Capital Programme to

Transcription

1 Aneurin Bevan University Health Board Capital Programme to Introduction This paper updates the Board on the Capital Programme for and future years. The Board is requested to: Note the position regarding the 2014/15 to 2015/16 capital programme. Note that Discretionary Capital availability significantly exceeds demand and that a process that has been put in place to robustly risk assess all Divisional / Directorate requirements. Note that further work is now underway with Welsh Government to assess how the Health Board may be able to access strategic capital for service transformation and development in future years. Financial Assessment and link to Financial Recovery Plan Risk Assessment Annual Quality Framework Standards for Health Services Wales Equality Impact Assessment Child Impact Assessment This report considers the Capital Programme. This is made up of the Discretionary Capital Programme and all-wales capital schemes. The total value is expressed as the Capital Resource Limit (CRL). All schemes are subject to individual risk assessments as a standard requirement of the Health Board s Capital Procedures. There is significant risk associated with unmet capital need within ABUHB A number of current schemes contribute to the achievement of the AQF and next steps implementation of Clinical Futures. Information on the capital programme, the estate and individual projects is supplied when required for SHS review purposes. Individual project level requirement. Individual project level requirement as necessary

2 2. Current Funding Position Table 1 below sets out the overall capital funding position for :- Funded Funding not Confirmed Total Source Discretionary capital Total Discretionary in CRL 5,676 5,676 Add NBV from Sale Proceeds Sub Total Discretionary Capital 5, ,726 All Wales schemes:- SCCC Funding in CRL 9,466 9,466 Health Technology Funding Diagnostic Equipment Funding 1,800 1,800 Sub Total All Wales Schemes 9,786 1,800 11,586 Total to Allocate 15,462 1,850 17,312 It should be noted that: ABUHB currently receives discretionary capital funding of 5.676M and has approved All-Wales Capital Programme (AWCP) funding of 9.786M mainly relating to the Full Business Case phase of the Specialist and Critical Care Centre project. The AWCP also contains a sum of 320k agreed by Welsh Government last year for a Mental Health Health Technology Fund Bid. The 1.8m diagnostic equipment funding included in the second column has been identified as a capital requirement in a recent submission to Welsh Government and is provisionally included subject to their approval. 50K of capital disposals are assumed for The Discretionary Capital position for and future years (as at 9 July 2014) is set out in Table 2 overleaf: - 2 -

3 The main points to note in 2014/15 are: Aneurin Bevan University Health Board 2014/15 Forecast Plan Spend to date Forecast outturn Variance 2015/ / / /19 Source Total Discretionary in CRL 5,676 5,676 5,676 5,676 5,676 Add Forecast NBV of Disposed Properties Total Discretionary Funding 5,726 5,776 5,676 5,676 5,676 Applications: Min Allowance Direct Service Allocations: Statutory maintenance H&S Fire Safety allocation Imaging - X Ray Tube Replacement Total Direct Service Allocations Commitment B/f from 2013/14 Completion of A&T SCA DEXA Scanner HB Wide Defibrilator replacement NHH PFI Equipment Blaenavon Resource Centre IT Blaenavon Dental Requirements Total Commitments B/forward 1, , Total 2014/15 Commitments 1, , Priority Schemes Sustainability NICU (B6) ,000 Sustainability Maternity etc (B5) Reconfiguration of A&E RGH ,700 Women's Health Unit, B Estate Rationalisation, LGH Decant Ph Total Priority Schemes 2, , , Approvals Quarter 1 MAU Isolation Rooms Critical IT Replacements Replacement Path Anerobic Workstation Total Approvals Quarter Contingency Total 4, , , Balance of available funding 1, ,701 4,701 4,701 The standard opening allocations are included for Estate, Fire and X-ray tubes albeit at a minimal level totalling 0.475m. (In 2013 the total funding for these areas amounted to 1.020m. The total risk assessed requirement is described later in section 3 of this paper). There is a figure of 1.485m of commitments and approvals brought forward from detailed in Table 2 above. Just over 2m has been identified for potential service sustainability capital schemes in response to issues identified in Divisional 3 year plans primarily related to Family and Therapies services. This includes the proposed Woman s Health Unit (B7) and priority schemes being developed to sustain services for maternity and neonatal intensive care facilities. These schemes will require individual Board level approval of supporting Business Cases. As in previous years, a contingency of 0.5m will be retained at this stage of the financial year to allow for any unforeseen circumstances.

4 A number of urgent approvals totalling 191k have been issued in June for areas with legal or statutory risks. Taking all of the above issues into account there is currently 1.038M available to allocate in This will be insufficient to support the range of priority areas set out in Section 3 including ward upgrade programme, additional capacity linked to winter pressures, divisional capital funding priorities and critical equipment replacement as well as those areas that the Board may wish to consider such as RGH Main entrance and ABHB-wide car park management. The RGH Cath lab replacement project is currently assumed to form part of an All Wales Capital-funded programme but if this does not occur this will lead to a demand within ABUHB for at least 1.5m spread equally over 2014/15 and 2015/16. This potential commitment is not reflected in the table above. There is still uncertainty about any additional funds that may be released by Welsh Government towards the end of the year and it is therefore our strategy as in to manage this uncertainty by addressing procurement and other issues in advance so we are in a position benefit fully from any late capital provided by Welsh Government should this occur in From 2015/16 onwards, the critical points for the Board to note are as follows: Subject to Business Case approvals there is a continuing commitment to Family and Therapies sustainability projects in Maternity and Neonatal services amounting to an estimated 1.85m. There is a potential second phase of Family and Therapy sustainability projects relating to Paediatrics and the Children s Assessment Unit. A capital contribution of 2.7m (possibly over three phases) has been identified as a minimum requirement for improvements to the Emergency Department at RGH to allow for environmental and flow improvements as well as interim expansion of the department to accommodate possible shifts in service activity (both from within and potentially from outside of our catchment areas). This is an estimate at this stage subject to more detailed planning and will also be subject to a detailed Business Case. Taking these issues into account, together with direct service allocations and the need for a contingency, this will leave just 251k for all other Health Board capital requirements. 3. Capital Requirements and Risk Assessment It is very clear from the above summary that there is a key requirement for capital to sustain service delivery. It is also clear that the balance will not be sufficient to meet the other capital demands of the Health Board, including: - 4 -

5 Fire Safety Estate Risk Fully depreciated diagnostic and general equipment replacement including ultrasound ICT infrastructure Other Corporate development priorities such as DHR Environment and Ward Upgrades This is evidenced by Table 3 below which summarises the forecast discretionary funding and identified divisional capital needs over the next few years, a more detailed tabled is attached at Appendix 1. It also includes potential capital schemes some of which require further work to generate costed plans and programmes: Forecast Costs Division 2014/ / / / /19 Total Community ,469 Corporate 710 1,817 1, ,927 Estates - Statutory 1,056 1,640 2, ,036 Facilities 2,260 1,847 1, ,707 Family & Therapies 431 1, ,003 H&S Fire 819 1, ,663 Informatics 755 2,715 1, ,720 MH & LD Primary Radiology 1,840 2,996 2, ,684 Scheduled 2,944 3,057 3, ,725 Unscheduled 2,092 1, ,912 Total 13,251 19,087 13,567 10,425 8,202 64,532 Balance of Discretionary Funding -1, ,701-4,701-4,701-15,392 Shortfall of Funding to meet Demand 12,214 18,836 8,866 5,724 3,501 49,140 From the Table 3 above it can be seen that: Available discretionary funding as seen earlier in Table 2 is currently assumed to amount to a total of 15.4M over the three years. Costed divisional demand amounts to 64.5M over the same period. It is assumed that in most areas there will also be further unforeseen capital requirements in the period covered by this programme and this is not currently reflected in the table. The costed capital need in Table 3 above includes costs of items where a bid has also been made to the AWCP (discussed in section 4 below).the HB will have to use discretionary if AWCP funding is not forthcoming, i.e. diagnostic equipment replacement statutory compliance. For other schemes it is assumed that if there is no AWCP funding available that scheme cannot proceed on a capital route. We now require a much more sophisticated, transparent and robust system to assess real need and the risk that the organisation could face if that need cannot be met

6 This will then allow the Board and Welsh Government to be fully appraised of the real risks associated with our unmet capital need and to provide reassurance that we have measures in place to identify and where possible mitigate that risk. To achieve this, a process has been put in place with Divisions / Directorates. Each Division has been asked to:- 1. Undertake a thorough review all outstanding capital requirements 2. Remove any capital bids which are no longer required. 3. Risk assess remaining bids based on probability and likely impact 4. Provide a brief narrative to justify / explain the risk scores given. 5. Describe measures that will be put in place to mitigate the risk should capital funding not be available. It is proposed to consolidate the information resulting from the above process into a more comprehensive report to be available to the Planning and Strategic Change sub-committee in the first instance and subsequent reporting to the Board over the next three months. 4.0 All-Wales Capital Programme The Health Board has been required to submit supplementary pro-formas to Welsh Government for any capital which was identified in the Medium Term Plan for potential the All Wales Capital Funding. The following were submitted: Specialist Critical Care Centre Local General Hospital development at RGH and NHH Primary Care developments Major Diagnostic Equipment ICT Patient Flow Management System Estate Risk Invest to save Accommodation Project LD Assessment and Treatment Unit Cardiac Cath Lab (assumed to be part of an all-wales programme) These are not formal bids and there is no indication if funding will be made available. It should be noted that it is not currently proposed to bid to Welsh Government for interim sustainability due to the time associated with the approval process and the assumption that they are unlikely to fund short term developments which in some cases may not be required following commissioning of the SCCC. Further work is underway with Welsh Government to assess how Local Health Boards may be able to access strategic capital for service transformation and development in future years and in the current year it is not yet clear whether any further Capital will be released by Welsh Government on a planned basis for either purely Discretionary use by Health Boards or as ring-fenced allocations prioritised by them

7 5.0 Action Required by the Board The Board is requested to: Note the position regarding the 2014/15 to 2015/16 capital programme. Note that discretionary capital availability significantly exceeds demand and the process that has been put in place to robustly risk-assess all Divisional / Directorate requirements. Note that further work is now underway with Welsh Government to assess how the Health Board may be able to access strategic capital for service transformation and development in future years Sponsored by: Richard Bowen Director of Planning Prepared by: Andrew Walker Chris Hopper Rosie Cavill On behalf of the Capital Group Date: 9 July