Approve Assure Note. Board of Directors Meeting Report 31 July Agenda item 254/13. Title. Sponsoring Director. Authors.

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1 Board of Directors Meeting Report 31 July 213 Agenda item 254/13 Title Quarter One Cost Improvement Programme Update Sponsoring Director Jacqueline Totterdell Chief Executive Authors Purpose Liam Slattery Head of Change & Programme Management To update the Trust Board on the performance of the Cost Improvement Programme Previously considered at April Board Executive Summary This paper provides information on the performance of the Trust s Cost Improvement Programme. This covers both financial delivery and the management of change and risk within the programme. Related Trust Objective Related Risk Legal implications / regulatory requirements Quality impact assessment Equality impact assessment Action required by the Board Sustainability - keep the core strong Sustainability - keep the core strong risk 4. Financial pressures prevent delivery of strategic objectives. The Trust is required to report performance of its CIP as part of the financial planning provided to Monitor. The managed delivery of the Trust Cost Improvement Programme ensures cost savings are achieved without negative impact on service quality As far as can be considered, this paper has no detrimental impact for the 8 protected characteristics under the Equality Act 21 Approve Assure Note Page 1

2 Quarter 2 Cost Improvement Programme Update Background The Trust s Cost Improvement Programme (CIP) for 213/14 has been targeted with achieving a 1.27m saving. As part of the financial governance of the Trust, the Programme Management Office (PMO) is charged with the provision of quarterly reports to the Board. Current Issues Headlines o The programme for 213/14 is currently valued at 9.16m (89% of target). o The year-end risk adjusted forecast is 7.15m (7% of target). Performance to Month 3 o The programme has delivered 1.16m to month three against a plan of 1.63m. o The value of recurrent savings is 6k below plan; this will need to be addressed to avoid increasing pressure on next year CIP target. o The value of delivery is below plan across all three areas; Pay, Non-Pay and Income o None of delivery within the programme is from unplanned underspends. Performance to Month 3 Profile ( ) Actual ( ) Variance ( ) Total Recurrent Non-Recurrent Pay Non-Pay Income Planned Unplanned n/a n/a Page 2

3 12 Monthly Delivery Profile Actual Delivery Monitor Rephased Plan Forecast Delivery s Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar The programme submitted to monitor featured a high number of schemes still in development. A flat 12 th s profile was assumed in the submission for all schemes without worked up profiles. Further to completing the work up of those schemes a more accurate profile has been established. Both profiles are shown on the graphs on this page along with forecasts based on delivery to M3. Cumulative Plans for Monitor, Rephased Plan, Actual and Forecast Delivery Actual Delivery Monitor Rephased plan Forecast Delivery 12, 1, 8, s 6, 4, 2, 1, Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Page 3

4 Programme Risk Theree are currently 23 live* schemes in the programme, of whichh 61 are failing to deliver to plan. This has resulted in 2.1m being identified at risk. Total Value at Risk (s) 19 1,992 1,,887 7, of the poor performing schemes have delivered less than 75% of their plan delivery to date, 33 of whichh have failed to deliver any savings in thee quarter. Profiles forr these schemes have either been reduced by the manager responsible or have had risk value** marked against its planned year end position. * live includes schemes which have deliveredd savings ahead of plan, p hencee the discrepancy between this figure and those referenced in the Quality & Equalityy Impact Assessments section of this report. ** The risk value is calculated by establishing the percentage of under delivery and applying thatt across the remaining profile (i.e. if a scheme has delivered 5% of what wass planned to t date the value of risk will be equal to 5% off what is planned to be delivered in the following months. Page 4

5 Quality and Equality Impact Assessments The PMO is monitoring Key Performance Indicators (KPIs) on all schemes for which Quality Impact Assessment (QIA) KPI s have been requested. There are 224 schemes in the programme. 117 schemes have been assessed and signed off as not requiring any monitoring. 53 schemes are not due to commence delivery until later in the year and therefore monitoring has not started. At the end of the first quarter reviews: o 43 schemes with monitoring being developed. o 26 have already started delivering savings (PMO leads will be addressing this as a matter of urgency with managers responsible). o 11 schemes are being monitored by the PMO: 1 had completed monitoring with no reported issues. 1 had not completed monitoring; HR14 Albon Contract. The scheme has not delivered any saving and it likely to be removed therefore no monitoring completed. The Executive team will be discussing results of QIA monitoring with Business Units at the Corporate Team meeting and in monthly BU reviews. They will seek assurance that there has been no negative impact on patient safety or quality of care as a result of this programme. The Trust s Diversity Manager has reviewed 195 of the schemes returning no issues. The remaining 29 schemes are with the Diversity Manager for review and the PMO are awaiting feedback. 214/15 Programme The programme for 214/15 has 37 schemes valued at 643k. Included in the total value is 623k from estimated carry forwards from the 213/14 programme. Next Steps Address the shortfall in delivery, focussing on recovering the planned delivery of recurrent savings so as to avoid increasing pressure on next year s CIP target. Page 5 Complete the set-up of QIA KPI monitoring for all schemes which require this, prioritising those with delivery already seen in quarter 1.