Finance, Performance and Strategic Planning Committee Terms of Reference Document Control: Document Document Owner: Board of Directors JPUH Finance, Performance and Strategic Planning Electronic File Name: Committee Terms of Reference Document Type: Corporate Terms of Reference Stakeholder Consultation: Reader Panel (as described within this document) and Board of Directors Approval Level: Board of Directors Approval Body: Chair of Board of Directors Version Reference 1.3 Number: Number: Version Issue Date: February 2014 Effective Date: February 2014 Review Frequency: Annually Method of Dissemination: Intranet FPSPC, FPSP, Finance Committee, Performance Committee, Search Keywords: Strategic Planning Committee, Finance Performance and Strategic Planning Committee For Use By: All Staff Version History: Version Date Author Reason V1.0 September Deputy Director of To originate document 2013 Finance V1.1 November 2013 Deputy Director of Finance Director of Finance, Performance and Strategic Planning Review V1.2 December 2013 Deputy Director of Finance Head of Communications & Trust Secretary Review V1.3 February 2014 Deputy Director of Finance V1.4 V1.5 Amendments per January 2014 Committee meeting Ref: TOR/FPSPC/MF1202/01 Page 1 of 8
CONTENTS 1.0 FUNDAMENTAL AIMS... 3 1.1 THE MAIN AIMS OF THE GROUP ARE AS FOLLOWS:... 3 1.2 REPORTING ARRANGEMENTS... 5 1.3 ACCOUNTABILITY... 6 1.4 RELATIONSHIP WITH THE AUDIT COMMITTEE... 6 1.5 TRUST VALUES... 6 1.6 DISTRIBUTION CONTROL... 7 2.0 FORUM MECHANICS... 7 2.1 MEETINGS... 7 2.2 DOCUMENTATION... 7 2.3 MEMBERSHIP AND QUORUM... 7 2.4 MONITORING... 8 Ref: TOR/FPSPC/MF1202/01 Page 2 of 8
1.0 FUNDAMENTAL AIMS The Board hereby resolves to establish a non-executive led Committee of the Board to be known as the Finance, Performance and Strategic Planning Committee (The Committee). The Committee is a non-executive committee of the Board and has no executive powers, other than those specifically delegated in these terms of reference. The Finance, Performance and Strategic Planning Committee provides an objective view of the financial and performance position of the Trust and will act to oversee the delivery of achieving financial, activity and operational performance targets, making any decisions delegated to it. The Committee is distinct and separate from the Audit Committee and will act to minimise any possible areas of overlap between these two Committees. 1.1 The main aims of the group are as follows: The duties of The Finance, Performance and Strategic Planning Committee can be categorised as follows; Financial Strategy and Business Planning Consider the Financial Strategy, ensuring that financial objectives are aligned with the Trust s overall objectives, strategic vision and direction; Receive a summary of the financial model outputs as required by the sector regulator for health services in England, Monitor including all underpinning short, medium and long term planning assumptions prior to submission; Receive a summary from Executive leads of key publications including Monitor/ LAT/ NHS England and Commissioning organisations that may have an impact on the financial and operating environment and link to planning assumptions and financial modelling; Review the Annual Monitor Plan prior to submission to the Board for approval; and Consider the Trust s Strategic and Integrated Business Planning activities, ensuring that strategic planning objectives are aligned with the Trust s overall objectives, strategic vision and direction. Review any potential impact specifically related to Operational performance Budget Setting Review and agree a work plan and budget setting timetable for forward year budget setting and monitor progress against this; Approve the Budget setting strategy and any related policy or guidelines; and Review the draft annual financial plan and budget including income statement position, capital plan and overall financial risk ratings ensuring it is within the overall financial strategy and direction of the Trust as determined by the Board of Directors. Review any risks associated with operational performance within financial envelope Ref: TOR/FPSPC/MF1202/01 Page 3 of 8
Monitoring Performance The Committee will monitor the progress towards achievement of the financial strategy and financial targets, and operational performance associated activity levels and how these relate to the performance of the Trust in non-financial terms including patient safety and effectiveness. The Committee shall; Receive regular reports in relation to financial, activity and operational performance, including; o Performance of overall financial risk rating; o Financial performance of Income statement, Balance Sheet and Cashflow; o Financial performance against Capital programme; o Financial performance at divisional level; o Performance against the cost improvement programme; o Activity performance against contract; and o Tracking of progress against agreed CQUIN schemes and related financial, operational and quality performance implications. Monitor divisional scorecard activity including financial and operational performance metrics; Review and challenge progress against action plans in relation to operational performance as required e.g. RTT targets or stroke performance; Scrutinise financial, activity and operational performance, trends, projections and underlying data on a monthly basis through a rolling programme of monitoring of divisional performance so that assurance can be sought around any action plans that address emerging patterns in financial, activity or operational performance; and Review and develop reporting in respect of financial and operational performance. Financial Risk Management The Finance, Performance and Strategic Planning Committee shall review all significant financial risks, including the Monitor risk rating in light of the Trust s current overall financial performance. The Audit Committee will retain oversight of the Risk Management function overall. Contract Management and Commercial Matters Ensure effective planning mechanisms are in place with Commissioners of healthcare to agree annual or longer term contracts as may be appropriate; Seek to ensure any financial or operational risks arising from those contracts are mitigated to an acceptable level; Review financial and activity and quality performance against contract and ensure any corrective action is taken; and Consider any Commercial Matters as may be deemed necessary by the Director of Finance. Ref: TOR/FPSPC/MF1202/01 Page 4 of 8
Business Cases and Investment Appraisal Approve the Trust s Business Case Process; Perform a preliminary review of proposed major investments where the value is in excess of 1m; Receive finalised Business Cases for major investment and recommend for approval by the Board of Directors; and Receive a report on Business Cases that have been approved by Trust Investment Group or Hospital Management Group; Capital and Asset Management Oversee the development of the rolling capital programme including scrutiny of the prioritisation process; Monitor performance against the Capital plan including any metrics set by the lead regulator Monitor in this respect; and Consider issues related with the Trust s Estate including Revaluation exercises, rationalisation and related financial impact. CIP & Transformation Approve the process for developing the CIP and Transformation plan; Receive the finalised CIP/Transformation plan from the Transformation Board; and Receive regular reports in relation to performance against the plan and review the actions identified to mitigate any underperformance. Other Matters Be provided with any ad-hoc reports as deemed required by the Committee; Review Treasury Management performance; and Consider such other matters and take such other decisions of a generally financial or commercial nature as the Board of Directors may delegate to it. 1.2 Reporting Arrangements The minutes of Finance, Performance and Strategic Planning Committee meetings shall be formally recorded and submitted to the Board of Directors in Private. The Chair of The Finance, Performance and Strategic Planning Committee shall draw to the attention of The Board any issues that require disclosure to the full Board, or that require executive action. Ref: TOR/FPSPC/MF1202/01 Page 5 of 8
1.3 Accountability The Finance, Performance and Strategic Planning Committee is constituted as a standing Committee of the Trust s Board of Directors. Its constitution and terms of reference shall be as set out within this document, subject to amendment at future Board of Directors meetings. The Committee is authorised by the Board of Directors to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any member of staff and all members of staff are directed to co-operate with any request made by The Committee. The Finance, Performance and Strategic Planning Committee is authorised by the Board of Directors to obtain outside legal or other independent professional advice. The Committee is authorised by the Board of Directors to request the attendance of individuals and authorities from outside the Trust with relevant experience and expertise if it considers this necessary or expedient to the carrying out of its functions. 1.4 Relationship with the Audit Committee As a Committee of the Board of Directors, it is important that The Finance, Performance and Strategic Planning Committee reduces the risk of overlap with the Audit Committee. Therefore the following specific areas of responsibility will be excluded from The Finance, Performance and Strategic Planning Committee agenda; Internal & External Audit; Local Counter Fraud Specialist work; Approval of Financial Statements; Approval of Quality Accounts; Risk Assurance Framework / Business Assurance oversight; and Control, review and oversight of the Standing Financial Instructions document including the scheme of delegation. 1.5 Relationship with the Safety, Quality & Governance Committee There is dual membership between the Safety and Quality Governance Committee and the Finance, Performance and Strategic Planning Committee and any matters requiring attention will be referred through the Chairman of each Committee. Members of the both Committees are members of the Board of Directors. In order to reduce overlap between both committees the following specific areas of responsibility will be excluded from the The Finance, Performance and Strategic Planning Committee agenda: Approval of the Trust's Annual Quality Report which includes a review of performance in the prior year; Monitoring the Trust s compliance with the standards of the Care Quality Commission, NHSLA, CNST and other clinical quality standards; Monitoring of performance against recommendations from NICE, including the NICE Quality Standards, Confidential Enquiries and other clinical guidelines such as those published by the Royal Colleges; Monitoring of performance in relation to recommendations from national reports such as Francis, Keogh, Berwick and Clwyd. Ref: TOR/FPSPC/MF1202/01 Page 6 of 8
The Finance, Performance and Strategic Planning Committee will however monitor performance against all indicators within the Quality and Performance Dashboard including those related to quality performance such as CQUIN, A&E and stroke performance. 1.6 Trust Values These Terms of Reference conform to the Trust s values of putting patients first, aiming to get it right, recognising that everybody counts and doing everything openly and honestly. 1.7 Distribution Control Printed copies of this document should be considered out of date. The most up to date version is available from the Trust Intranet. 2.0 FORUM MECHANICS The Board of Directors is responsible for ensuring effective internal control including: Management of the Trust s activities in accordance with statute and regulations; and The establishment and maintenance of a system of internal control to give reasonable assurance that assets are safeguarded, waste or inefficiency avoided and reliable financial information produced, and that value for money is continuously sought. The Finance, Performance and Strategic Planning Committee shall provide the Board of Directors with a means of independent and objective review of financial and related matters. 2.1 Meetings Meetings shall be held monthly. 2.2 Documentation Formal records of the meeting (Agenda and Minutes) will be constructed using the Trust Template format documents. 2.3 Membership and Quorum The Committee shall be appointed by the Board from the Executive and Non- Executive Directors of the Trust and shall consist of; Three core non-executive Directors (although all non-executive Directors are ex-officio members and shall attend from time to time or as required) One of the Non-executive members will be appointed Chair of the Committee by the Board. Director of Finance Director of Operations Director of Nursing, Quality & Patient Experience Meetings will be open for the Chief Executive to attend should it be necessary. A quorum shall be three members, two of which should be a Non Executive Director and one of which should be an Executive Director. Ref: TOR/FPSPC/MF1202/01 Page 7 of 8
Members of the Committee should aim to attend all scheduled meetings but must attend at least 75% of all meetings each financial year. The Associate Director of Performance & Planning, Associate Director of Governance Quality and Safety, the Deputy Director of Finance and the Head of Financial Management shall normally attend meetings. 2.4 Monitoring The Committee will review the Terms of Reference on an annual basis, including the percentage attendance of members, as well as the number and frequency of meetings held. Ref: TOR/FPSPC/MF1202/01 Page 8 of 8