Dementia T10.1 Rate of Attendance at A&E T11.1 MRSA/MSSA Reduction The following indicators scored as AMBER (within 5% of target) E4.1 Day Case Rates A9.2 All Cancer Treatment (31 days) The following indicators scored as GREEN (achieved or exceeding target) H2.1 Dental Registrations H3.1 Child Healthy Weight Interventions H4.1 Alcohol Brief Interventions H8.1 Inequalities Targeted Cardiovascular Health Checks E4.2 Emergency Inpatient ALOS E4.3 Review to New Outpatient Attendances E5.1 Financial Performance E6.1 Cash Efficiencies E9.1 CHI Utilisation A Hour Access GP Practice Team A9.1 Suspicion of Cancer Referrals (62 days) A10b 18 weeks RTT: Admitted Completeness A10.2 New Outpatients: Max 12 weeks T4.1 Psychiatric readmissions T8.1 Older people cared for at home T11.2 C.Diff Reduction T12.1 Reduction in emergency bed days (65+) Page 26 of 136

27 The Board has a Health and Performance Governance committee whose remit includes providing assurance to the Board that systems and procedures are in place to monitor, manage and improve overall performance. A10.KPM3 : Inpatients & Day Cases: Max 12 weeks Latest data are showing a Red with 20 patients waiting more than 12 weeks in March 2010 against a plan of zero people waiting over 12 weeks. These were twenty orthopaedic patients who waited more than 12 weeks. The orthopaedic service has continued to experience significant challenges. A significant shortfall in orthopaedic medical staffing occurred over a two week period in March and despite all efforts to address this through movement of other staff, engaging locums etc., staffing levels fell below that which was considered to be a safe level of ward staffing and elective inpatient surgery was suspended. This resulted in the cancellation of patients some of whom could not be re-accommodated in Ayrshire or the private sector prior to the end of March. All efforts were being made to redress this situation in April. T3.1: Antidepressant Prescribing The Guideline for treatment of depression in primary care is being reviewed and expected to be re-launched later this year. A further internal review of primary care mental health teams (PCMHTs) is underway, which aims to provide a rapid access high volume service for people with mild/moderate depression, through more efficient screening and the use of new Self Help Support workers, together with the safe transfer of people with more complex needs to CMHTs where high intensity psychological therapies will be made available. T6.1: Long Term Conditions and T10.1: Rate of Attendance at A&E General practices in Ayrshire & Arran continue to identify patients at risk of emergency hospital admission and as multidisciplinary/organisational teams are developing anticipatory care plans and self management plans through an enhanced service. Recent analysis of all patients demonstrated that over a 2 year period there has been almost a 40% reduction in the number of admissions for SPARRA (Scottish patients at risk of readmission and admission) patients and a 41% reduction in the total number of bed days. From June 2010 we will commence development of anticipatory care planning with nursing homes. Evidence from the national Long Term Conditions Collaborative has shown some board areas achieving 40% reductions in emergency admissions from nursing homes. Three tele-healthcare projects with respective local authorities, community hospitals and primary/community care teams are proposed which will focus on chronic obstructive pulmonary disease (COPD), Heart Failure and complex high risk patients awaiting discharge from hospital. T9.KPM1: Dementia Page 27 of 136

28 An intensive period of data checking and case searching is planned for all GP practices in Ayrshire. Positive results have been demonstrated from a review of pilot practices in Arran. All GPs have been communicated with about this work and a more detailed report on overall findings will be made available by July The anticipated outcome of the workplan being taken forward over the course of the next year, which itself is based on careful planning and preparation to maximise effort, is reflected in the revised trajectory set for the period April 2010 to March T11.KPM1 : MRSA/MSSA bacterium: 30% Reduction A new Staphylococcus aureus Bacteraemia (SAB) HEAT Target has been introduced for 2010/11. An Action Plan detailing the measures being taken by NHS Ayrshire and Arran to reduce the numbers of SABs was submitted to the SGHD Healthcare Acquired Infection (HAI) Policy Team on the 31 March Actions contained in the Plan include a spread plan for HAI related care bundles; detailed specific renal action plan; implementation of revised surveillance methodology; and Peripheral Vascular Catheter audit. It should be noted that the SGHD HAI Policy Unit request unverified SAB data from the Infection Control Team on a monthly basis. Page 28 of 136

29 REMUNERATION REPORT BOARD MEMBERS AND SENIOR EMPLOYEES REMUNERATION The Health Board has a Remuneration Committee which is a sub-committee of the Staff Governance Committee. ship is wholly non-executive as follows:- Professor W Stevely Councillor D O Neill Mrs R Miller Mr J Callaghan The committee met four times during 2009/10. The committee is responsible for determining and regularly reviewing the Health Board s pay policy, subject to constraints imposed by national conditions and guidance. The committee also agrees the individual in-year objectives of the Board s executive directors. The Remuneration Committee is required to approve the annual performance assessment of executive directors in June each year. Remuneration Remuneration of board members and senior employees is determined in line with directions issued by the Scottish Government. All posts at this level are subject to rigorous job evaluation arrangements and the pay scales applied reflect the outcomes of these processes. All extant policy guidance issued by the SGHD has been appropriately applied and agreed by the Remuneration Committee. Performance Appraisal Performance appraisals for executive members are carried out in line with the guidance from the Scottish Government and overseen by the Remuneration Committee. Annual pay rises for executive directors are dependent on achieving specified levels of performance. Payments to past senior managers No payments were made to past senior managers during 2009/10. The following tables provide a breakdown of executive and non-executive directors remuneration in 2008/09 and 2009/10 and have been audited. Page 29 of 136

30 Ayrshire and Arran Health Board Remuneration Report FOR THE YEAR ENDED 31 MARCH 2009 Salary (Bands of 5,000) Real Increases in pension at age 60 (Bands of 2,500) Total Pension Accrued at age 60 at 31 March (Bands of 5,000) Cash Equivalent Transfer Value (CETV) at March 2008 Cash Equivalent Transfer Value (CETV) at March 2009 Real increase in CETV in year Benefits in Kind '000 '000 '000 '000 '000 '000 '000 Remuneration of: Executive s Chief Executive: W Hatton * * * * * Director of Public Health: C Davidson Director of Finance: D Lindsay Director of Policy,Planning and Performance: A Gunning Medical Director: R Masterton Nurse Director: F McQueen Director of Organisational & HR Development: C Lisle Non Executive s Chair: W Stevely M Cheyne D O'Neill R Miller C Duncan E O'Connell D Price K Darwent Dr H McCallum(from 1 March 2009) *** W Hislop AG McHattie(until 28 February 2009) *** D Filson R Reid G Watson J Dever J Callaghan *consent to disclosure withheld ***Remuneration Waived 2,743 3, Page 30 of 136

31 Ayrshire and Arran Health Board Remuneration Report FOR THE YEAR ENDED 31 MARCH 2010 Salary (Bands of 5,000) Real Increases in pension at age 60 (Bands of 2,500) Total Pension Accrued at age 60 at 31 March (Bands of 5,000) Cash Equivalent Transfer Value (CETV) at March 2009 Cash Equivalent Transfer Value (CETV) at March 2010 Real increase in CETV in year Benefits in Kind '000 '000 '000 '000 '000 '000 '000 Remuneration of: Executive s Chief Executive: W Hatton * * * * * Director of Public Health: C Davidson Director of Finance: D Lindsay Director of Policy,Planning and Performance: A Gunning Medical Director: R Masterton Nurse Director: F McQueen Director of Organisational & HR Development: C Lisle (until ) Non Executive s Chair: W Stevely M Cheyne D O'Neill R Miller C Duncan E O'Connell D Price K Darwent Dr H McCallum W Hislop D Filson R Reid (until 28 February 2010) G Watson J Dever J Callaghan (employee director) H Hunter (from 1 March 2010) *consent to disclosure withheld 3,453 3, NOTE: The opening CETV for March 2009 is different from the closing balance in the accounts for 31 March This is because the CETV calculator is obtained from the civil service pensions and is updated for the NHS pension scheme for factors advised by the Government Actuary's Department (GAD) The employee directors salary includes 40,000-45,000 in respect of non Board duties. Signed... Date... Chief Executive as Accountable Officer Page 31 of 136