CENTRAL MANCHESTER UNIVERSITY HOSPITALS NHS FOUNDATION TRUST

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1 CENTRAL MANCHESTER UNIVERSITY HOSPITALS NHS FOUNDATION TRUST Agenda Item 8.2 Report of: Paper prepared by: Executive Director of Strategy Director Single Hospital Service Programme Date of paper: 13 March 2017 Subject: Purpose of Report: Single Hospital Service Programme Indicate which by Information to note Support Resolution Approval Consideration of Risk against Key Priorities (Impact of report on key priorities and risks to give assurance to the Board that its decisions are effectively delivering the Trust s strategy in a risk aware manner). The development of a collaborative approach to hospital service provision in Manchester will, over a strategic timescale, facilitate delivery of the Trust s key priorities in respect of: - Delivering safe, harm-free care focusing on evidence based pathways, supervision and clinical leadership. - Exceeding all key NHS commissioned standards and deliverables, including access and quality outcomes. - Maintaining financial stability in an environment of increasing financial challenge. Maintaining the current competitive environment will present a risk against delivery of these priorities. Recommendations The Board of Directors is asked to note the current position of the Single Hospital Service Programme. Contact Name: Peter Blythin Tel:

2 1. Introduction This report provides the Board of Directors with an update on the latest position of the programme to create a Single Hospital Service for the City of Manchester. 2. Progress to date Governance The previously established programme governance arrangements, centred on the Joint Sub Committee and the Programme Board, continue to function effectively. As part of these arrangements work has been completed to test the timeline for achievement of the transaction, notably the merger of Central Manchester University Hospitals NHS Foundation Trust (CMFT) and University Hospital South Manchester NHS Foundation Trust (UHSM) as an essential precursor to the transfer of NMGH to the new Foundation Trust. This work has reaffirmed the integrity of the existing target dates. With the submission of the competition and benefits cases to the CMA as planned the priority now is to ensure the Full Business Case, Long Term Financial Model and Post Merger Implementation Plan are firmed up by the end of March and submitted to NHS Improvement for risk rating. Governor engagement Work is continuing to engage the Councils of Governors of CMFT and UHSM to ensure they are adequately supported to undertake their role in the merger process. In addition to the effort both Trusts have undertaken with their respective Councils of Governors in recent months a series of joint CMFT / UHSM Council of Governors meetings is now underway. Following feedback from the first of these events in December, the second event on 15 February focussed on clinical benefits to be derived from the proposed merger. Governors heard about the overall benefits of the merger from the Trusts most senior clinical leaders and were presented with details of two specific cases; orthopaedics and women s health and maternity services where there is the clear potential for benefits in terms of clinical outcomes and patient experience. Feedback from the event was very positive and Governors welcomed the opportunity to hear from clinicians directly involved in developing the benefits cases. As part of the package of support to Governors they were presented with written guidance on various aspects of the Programme which will be updated regularly and which provides Governors with an ongoing source of reference about the transaction. Further dates for joint events are planned for March and April The March event will include a presentation on potential improvements in cardiac care and will also provide Governors with the opportunity to give their views on the proposed names for the new organisation. In response to a request at the first event, both sets of Governors received presentations on the Programme Risk Register during February. Arrangements are also being made to provide Governors with independent legal advice as part of the preparations for voting on the assurance processes and related matters associated with the anticipated merger. 2

3 New Constitution There is a requirement for the Full Business Case to include details of the proposed Constitution for the merged Trust including the intended composition of the Council of Governors. This needs to be developed with input from the Boards of Directors and Councils of Governors of both Trusts. To facilitate this, a Joint Working Group is being established Co-Chaired by both Trust Chairmen and comprising Directors of Strategy, SHS Programme Team members and representatives from public, staff and appointed Governor constituencies for both Trusts. The first meeting of this Group is due to take place later in the month. Engagement with NHS Improvement and the Competition and Markets Authority (CMA) Following submission of the formal Stage 2 Clinical Benefits Case on 31 January 2017, and a subsequent meeting with the CMA on 3 February, the CMA notified its intention on 9 February to fast-track Phase 1 assessment starting on the 10 February. The CMA issued a series of constructive lines of enquiry relating to the benefits case following the meeting on the 3 February. Central themes related to implementation and deliverability of identified benefits and a request for more detail on workforce issues. The SHS Programme Team will make a formal submission to the CMA w/c 13 March. In tandem with the continuing work on the benefits case the CMA issued its intention to proceed to the Phase 2 assessment process on 27 February This will run for a minimum period of 24 weeks. Phase two will introduce a period of intense scrutiny by the CMA and as such be demanding on CMFT / UHSM Boards of Directors and the SHS Programme Team. Terms of Reference for the Phase Two review are included in Annex One Greater Manchester Transformation Fund Funding in respect of the first tranche of GMTF monies is now flowing in to Manchester, and an Investment Agreement in respect of the second tranche is in a final draft form. A comprehensive investment proposition for all of the initiatives in the Manchester Locality Plan, including the full costs associated with the SHS Programme, was submitted to the GM, supported by a Cost Benefit Analysis (CBA) of the SHS Project 1 (UHSM/CMFT merger), at the end of January. Evaluation by the GM Team is currently underway. CQC REGISTRATION Following initial discussions with the CQC about the process for registration of the proposed new Foundation Trust, executive leads from the two Trusts have been identified to work with the Director SHS Programme. The intention is to establish a task and finish group involving CQC national and regional staff to co-ordinate the registration process. The aim is to begin the process of registration application well in advance of the weeks normally required. The CQC has requested a minimum of 20 weeks prior to the registration of the new organisation due to the scale and complexity of the proposed merger. 3

4 The task and finish group intends to hold its first meeting later this month. 3. Recommendations The Board of Directors is asked to; (i) Note the current position of the Single Hospital Service Programme. 4

Anticipated merger between Central Manchester University Hospitals NHS Foundation Trust and University Hospital of South Manchester NHS Foundation Trust Terms of reference 1.

5 Anticipated merger between Central Manchester University Hospitals NHS Foundation Trust and University Hospital of South Manchester NHS Foundation Trust Terms of reference 1. In exercise of its duty under section 33(1) of the Enterprise Act 2002 (the Act) the Competition and Markets Authority (CMA) believes that it is or may be the case that: (a) arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation, in that: (i) enterprises carried on by Central Manchester University Hospitals NHS Foundation Trust will cease to be distinct from enterprises carried on by University Hospital of South Manchester NHS Foundation Trust; and (ii) the condition specified in section 23(1)(b) of the Act is satisfied; and (b) the creation of that situation may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom for goods or services, including the supply of several acute elective specialties and maternity services. 2. Therefore, in exercise of its duty under section 33(1) of the Act, the CMA hereby makes a reference to its chair for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013 in order that the group may investigate and report, within a period ending on 13 August 2017, on the following questions in accordance with section 36(1) of the Act: (a) whether arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation; and 5

6 (b) if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services. Sheldon Mills Senior Director, Mergers Competition and Markets Authority 27 February

CENTRAL MANCHESTER UNIVERSITY HOSPITALS NHS FOUNDATION TRUST

CENTRAL MANCHESTER UNIVERSITY HOSPITALS NHS FOUNDATION TRUST Agenda Item 8.3 Report of: Paper prepared by: Executive Director of Human & Corporate Resources Margot Johnson Director of Corporate Services