Annual Report and Accounts October 1 2008 to March 31 2009
Annual Report & Accounts 2008/2009 - - 1 - -
Annual Report & Accounts 2008/2009 - - 2 - -
Presented to Parliament pursuant to Schedule 7, paragraph 25 (4) of the National Health Service Act 2006
Royal Bolton Hospital NHS Foundation Trust Annual Report & Accounts October 1 2008 to March 31 2009
Annual Report & Accounts 2008/2009 - - 3 - - Contents
1 Welcome: Chairman & Chief Executive’s statement 6
2 Hospital services at the heart of Bolton About us 7 Our partners 7
3 Quality report Quality narrative 8 Our aims and strategy 11 Improving what we do 12 Review of 2008/09 14 Our priorities and plans for quality and safety in 2008/09 18
4 Improving patient care Building better services 38 Care of the highest level 39 Learning through lean 39 Awards 40
5. Patient and public involvement Informing and involving patients 41 Listening to patients 41 Complaints 42
6. Being a good citizen Looking after the environment 43 A smoke free site 43 Equality & diversity 44 Health & safety 44 Emergency preparedness 44 Research 44
7. Our staff Staff involvement 45 Education 45 Staff health and well being 46 Attendance management 46 Staff values 47
8. Business review Introduction 48 Main sources of income 48 Financial performance in 2008/09 48 Looking forward 50 Risks and uncertainties 51 Summary 52
9. Planning for the future 53
Annual Report & Accounts 2008/2009 - - 4 - -
10 Governance Code of governance 54 Membership 55 Our Council of Governors 58 Our Board of Directors 61 Audit committee 65 Nomination and remuneration committee 65 Remuneration report 66 Statement of accounting officer’s responsibilities 69 Independent auditor’s report 70 Statement on internal control 73 Freedom of information and data protection 84
11. Accounts 2008/09 Our financial performance 85 Foreword to the accounts Financial statements 2008/09 Notes to the accounts
NOTE:
On October 1 2008 Bolton Hospitals NHS Trust achieved foundation trust status. For the first six months of 2008/9 it operated as an NHS trust. All the assets and services of the former Bolton Hospitals NHS Trust were then transferred to the Royal Bolton Hospital NHS Foundation Trust.
The operating and financial requirements of foundation trusts differ from those of non- foundation trusts and separate accounts and financial statements are required for each. This document provides a report and accounts for the period October 1 2008 to March 31 2009, following authorisation as an NHS foundation trust.
A separate document covers the earlier part of the financial year.
Annual Report & Accounts 2008/2009 - - 5 - - 1. Welcome
We’re delighted to welcome you to this, our first “annual” report since we became an NHS Foundation Trust. In fact as we achieved FT status in October 2008, this report concentrates on the six months since then.
It has been both an exciting and a challenging time. We now have a membership of over 3,750 staff and around 3,700 members of the public and a very enthusiastic Council of Governors. The Governors have been helping us to formulate the way forward for the Trust on behalf of local people.
There have been many investments and developments in services and a number of individuals and teams have received national recognition for their work. These range from investment of almost £1 million in a new department for orthopaedic X-rays, to our bereavement staff being highly commended in the Nursing Times team of the year award.
The Trust’s Bolton Improving Care System continues to be highly regarded both at home and abroad for its innovative approaches to bringing benefits to patients and staff using “lean” management techniques. Just one example is that BICS has helped us improve our stroke services which audits show now offer some of the fastest and most effective care for patients in the country.
This year we have made significant improvements in our work around infection control, vital to the wellbeing of our patients. MRSA infections reduced by 48% and C difficile was reduced by 61%. We have also performed well in our target to ensure nobody waits more than 18 weeks from GP referral to hospital treatment.
There have, however, been some areas where we have not performed as well and where we recognise that we need to make improvements. For example our “turnaround” times for A and E patients to be admitted, discharged or transferred were much lower in the last six months of 08/09 than we would have liked. While much of this can be explained by a combination of an early and severe winter, respiratory illness and norovirus, we have been working hard to look at how we can consistently meet our targets.
This report gives further information on both our achievements and our challenges and also details our plans for the future. It can also be accessed online at www.royalboltonhospital.nhs.uk
Cliff Morris & David Fillingham Chairman & Chief Executive
Annual Report & Accounts 2008/2009 - - 6 - - 2. Hospital services at the heart of Bolton
About us:
The Royal Bolton Hospital NHS Foundation Trust became a foundation trust on October 1st 2008 and was founded under the National Health Service Act 2006.
Royal Bolton Hospital NHS Foundation Trust offers patients a wide range of services based at the Royal Bolton Hospital in Farnworth. The hospital:
Serves the population of Bolton (around 265,000) and many patients choose to come here from other locations. Had 33,204 emergency admissions (excluding obstetrics) in 2008/09. Delivered 4,445 babies during 2008/09 at the hospital’s Princess Anne Maternity Unit. Has 671 inpatient beds, 32 day case beds and 15 endoscopy (gastrointestinal exploration) beds. Employs around 3,660 staff. Had a turnover of approximately £93 million for the six months ended 31 March 2009 (£183 million for 2008/09.) Was given 'good' ratings by the Healthcare Commission for 2007/08 (latest ratings).
There are four operational divisions:
Medicines and Emergency Care Anaesthetics and Surgery Women's, Child Health and Outpatients Therapies, Diagnostics and Facilities
In addition, the organisation is also supported by these directorates:
Corporate Services Medical Nursing and Performance Improvement Service Development Finance, Procurement and Information Workforce and Organisational Development
Our partners
We have a wide range of partners with whom we work closely in order to provide health and other services for local people. These include NHS Bolton (Bolton Primary Care Trust), the North West Strategic Health Authority and neighbouring trusts. There are clinical networks across organisations, for instance in bringing together multi-disciplinary experts on cancer, independent contractors such as GPs and opticians, Bolton Metropolitan Borough Council, commercial organisations such as ISS Mediclean which provides our domestic and portering services, and voluntary sector organisations. We consider our staff and our patients to be partners also.
Annual Report & Accounts 2008/2009 - - 7 - - 3 Quality report 2008/2009
Narrative and view of 2008/09 – David Fillingham, Chief Executive
We have set out an ambitious vision for Royal Bolton Hospital. We aim to provide the best possible care for our patients at all times and across every service. We recognise that this aim cannot be achieved overnight. Indeed it may take us many years. But we have made a determined start and there is great enthusiasm and commitment from our staff to realise this vision. This first Quality Report is an opportunity for us to explain the work we have been doing over the last three years to improve safety and quality, to describe some of the successes we have had and to set out the challenges that remain.
Since 2005 we have been working to create what we have called BICS, the Bolton Improving Care System. We know that the challenge of delivering safe, high quality healthcare day in day out is no easy task. It requires thousands of processes, involving a myriad of contacts between patients and individual members of staff, to be well designed and consistently implemented.
BICS uses the best evidence from management and improvement science in a wide range of fields including Industry and commerce as well as best practice in healthcare. It gives frontline staff the tools to improve their work on a daily basis. Most importantly of all it engages every single member of staff and empowers them to be problem solvers. We will only have succeeded when all 3,500 staff see improvement as their daily business.
So what are the results? We have had some really encouraging early successes. Our first priority was to tackle high mortality rates within our trauma services. We had a long standing concern that patients who were admitted with fractured hips did not get the best possible care. Using our BICS approach we redesigned the patient journey, making many small improvements such as reducing the time to get patients to theatre, establishing a Trauma Stabilisation Unit and improving our discharge processes. The results were impressive: a 30% reduction in mortality with patients staying in hospital 33% less time.
Applying BICS to elective orthopaedic operations for older patients demonstrated similar success with an impressive 85% reduction in complication rates. Our stroke service was another area where our mortality rates were worryingly high. In 2006 our stroke services were rated in the bottom quarter of all trusts in the country on a range of clinical process measures known as the “Sentinel Audit”. The same audit repeated in 2008, after our BICS redesign, ranks them as the fifth best, and the mortality rates have fallen by 25%.
One of the biggest concerns of patients coming into hospital is whether of not it will be clean and hygienic and that they will remain infection free. This is another area in which we are pleased with our progress. 2008/9 saw a reduction in MRSA Bacteraemias down from 31 to only 15 together with a 61% reduction in the rates of clostridium difficile. We are continuing to extend our work to look at all other aspects of infection control.
Alongside these successes we are engaged in many other initiatives including the prevention of hospital acquired deep vein thrombosis (DVT’s), reducing the risk of sepsis, eliminating ventilator acquired pneumonias and reducing medication errors. We were also one of the original North West pilot sites for “Advancing Quality” which aims to deliver the best evidence- based care for patients across a range of clinical conditions.
Annual Report & Accounts 2008/2009 - - 8 - -
Waiting times for people referred to us for a planned appointment or procedure have continued to fall. We achieved the national standard for patients to take no longer than 18 weeks from referral to treatment. In 2008/09, 76% of all our patients were admitted for their procedure less than six weeks after being listed – the average wait was less than four weeks.
We are proud of these results and delighted that we have had some impressive early successes. However, we realise that we have only just started on a long and strenuous journey. There will be many challenges ahead.
Despite the improvements which we have made in trauma and stroke services our overall hospital mortality rates are still higher than we would wish. A major contributor to this is the mortality rates amongst patients admitted as emergencies with respiratory illness, which is a chronic condition in Bolton and the surrounding areas. This is the next major focus for our BICS improvement efforts.
We also know that during the winter months we have a challenge in admitting all those patients who require emergency treatment in a smooth and effective manner. So we are currently embarking on a radical redesign of the pathway for urgent care patients.
We recognise that we need to do more to improve patients’ experience of our services. So we are rolling out our pilot work which we have conducted using a “patient experience based design” approach in orthopaedics. We have received excellent feedback from those patients involved. We intend to roll this out further during 2009/10.
Cancellations or changes in appointment times cause disruption, inconvenience and anxiety to patients and their families. They are also wasteful of hospital resources. Some changes (for instance due to staff sickness) may not be avoided, but many could. We need to reduce the number of outpatient appointments which are rescheduled. This is a priority in our plans in the year ahead.
The level of cancellation of planned hospital admissions is at its highest when the hospital is under pressure from emergency referrals. In 2008/09 we achieved a reduction in on-the-day cancellation of admissions, and achieved the former Healthcare Commission’s threshold of this occurring in not more than 0.8% of cases. We will continue the drive to reduce cancellations.
The latest results in the National Patient Survey, disappointingly, showed no significant improvement in patients’ views of our services. Although the survey reflects some strengths, most areas were in the middle of the national range of results, and highlight the need for further action to address patients’ concerns, particularly in relation to information and communication, leaving hospital, and information about medication.
There is a risk that improvement can be seen as a series of projects rather than as part of our daily job. So, our Exemplar Ward Programme is now rolling out to cover all wards in the Trust and will be extended to non clinical departments after that. This brings together our efforts to improve safety, effectiveness and the patient experience at the level of frontline teams and gives everyone a stake in making the hospital a better place on a daily basis.
Our improvement work is most likely to succeed if it is part of a coherent system. This requires a clear sense of direction and priority to be set by the Board and Council of Governors. It
Annual Report & Accounts 2008/2009 - - 9 - - needs strong and effective leadership at every level from our managers and clinical leaders and it relies on all members of staff enthusiastically embracing our vision for “best possible care” and placing it at the centre of what they do.
At Royal Bolton Hospital we don’t see “quality” as part of our business strategy. It is the strategy! We only exist to provide a service for patients and their families. If we are not striving everyday to make that service a safer, more effective and more patient-centred one, then we are not delivering on the core purpose of the hospital. In any case, we have discovered that nine times out of ten, good quality doesn’t cost more money, it costs less. If we succeed in protecting patients from harm so they don’t have a fall, a medication error or an infection, and treat them quickly and effectively, they get better quicker, spend less time in hospital and use less of taxpayers’ resource. This is a win-win. The hospital can deliver within its budget and meet its financial commitments as a steward of tax payer’s money, whilst at the same time providing an ever-improving quality of service for its patients.
Finally I want to pay tribute to all staff at the Royal Bolton Hospital. I feel privileged to be the Chief Executive in a place where everyone is so passionately committed to providing a good experience for our patients. I speak at the induction sessions for all of our new starters and I give the message that “in Bolton we aim to treat every new patient as though they were our own relative and to strive to deliver the care that we would want for close members of our family”. Our future successes will depend on staff who genuinely believe that and are working every day to achieve it.
David Fillingham Chief Executive Royal Bolton Hospital NHS Foundation Trust
Annual Report & Accounts 2008/2009 - - 10 - - Our aims and strategy - best possible care
The Trust’s strategy is founded on four fundamental objectives:
Best possible care for our patients Improved health for our community Joy and pride in work for our staff Value for money for the taxpayer This is what we mean by BEST POSSIBLE CARE This is what we mean by IMPROVED HEALTH We will: Services which are SAFE, in which there Treat the whole person, respecting are no needless deaths emotional, psychological and spiritual needs, not just the physical Services which are EFFECTIVE, in which there is no needless pain Act in partnership with other providers of health and social care, with patients, Services which are TIMELY, in which here their families, their representatives and are no delays with the wider local community Services which are EFFICIENT, in which Work to reduce inequalities in health there is no waste status Services which are EQUITABLE, in which Play our part in improving health and the there are no inequalities outcomes of care for the local population Services which are PATIENT-CENTRED, in and the people who use our services which there are no feelings of helplessness.
This is what we mean by JOY AND PRIDE IN This is what we mean by VALUE FOR MONEY WORK
With staff, we will: Agree clear objectives and expectations Improving the quality of what we do by removing waste Invest in their training and development Learning from best practice to improve Ensure that staff receive feedback and what we do appreciation for their efforts Maintaining financial stability, to provide Value good, open and honest a sound basis for the development and communication at all levels delivery of high quality services Ensure that staff are fairly rewarded Good financial management Empower staff to effect change
These objectives provide the practical “tests” which the Trust will use to judge its strategic direction and its operational decision making. They are, first and foremost, about continually seeking to improve the safety, quality and reliability of what we do.
Annual Report & Accounts 2008/2009 - - 11 - - The services we will provide and how we will provide them
Our five strategic goals describe the Trust’s strategic direction:
1. To provide excellent and accessible emergency and urgent care What we will 2. To provide a range of leading planned diagnostic and treatment provide services 3. To provide specialist services for women and children
4. To deliver services closely integrated with primary and social care How we will provide 5. To be a leader in safety and quality at the most competitive cost services (using lean thinking through the Bolton Improving Care System – BICS )
Improving what we do – The Bolton Improving Care System (BICS)
The Bolton Improving Care system (BICS) is both the Trust’s strategy and its system for improvement. It embraces practical day-to-day methods of problem solving; redesigning services to deliver better care; involving patients in improving what we do; and involving all staff in the continuous pursuit of best possible care. It is at the heart of our plans for driving safety, quality and productivity.
The problem solving approaches in BICS use “lean” methods, borrowed from the Toyota organisation, adapted and applied to healthcare. Although, at first glance, it may seem that healthcare has little in common with the car industry, our own experience and the experience of many other organisations has demonstrated that a Toyota-like focus on improving processes, removing waste and improving quality is very relevant to tackling the biggest challenges faced by this hospital and by healthcare in general.
We have a vision that Royal Bolton Hospital Foundation Trust will be an organisation where the whole workforce is involved every day in making our processes better. The starting point of this approach is seeing “waste” and removing it from the way we work. Waste is the kind of thing staff and patients see all too often in our everyday work – wasted effort because things are in the wrong place; wasted supplies; wasted time duplicating work or doing unnecessary tasks or just waiting for things to be done; wasted effort, sometimes having to put things right that weren’t right first time; wasted talent of people who are over-burdened or distracted from what they really come to work to do – deliver good care.
We fundamentally believe that removing waste reduces defects, improves quality of care, improves the experience of patients and staff and reduces costs.
After three years of using lean methods, the Trust has seen some marked benefits (in clinical outcomes, workforce engagement, efficiency and patient experience) but we recognise that we are still early on our journey of “transformational” change.
The diagram on the following page summarises the main areas of work which are supporting our goals for higher quality, safer care.
Annual Report & Accounts 2008/2009 - - 12 - -
Clinical BICS Patient Lean Process Safety “Care Bundles” & BICS as Daily Engagement Academy Experience Redesign Advancing Quality Work Building direct Delivering Using the views Using BICS Working with Embedding Equipping front- involvement of structured of patients to methods to other standards of line teams and clinicians at learning and shape how we understand organisations, clinical practice leaders across every level in development in plan and deliver current and using in response to the Trust to work improving our improvement services processes and expertise in specific in ways which services and methods for all patient pathways improving conditions which continually seek Involving auditing the staff and to plan and patient safety, to are based on and sustain patients directly standards and implement strengthen our evidence of improvement Development in in the redesign outcomes of better ways of own systems for internationally management of services Setting and care organising what safer care – for recognised best and leadership monitoring Learning from we do, through instance, practice and best Ensuring that skills for a lean standards of day- complaints the direct through the outcomes personal and organisation to-day service involvement of national “Patient team objectives Finding ways across the Trust front-line staff Safety First” are focussed on systematically to – particularly campaign or the the Trust’s measure and within the Trust’s Health goals for track what Exemplar Ward/ Foundation’s improvement patients think Department “Safer Clinical about their care Programme Building clinical Systems” and acting on it leadership initiative capacity
Annual Report & Accounts 2008/2009 - - 13 - -
Review of 2008/09
Reporting and monitoring our performance on quality and patient safety
The Trust needs transparent reporting and tracking of key indicators of quality at every level in the organisation, to know its strengths and weaknesses and to understand whether we are improving As part of the Exemplar Ward Programme, all wards now have information boards displaying simple measures of performance against a range of key targets such as rates of infection, audit scores, and compliance with Exemplar Ward standards on the organisation and the quality of care. This is reinforced by a system of “go and see” visits by members of the Board, senior managers and matrons. At Board-level, directors have continued routinely to scrutinise performance against a range of essential measures of quality, clinical outcomes, patient and staff experience. In the first quarter of 2008, the “CLIP” report was introduced, focusing on the following: o Complaints o Litigation o Incident reporting o Patient and Advice Liaison Service – concerns and feedback from patients This provides the Board with a regular account of current issues and trends relating to the safety, reliability and patients’ experience of our services, as well as more detailed analysis of incidents or events affecting some individuals. Throughout the organisation, corporate goals for improvement in quality and safety are translated into objectives at divisional, specialty, team and individual level and progress is monitored through our performance review systems In 2008/09 we started to use the Global Trigger Tool (GTT); a system of medical notes- based audit, which identifies actual and potential incidence of harm to patients, and helps us target the most important issues on patient safety Summaries of the Trust’s record on the measures contained in Monitor’s Compliance Framework, and on the national priority indicators of performance in 2008/09 are set out in the following pages.
Annual Report & Accounts 2008/2009 - - 14 - - Monitors’ Compliance Framework Performance against key measures, April 2008 - March 2009
Target Must Achieve Achieved Performance
C difficile year on year reduction (to fit the 15% reduction 178 trajectory for the year, as agreed with PCT) max 213 cases G
Maintaining the annual number of MRSA Full target bloodstream infections at less than 50% of the 15 1 Max 16 cases 2003/04 level
Maximum time of 18 weeks for admitted 90% 90.5% patients' point of referral to treatment
Maximum time of 18 weeks for non-admitted 95% 96.6% patients' point of referral to treatment
Maximum waiting time of four hours in A&E 98% 96.7% from arrival to admission, transfer or discharge R
Maximum waiting time of 31 days from 98% 100% diagnosis to treatment of all cancers
Maximum waiting time of 62 days from urgent 95% 99.6% referral to treatment for all cancers
People suffering heart attack to receive 68% 74.2% thrombolysis within 60 minutes of call
Maximum waiting time of two weeks from urgent GP referral to first outpatient 98% 99.9% appointment for all urgent suspect cancer referrals
Standards for Better Health
On February 24th 2009, the Trust declared in year compliance with 20 of the 25 core standards (for further information see the Statement on Internal Control page 71. By the end of the reporting period the Trust was compliant with all 24 standards.
Annual Report & Accounts 2008/2009 - - 15 - - Performance against national commitments, 2008/09
Performance Existing national commitment Threshold 2008/9 where Performance indicator available April 08 to March 09 Achieved >=98% Maintain the four hr maximum wait in RBH 95.0% R
Total time in A&E from arrival to admission, Underachieved 97 -98% A&E < four transfer or discharge hrs Health Economy 96.7% Failed <97%
Rapid access Maintain a maximum two week wait Achieved >=98% 99.0% chest pain standard for Rapid Access Chest Pain Underachieved 90 -98% clinics < 14 Clinics G days from Failed <90% referral
Cancelled All patients who have operations Achieved <=0.8% 0.8% operations cancelled for non-clinical reasons to Underachieved 1.5 -0.8% be offered another binding date
within 28 days or fund the patient’s Failed >1.5% 28 day treatment at the time and hospital of 97.8% admitted admission the patient’s choice. within 28 days from a <5% breach of 28 day rule cancelled
operation Deliver a ten percentage point Achieved >=68% Oct to Dec 08 increase per year in the proportion of 76.0% Underachieved 38 -68% people suffering from a heart attack Thrombolysis who receive thrombolysis within 60 Failed <68% minutes of calling for professional help Ensure processes facilitate timely Achieved >=3.5% 0.3% Delayed discharge Transfers of Underachieved 5% – 3.5% Care Failed <5% Maintain a maximum wait of 26 Achieved <=0.03% 0.02% Inpatient weeks for inpatients Underachieved 0.15 – 0.03% waiting list Failed >0.15% Maintain a maximum wait of 13 Achieved <=0.03% 0.08% Outpatient weeks for outpatients Underachieved 0.15 – 0.03% waiting list A Failed >0.15% Record the ethnic group of patients Admitted Patients Achieved >=85% Ethnic group 81.5% recording Underachieved 60% - 85% Outpatients Failed <60% 86.8%
Annual Report & Accounts 2008/2009 - - 16 - -
Performance against National Commitments, 2008/09
Priority Indicator Threshold 2008/9 where Performance available April 08 to March 09 Completeness of MINAP >=90% (audit of management of Oct to Dec 2008 = 99.4% people with heart attacks) G data fields <= trust target Target = 16 MRSA Actual = 15
<= trust target Target = 213 C difficile Actual = 178
Completeness of hospital >2005/06 national data on smoking during average Achieving pregnancy and on initiation of breast feeding Experience of patients: Performance consistent results of 2007 survey of Survey result for 2008 A inpatients Reduce mortality rates from Participation in all heart disease, stroke and relevant audits Participation in cardiovascular related diseases by at least >=80% audit - achieved 40% in people under 75 by
2010 through participation Stroke – achieving in audits and stroke care
indicator.
Ensure nobody waits more March than 18 weeks from GP Direct Access >=95% referral to hospital Audiology treatment 100%
March >=90% Inpatient Waiting times
90.5%
>=95% March Outpatient Waiting times – 96.6% Achieved >=98% Provisional Figure All cancers two week rule Underachieved 95 -98% 99.9% Failed <95% Achieved >=98% Provisional Figure All cancers 31 day rule Underachieved 95 -98% 100% Failed <95% Achieved >=95% Provisional Figure All cancers 62 day rule Underachieved 90 -95% 99.6% Failed <90%
Annual Report & Accounts 2008/2009 - - 17 - - Our priority objectives for safety and quality in 2008/09
Our plans in 2008/09 described a number of objectives directly related to the safety and quality of our services, principally:
The reduction of the hospital’s standardised mortality ratio (HSMR), aiming for an HSMR of 100 or less
The reduction of MRSA infections to no more than 15, and the incidence of C. difficile infections to 213 or less
The achievement of at least 98% on the four hour A&E target
Improvement in the standards of care for stroke patients, as measured by the stroke Sentinel Audit of best practice
We also planned to make improvement in the following areas:
Improving our systems for monitoring and responding to patients’ experience of our services
Establishing good systems for measuring and reducing harm or potential harm to patients
Building improvement capability in the Trust
Extending the use of, and compliance with, “care bundles” (consistent use of standard interventions for specific clinical conditions)
Our performance against these objectives is set out in the following pages.
Note: Mortality figures in this document referring to 2008/09 use the previous version of the Dr Foster risk-weighted analysis. For reports relating to April onwards the Trust will use recently introduced version of Dr Foster (RTM 8.0) and comparisons between years will be annotated to indicate the change in methodology so that comparisons may be interpreted appropriately.
Annual Report & Accounts 2008/2009 - - 18 - - Performance against our priority objectives for safety and quality
PRIORITY 1: Reducing the Hospital’s 30-day Standardised Mortality Rate (HSMR)
Description of the issue and why it is a priority
The Trust has seen a steady decline in its standardised mortality rate (HSMR) as a result of concentrated effort over the last two years to address its highest risk systems and processes. In orthopaedic trauma, the rate reduced from amongst the worst nationally, to being 15% better than the national average (risk-weighted for casemix), following continuing work by front-line teams using the BICS methodology, to improve the whole pathway for these patients. The overall risk-weighted HSMR for 2007/08 was 117.5. (17.5 % higher than the expected rate for the age/gender profile of Bolton’s population)
Aim/Goal
The Trust aimed to have a HSMR of less than 100 by the end of 2008/09.
Current Status
HSMR - Trust Total April 2005 to December 2008
140.0 (Risk-weighted) 130.0 120.0 110.0 100.0 90.0 80.0 70.0 60.0 50.0 Apr- Jul- Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jul- Oct- Jun 05 Sep Dec Mar Jun 06 Sep Dec Mar Jun 07 Sep Dec Mar Jun 08 Sep Dec 05 05 06 06 06 07 07 07 08 08 08
HSMR - Trust Total National Average Average UCL LCL Linear (HSMR - Trust Total)
Crude (non risk-weighted) mortality rates – trend
Hospital deaths each month as a percentage of inpatient discharges
6.0
5.0
4.0
3.0
2.0
1.0
Jun Oct Jun Oct Jun Oct Apr Jun Oct Apr Aug Dec Feb Aug Dec Feb Aug Dec Feb Aug Dec Feb June Feb Apr-04 Apr-05 Apr-06 AugustOctober December
% of deaths mean UCL LCL Linear (% of deaths)
Annual Report & Accounts 2008/2009 - - 19 - - The Trust achieved a reduction in overall risk-weighted rates to 102.2 by December 2008, and a full year rate of 109. In stroke, the rate has fallen to below 100 and improvements in the pathway for orthopaedic trauma continue to achieve an HSMR below the national expected rate for our mix of patients:
Death rates attributed to pneumonia and other respiratory conditions remain above expected rates and are the priority for our work in 2009/10.
Stroke 2005 -2009 Hip fracture 2005 - 2009
Initiatives in 2008/09
We continued to redesign “high risk” clinical pathways o Cardiology o Respiratory o Stroke o Trauma As a pilot site for “Advancing Quality”, we made progress in standardising processes to achieve compliance with best practice “care bundles” in pathways for o Myocardial infarction o Heart failure o Joints surgery o Community acquired pneumonia
We continued to promote the use of early warning scores (triggers related to patient’s vital signs), supported by rapid response systems, for patients whose condition is deteriorating
Board Sponsor: Jackie Bene, Medical Director
Annual Report & Accounts 2008/2009 - - 20 - -
PRIORITY 2: Reducing healthcare acquired infections (HCAI)
Description of the issue and why it is a priority
In 2007/08 rates of MRSA infection exceeded target, with 31 cases in the year and C difficile rates were too high at 294 cases. This Trust, in common with others across the country, needed to improve on this essential aspect of safe care, and a target of 50% reduction was set nationally.
Aim/Goal 2008/09
Our ultimate goal is to eliminate all avoidable hospital acquired infection. In 2008/09 our target was to achieve no more that 16 MRSA bacteraemia cases and no more than 213 C. difficile cases throughout the year. We also aimed to maintain compliance with the Healthcare Commission Hygiene Code.
Current Status
Cumulative Number of C Diff Cases 2007/8 and 2008/9
350 300 250 200 150 100 50 0
April May June July March August October January November February September December
2007/8 2008/9
Cumulative Number of MRSA Cases 2007/8 and 2008/9
35
30
25
20
15
10
5
0
April May June July March August October January November February September December
2007/8 2008/9
Annual Report & Accounts 2008/2009 - - 21 - - The Trust achieved a marked improvement in HCAI rates in 2008/09. There was a total of 15 MRSA infections. Eight cases were post-24 hours (hospital acquired) and seven were pre-48 hours (acquired before admission to hospital). C. Difficile cases fell to 178 for the full year, from 294 in the year before.
The Trust was awarded unconditional registration with the Care Quality Commission in respect of the Hygiene Code, effective from 1st April 2009.
Initiatives in 2008/09
We strengthened aseptic/non touch techniques throughout the Trust We extended MRSA screening towards coverage of all elective patients - this was achieved by the end of March 2008 Audit of antibiotic policies compliance was embedded, and continued training given to support best practice across the Trust We established visible monitoring of key performance indicators in all areas All cases were subject to detailed root cause analysis, and learning from each case was shared We worked with other healthcare providers to improve systems of prevention in the community We reinforced observations of best practice through regular “go and see” rounds by matrons and senior managers
Board Sponsor: Lesley Doherty, Director of Nursing and Performance Improvement
Annual Report & Accounts 2008/2009 - - 22 - - PRIORITY 3: Improving access for emergency patients – achievement of the four hour A&E target
Description of the issue and why it is a priority We recognise that improvement in urgent care pathways and, through that, achievement of the four hour target, is essential to improving the quality and safety of care in the hospital. In the last three years, the Trust and the Bolton healthcare system as a whole has failed to achieve the 98% A&E standard for admission, discharge or transfer in four hours. In 2007/08 we achieved 96.3%.
A major joint planning exercise with the PCT and Local Authority in 2007 resulted in a shared vision for a new model of urgent care across Bolton, and plans are in hand to implement the changes required. These include the establishment in August 2011 of a town centre urgent care facility, which is expected to provide services integrated with pathways which also include the hospital’s urgent care service.
Aim/Goal 2008/09
In 2008/09 our goal was to achieve 98% admission, discharge or transfer from A & E within four hours.
Current Status
Patients seen and discharged within 4 hours of arrival in A&E - April 2008 to March 2009
100.0%
95.0%
90.0%
85.0%
80.0%
75.0%
70.0%
Apr-05 Jun-05Aug-05 Oct-05 Dec-05 Feb-06 Apr-06 Jun-06Aug-06 Oct-06 Dec-06 Feb-07 Apr-07 Jun-07Aug-07 Oct-07 Dec-07 Feb-08 Apr-08 Jun-08Aug-08 Oct-08 Dec-08 Feb-09
% Seen Within 4 hours Target
In 2008/09 the Trust saw a continued rise in levels of urgent care demand. There was a 1.7% increase in emergency admissions and a 4.4% increase in A&E attendances. The Trust’s performance on the A&E four hour target was 95%; the standard achieved for the whole healthcare system in Bolton was 96.7%.
Annual Report & Accounts 2008/2009 - - 23 - - Until November 2008 the Trust was on track to achieve the 98% standard but a prolonged outbreak of Norovirus, and earlier exacerbation of respiratory illness linked to the colder weather in December, resulted in increased admissions and increased length of stay for elderly patients with co-morbidities, along with a general increase in non-elective attendances. A compounding factor was the number of patients medically stable and fit for discharge from an acute bed not able to access community step-down facilities. The PCT has recognised this as a high priority for the heath economy and joint plans have been put in place to improve the situation. The Trust also engaged an external review of A&E processes and towards the end of March implemented major changes arising from the review.
Initiatives in 2008/09
Improved access to out-of-hours diagnostics We continued to redesign the acute stroke pathway – with early assessment and access to a specialist acute stroke unit We increased medical staffing to improve immediate assessment of patients presenting at A&E We extended seven-day working for key services, in order to improve discharge processes at week-ends We continued work with partners in primary and community services to improve discharge and to prevent unnecessary admissions Additional capacity was introduced over the winter months.
Board Sponsor: Lesley Doherty, Director of Nursing and Performance Improvement
Annual Report & Accounts 2008/2009 - - 24 - - PRIORITY 4: Improving standards of care for stroke patients
Description of the issue and why it is a priority
The Bolton population has a high incidence of cerebrovascular disease (strokes) and mortality rates from stroke are high, at 136 (36% higher than the expected rate for the age/gender profile of Bolton’s population). Approximately 400 patients a year are admitted with a stroke. In 2006/07 the HSMR for stroke was 120.5. The National Strategy for Stroke highlights the potential for improvement in the outcomes for stroke patients to be gained from well- organised evidence-based practice.
The Royal College of Physicians’ annual Sentinel Audit measures compliance with best practice in hospitals providing stroke care across the country. Services are scored out of 100. In 2007/08 the Trust’s score was 67%. The Trust prioritised the improvement of care pathways for stroke patients, particularly in the early acute phase of a stroke, and from 2007 front-line teams in Stroke services were supported, through BICS, to plan and implement changes.
Aim/Goal
The Trust aimed to achieve a reduction to 100 in the HSMR for stroke, and to achieve at least 90% in the Sentinel Audit.
Current Status
HSMR - Stroke
200 180 160 140 120 100 80 60 40 20 0
Jul-05 Jul-06 Jul-07 Jul-08 Jan-05 Apr-05 Oct-05 Jan-06 Apr-06 Oct-06 Jan-07 Apr-07 Oct-07 Jan-08 Apr-08 Oct-08 Jan-09
HSMR Average UCL LCL Linear (HSMR)
The Trust achieved a reduction in HSMR from stroke from 117.4 in 2007/08 to 99.1 in the year to November 2008 and its score in the Sentinel Audit moved from 67% to 92% - the fifth best, nationally.
Annual Report & Accounts 2008/2009 - - 25 - -
Sentinel Audit Scores 2008/09 Number of cases in the audit 58 Screening for swallowing disorders < 24 hours after 86% admission Brain scan within 24 hours of stroke 97% Physiotherapist assessment within 72 hours of 98% admission OT assessment within 4 working days of admission 98% Patient weighed during admission 100% Patient’s mood assessed by discharge 96% Rehabilitation goal agreed by the MDT 100% Aspirin or clopidogrel by 48 hours after stroke 100% Patients spent at least 90% of stay on a stroke unit 53% % of eligible patients receiving all 9 indicators 47% Average of key 9 indicators 92% Overall position 2008 Upper quartile Overall position 2006 Middle half
Initiatives in 2008/09
Introduction of an acute stroke admission and monitoring area on Ward A4 Further improvements in access to CT scanning Daily “board round” review of patients Visible daily tracking against key indicators of best practice Improvements in the management of the admission of patients to the acute Stroke Unit from A&E
Board Sponsor: Ann Schenk, Director of Service Development
Annual Report & Accounts 2008/2009 - - 26 - - Progress against other plans for the improvement of quality and safety in 2008/09
Improving our systems for monitoring and responding to patients’ views of their experience
The BICS approach recognises that improvement has to be founded on a view of our processes “through the patient’s eyes”. Involvement of patients in BICS Teams and deliberate efforts to seek patients’ views are built into the way that BICS works. In 2008/09 we started to use a method called patient experience-based design. In the orthopaedic elective pathway a range of patients agreed to keep a record of their experiences and feelings throughout their “journey” and a number also gave a video account of their experiences. The results were shared with staff, and staff and patients together have designed and implemented changes based on the dialogue. We plan to extend this method to other groups of patients in 2009/10. We continue to use the results of the National Patient Survey to focus on areas which patients indicate lower levels of satisfaction – information and communication; leaving hospital and medication advice were rated relatively poorly by patients in 2008.
Establishing good systems for measuring and reducing harm or potential harm
In 2008/09 we began to introduce the Global Trigger Tool (GTT). This is an internationally-recognised method of audit of patients’ notes in order to systematically identify sources of harm. A number of staff have now been trained in the method and monthly audits are undertaken routinely. The initial results are being compiled and will provide the basis for planning and implementing improvement in our clinical systems, and for tracking our progress. Initial audit has already prompted a more detailed review of reasons for re-admission, which will be the basis for further work in the year ahead. Across healthcare, adverse medication events are recognised as a serious source of harm. Within the Trust we have improved our reporting systems to establish a better measure of serious medication events, while seeking to raise the overall level of incident reporting so that the organisation is aware of and can act on trends in actual or potential safety issues.
Building improvement capability in the Trust
BICS skills Our aim is to equip all staff with the knowledge, motivation and opportunity to improve care for patients. In 2008/09 we introduced a structured learning and development programme – the BICS Academy – which aims to spread knowledge and awareness of the Trust’s aims and values, and the fundamentals of BICS, to all staff.
In 2008/09, 960 people attended the most basic, “Green”, level learning sessions. We also saw the first group of 30 staff enter the, higher, “Bronze” and “Silver” level training.
Annual Report & Accounts 2008/2009 - - 27 - - As many staff as possible are also offered the opportunity to participate in hands-on improvement work through being members of improvement teams. In 2008/09, 529 people participated in teams. In all, approximately 28% of the workforce have now participated and contributed directly to delivering the benefits.
Exemplar wards
The Exemplar Ward Programme is based on the achievement and sustainment of an agreed set of standards for patient care and for the organisation of our wards.
Originally piloted on three wards in 2007, in 2008/09 more wards entered the programme, aiming for all wards to be participating by December 2009. All areas are expected to achieve a minimum of 80% compliance. Progress is reported and tracked using information boards on every ward and reinforced through matron, director of nursing and director level “go and see” visits. The Exemplar Ward Programme embodies the BICS approach to day-to-day working for improvement.
Safer Clinical Systems
In 2008 the Trust, together with Bolton PCT, was selected with three other sites nationally to be participants in the Health Foundation’s Safer Clinical Systems Initiative. The initial focus of our joint work is to reduce harm in the urgent care pathway, resulting from poor communication between primary and secondary care. In the next phases, our learning, and that of the other three sites, will provide the basis for wider improvement in the NHS, sponsored by the Health Foundation.
Patient Safety First
o The Trust has signed up to the nationwide Patient Safety First campaign and has elected to concentrate on two main areas initially, using the guidance provided by this initiative: o Clinical Leadership Development o Improving Safety in Theatres Through the Use of Pre-operative Checklists
Annual Report & Accounts 2008/2009 - - 28 - - Raising levels of compliance with, best practice * “care bundles”
Advancing Quality
Advancing Quality is a North West Strategic Health Authority (SHA) initiative introduced to support a uniform approach to evidence based interventions for five conditions:
o heart failure o coronary artery by-pass graft o hip and knee surgery o myocardial infarction (heart attack) o community acquired pneumonia
It will also provide us with a comparison of our standards with other acute hospital services.
There are financial incentives for improving practice and achieving high compliance. Any financial reward is expected to be reinvested in the clinical service itself.
Data collection and monitoring is now in place with an infrastructure to support sustainment. The first comparative results will not be available until October.
Sponsor: Director of Nursing and Performance Improvement
[Note: * “Care bundles” are groups of actions or interventions which are shown to be the most effective way to assess and treat patients who have specific conditions]
Annual Report & Accounts 2008/2009 - - 29 - - Response to Regulators
The Trust recently made its declaration to the Care Quality Commission and, although we declared non-compliant in year with four standards, we were able to declare compliance by year end. The areas of non compliance were in relation to C9 (data control and security) relating to a temporary loss of patient identifiable data during transportation of confidential waste.
An inspection by the Health Care Commission in March 2009 highlighted significant progress with issues raised at an earlier visit but found concerns regarding decontamination of equipment which affected C4a, C4c and C21. An action plan was implemented immediately and the Trust was fully compliant with all elements of the Code by the year end. The Trust has been given unconditional registration with the Care Quality Commission on the Hygiene Code.
The Trust received two mortality alerts from Dr Foster in 2008 with regard to mortality from cerbrovascular disease (stroke) and chronic obstructive pulmonary disease and bronchiectasis (COPD).
In respect of stroke, this was a high priority for 2008/09 (see priority 4) which details the effective actions undertaken to reduce mortality rates from strokes.
In respect of COPD, the Trust is currently investigating the cases involved. Reducing the Trust’s overall HSMR and HSMR for respiratory pathways has been identified as a priority for 2009/10.
Response to LINks (Local Involvement Networks) and feedback from members and governors
Bolton LINk
The Trust has worked closely with the Bolton LINk during its developmental phase and has established a close working relationship. We are keen to ensure that as the LINk and the Governors develop, effective mechanisms will be in place to work together, understand each others roles and avoid duplication. The Trust and Bolton LINk have discussed the possibility of a LINk-appointed Governor and this will be discussed with members and Governors at the Annual Members’ meeting in September.
Members and governors
In our first six months as a Foundation Trust, the Governors have established good working relationships with their Local Area Forums. The Governors attend the drop in session prior to the quarterly area forum to be available should any Foundation Trust member or member of the public wish to raise any issues relating to the Trust. The Governors’ presence at these forums is publicised in the Foundation Trust newsletter and in the invitation letter sent by the Council to invite local residents to the Forum.
Governors report back on issues raised at the Local Area Forum and discuss these at the Patient, Staff and Visitor Experience Sub Group and at the main Council of Governors meeting.
Annual Report & Accounts 2008/2009 - - 30 - -
Our priorities and plans for quality and patient safety in 2009/10
SAFETY
PRIORITY: Further reduce hospital acquired infections OBJECTIVE: Reduce the number of hospital acquired MRSA bacteraemias to no more than eight and to have no more than 15 in total in the year (including patients acquiring infection before hospital admission) Reduce C. Difficile infection to no more than 188 cases in 2009/10 Reduce the incidence of all hospital bacteraemias by 15% WHAT WE Performance against our target for the incidence of MRSA and C WILL difficile in hospital MEASURE: Performance on the level of contaminated specimens WHAT WE WILL DO: Continue in-depth root cause analysis on all MRSA bacteraemias and C difficile infections, involving personal reporting on all MRSAs to the executive team, and investigation by the Medical Director of all C. Diff cases Regularly audit and report on antibiotic prescribing practice in each clinical area Extend “go and see” visits by Directors (including Non-Executive Directors), Matrons and Director of Nursing Audit and take action on patterns of surgical site infection Work with partners in community services to reduce the incidence of infection acquired pre-hospital Ensure that all elective admissions are screened for MRSA and develop plans for extension of screening coverage of non-elective admission Audit compliance with *VIP/isolation policies (* ventilator induced pneumonias) Roll out blood culture competency training for staff, aimed at reducing the number of contaminated blood tests Carry out a regular programme of environmental audits Review screening criteria for patients with complex needs i.e. wounds/long admissions Review the care and management of patients with challenging behaviour
Annual Report & Accounts 2008/2009 - - 31 - -
PRIORITY: Improve how we identify sources of harm or potential harm to patients OBJECTIVE: Establish routine use of the Global Trigger Tool (GTT) to identify and track causes of harm Establish a baseline measure of harm resulting from medications WHAT WE WILL Major causes of harm identified through GTT reviews MEASURE: Medication errors resulting in harm WHAT WE WILL DO:
Evaluate the introductory period of using the GTT Train more staff in the use of GTT Use the information arising from GTT analysis to indicate priorities for further action on patient safety Establish audits to track whether we are improving the use of thromboprophylaxis to avoid hospital-acquired harm which can result from venous thromboembolism
5.2 EFFECTIVENESS
PRIORITY: Reduce the hospital’s standardised mortality rate (HSMR)
OBJECTIVE: Reduce the hospital’s standardised mortality overall from 109 to less than 100 Reduce or maintain at 100 or less the HSMR for stroke; pneumonia; trauma, and congestive heart failure (CHF) WHAT WE WILL Whole hospital HSMR MEASURE: HSMRs for stroke; trauma; pneumonia; congestive heart failure WHAT WE WILL DO:
At Board level and throughout the Trust report HSMR on the highest risk clinical groups in addition to the overall HSMR, these being stroke community acquired pneumonia congestive heart failure hip fracture From June, report on other death rates of public interest which will be obtained from local data, these being deaths from MRSA and c. difficile infection deaths following readmission within 30 days deaths from hospital acquired pneumonia deaths following falls in hospital
Annual Report & Accounts 2008/2009 - - 32 - -
From April, systematically investigate all unexpected deaths, whether or not referred to HM Coroner, and share any learning amongst clinical teams. Have a major focus on quality and safety and continue to use BICS methodology in order to redesign our high risk pathways of clinical care: cardiology respiratory acute medical and surgical care Continue to roll-out the “early warning scores” and rapid response systems using the “ibleep” electronic alert system Continue to work with primary care and community care providers to avoid unnecessary hospital admission at the end of life Strengthen critical care capacity through increased access to non-invasive ventilation in general wards, extended outreach, integrated intensive care unit and high dependency unit working, and improved step-down from critical care.
PRIORITY: Reduce avoidable re-admissions within 28 days
OBJECTIVE: To reduce the % of re-admissions within 28 days for adults from 9.1% (the target reduction to be confirmed in the light of further analysis using the Global Trigger Tool) WHAT WE WILL Readmission within 28 days as a % of all adult discharges MEASURE: WHAT WE WILL DO:
Examine in detail the reasons for re-admissions using the Global Trigger Tool, and, with partners in primary and community care, introduce improvements to address avoidable causes Incorporate agreed changes into the standard work for the care and discharge of patients admitted as emergencies Implement improvements in the timeliness and completeness of communication between primary and secondary care as part of the Safer Clinical Systems initiative
Annual Report & Accounts 2008/2009 - - 33 - -
PRIORITY: Improve levels of compliance with evidence-based best practice OBJECTIVE: Raise levels of compliance with (National Institute for Clinical Excellence) NICE guidelines from 81% to at least 90% Achieve levels of compliance with Advancing Quality *care bundles to at least as good as the top 25% in the USA [Note: *“Care bundles” are groups of actions or interventions which are shown to be the most effective way to assess and treat patients who have specific conditions] WHAT WE WILL % compliance with NICE guidelines MEASURE: % compliance with the Advancing Quality care bundles for joint replacement (hips and knees) community acquired pneumonia heart attack heart failure WHAT WE WILL DO: Embed evidence-based practice in improvement of urgent care pathways Introduce a five-year programme of audit of NICE guidelines in every clinical area Promote best practice and monitor compliance with the sepsis care pathway
5.3 PATIENT EXPERIENCE
PRIORITY: Improve the management of care for patients admitted as emergencies OBJECTIVE: Achieve at least 98% of patients admitted, discharged or transferred from A&E in 4 hours Achieve bed occupancy of 85% by December 2009
WHAT WE WILL A&E 4-hour target MEASURE: hospital performance Bolton-wide performance % bed occupancy Trends in length of stay WHAT WE WILL DO: Implement an intensive programme of redesign of high volume, urgent care, admission pathways; directing 80% of the in-house improvement resource to supporting implementation; focussing on using a “tollgate” approach to managing patient flows; aiming for early specialist assessment, reduced length of stay and improved discharge management Increase the senior medical workforce, to enable early specialist triage and assessment with straight-to-specialty admission where appropriate: two additional acute physicians one cardiologist one A&E consultant one general surgeon
Annual Report & Accounts 2008/2009 - - 34 - - Continue to extend the routine availability of support services to enable better weekend cover Implement new processes for the electronic generation and transmission of discharge correspondence Audit the reasons for re-admission and work jointly with primary and community services to address these Work with the PCT to secure joint clinical ownership of health community-wide clinical pathways for urgent care, taking account of the emerging role of the town centre diagnostic and treatment centre, to open in August 2011 Develop an end of life care strategy for the Trust Implement plans for the integration of critical care services and extended access to high dependency care outside critical care areas Agree plans with Bolton PCT and the North West Ambulance Service to reduce the average turnaround time for ambulances (approximately 33 minutes), to deliver 15 minutes’ average during 2009/10
PRIORITY: Sustain improvement in the rate of hospital cancellations of admission, and reduce cancellation and rescheduling of outpatient appointments and “did not attend” (DNA) rates OBJECTIVE: Achieve a cancellation of admission rate of no more than 0.8% (and aim for further reduction) Reduce the proportion of outpatient appointments cancelled by the Trust and rescheduled, from 4.1% to no more than 3% (provisional – further analysis to be completed) Reduce our new outpatient DNA rate from 9% to less than 8% WHAT WE WILL % inpatient/day case cancellations by the hospital MEASURE: % total outpatient appointments cancelled and rescheduled by the Hospital first outpatient DNA rates WHAT WE WILL DO:
Continue to introduce improvements in theatre scheduling Improve urgent care pathways, and reduce levels of bed occupancy Improve outpatient planning and scheduling Ensure more patients are involved in discussing and agreeing the date of their outpatient appointment
Annual Report & Accounts 2008/2009 - - 35 - -
PRIORITY: Improve patients’ experience in relation to i) Information and involvement in discharge planning ii) Staff communication with patients iii) Explanation of medications OBJECTIVE: Improve patients’ rating of the Trust on these aspects of their care in the National Patient Survey, for 2008/09 by 15% or more WHAT WE WILL Performance against identified measures from the Patient Survey MEASURE: WHAT WE WILL DO:
Improve the involvement of patients in their discharge planning through better hand-over processes in urgent care pathways. This will also involve ward-based pharmacists in discharge planning with patients and carers. Extend the EXEMPLAR WARD PROGRAMME across the Hospital Improve medicines information provided in A&E
PRIORITY: Improve segregation of patients of different genders in our wards OBJECTIVE: Achieve at least a 50% improvement in levels of segregation by June 2009 WHAT WE WILL Performance against the Trust plan to reorganise ward MEASURE: accommodation to achieve target levels of improvement Performance against the measure on mixed sex accommodation from the National Patient Survey WHAT WE WILL DO:
Introduce nine further single sex wards by July 1st 2009, making a total of 14 out of 24 wards (all other wards having segregated accommodation within the ward area in line with the national requirements on protection of privacy and dignity Using earmarked funding to improve single gender toilet and bathroom facilities in specialist wards which retain some mixed sex accommodation By the end of May, redesignate the Trust’s medical assessment wards to segregate males and females Enable provision of a single gender bay in the high dependency unit From June, re-organise the mixed sex assessment ward for urgent surgical referrals (F3), to establish single sex assessment bays
Annual Report & Accounts 2008/2009 - - 36 - - Building Our Skills, and Supporting Quality and Safety Improvement in the Trust in 2009/10
Safer Clinical Systems (SCS)
As part of the Health Foundation’s Safer Clinical Systems programme we will, together with Bolton PCT, identify the changes needed to improve patient safety related to communication between primary and secondary care clinicians; undertake more detailed review of the reasons for readmission and introduce improvements where these are indicated; start work on the system-wide changes which will guard against harm from pressure sores and medication errors. In June we will host a learning event for the three other sites nationally (Hereford, Lothian and Plymouth), the Health Foundation and the support team from Warwick University and Imperial College.
Patient experience-based design
The involvement of patients and staff together in making improvements in the way we provide care, based on patients’ own experiences will be extended to:
child and adolescent mental health services stroke care respiratory urgent care services
The Trust will also pilot “vital care” cards which engage patients at the start of their episode of care in identifying how they wish care to be delivered.
Quality accounts
The measures of progress described in this report in relation to our priorities for 2009/10, will be reported and reviewed regularly at Board level and throughout the Trust, as the newly- introduced “Quality Account”.
Patient Safety First – surgical checklists
Within the National Patient Safety First campaign, the Trust will introduce best practice checklists, aimed at assuring highest levels of safety for patients undergoing surgical operations.
BICS
More front-line staff will be involved directly in improvement teams, particularly ward-based staff, and those in relevant clinical support services, in the high volume urgent care pathways – respiratory, complex care, stroke, cardiology and surgery.
The BICS Academy will aim to deliver “Green” level training to 800 more people, a further forty five people will enter “Bronze” level training, and fifteen more “Silver” level.
Annual Report & Accounts 2008/2009 - - 37 - - 4: Improving patient care: highlights of our year
Building better services
Orthopaedic outpatients
A new orthopaedic X-ray suite was officially opened in March reducing waiting times and bringing many other benefits for patients.
The suite cost £900,000, including two new digital X-ray machines which cost around £300k. It is being used for outpatients who have suspected fractures or who may be having hip or knee replacements. Currently around 30,000 orthopaedic outpatient X-rays a year are taken. Previously this could have taken around 45 minutes but now, thanks to the new system which also includes high tech digital imaging, it take as little as ten minutes.
Additional benefits of this new development are a new treatment room for orthopaedic patients and a large new office for orthopaedic medical secretaries.
Cancer services
We unveiled a new £90,000 extension to our Churchill Oncology Unit in March. The Churchill Unit first opened in 2004 and offers numerous clinics for cancer patients every week, including chemotherapy and blood tests.
The new ‘quiet room’ provides patients with a dedicated area where they can go if they receive bad news or want to wait in privacy for chemotherapy or blood results. It is a light and airy space that has been designed with a relaxing feel for patients during what can be a particularly stressful time.
Maternity services
A new midwife-led Birth Suite opened in July and has now welcomed more than 200 babies. The unit provides women with uncomplicated pregnancies the option of having their babies in a comfortable home-like environment. However back-up facilities are available if needed.
The Birth Suite is in a formerly unused ward in the Princess Anne Maternity Unit and includes a birthing pool, five separate en suite bedrooms, a lounge, relaxation area and place to make refreshments. The unit can also support family centred care and birth partners are able to stay in the birth suite if they wish.
In March we also gave the go-ahead for a £20 million investment in our services for women, children and babies which we anticipate will be funded by a long term loan from government sources. Under the Making it Better scheme the Royal Bolton Hospital will become a ‘super centre’ for this type of care and over the next three years we will be expanding our facilities through a major building programme and staff investment. The building work is due for completion towards the end of 2011.
Annual Report & Accounts 2008/2009 - - 38 - - Care of the highest level
This year we were highlighted as one of the top five hospitals in the country for caring for patients who have had a stroke. Our stroke service is now used as a model for people from other hospitals both locally, nationally and internationally to show how improvements can be made using lean methodology.
We have established a clinical assessment and treatment service (CATS) for ophthalmology and referral to treatment time for cataract surgery is now at eight weeks. In January 2009, our Eye Unit achieved the Excellence in Practice accreditation awarded by University of Teesside. Conversion of two further theatres to laminar flow was completed allowing more flexibility and capacity for undertaking orthopaedic and vascular surgical procedures. Laminar flow ventilation is used in modern operating theatres to reduce the number of infective organisms which can sometimes cause post-operative complications. We also completed the first round of bowel screening ahead of schedule – a vital programme which can help diagnose cancer earlier. More than 1000 have had colonoscopies and to date 87 cancers have been detected. 395 individuals with polyps have also been placed on a surveillance programme to spot cancers before they develop. Bolton was also selected as one of only four sites nationally, to participate in the Health Foundation’s ‘Safer Clinical Systems’ initiative, targeting the improvement and reliability of urgent care pathways. In December 2008 the Trust moved its major patient administrative and clinical IT systems to the National Reference Solution (LE2 .2) within the National Programme for IT – “Connecting for Health”. The project was intensive and far reaching. It involved: The transfer of 14.5 million records from the former Patient Administration System to the new one The training of 1700 staff Establishing 11 major technical interfaces to existing systems 1200 staff checked and issued with smartcards which control their authorised level of access to the new system Creating a new data warehouse for the Trust to support improved reporting 450 new PCs and printers installed.
The new system provides a platform in 2009/10 to introduce electronic ordering and reporting of tests across the hospital and the extension of electronic clinical correspondence.
Learning through “lean” The Royal Bolton Hospital is a leader in using "lean thinking" in health care. This is a way of improving patient services and adding value for patients and staff through the removal of wasteful activity . We have developed our own Bolton Improving Care System (BICS) using lean thinking.
For more than three years, teams from across the Trust have been learning how to use BICS to tackle problems and improve the way we do things, so that we can deliver a better service for patients, better working lives for staff and better value for money.
Annual Report & Accounts 2008/2009 - - 39 - - This year a structured learning and development framework for BICS, the “BICS Academy”, was introduced, and saw its first intake of 25 people progressing to “Silver” level certification. Over 1000 people in the Trust attended “green” level (basic lean awareness) sessions. In the corporate programme of BICS work the focus has been on orthopaedics, theatres, urgent care, and on supporting outpatient redesign and cost reduction.
Major benefits for patients this year include the continuation of the work improving care for patients in stroke, older people, trauma and ophthalmology. New improvement work started in key areas of theatres, respiratory, and outpatients.
Awards: high praise for our team
During our first period as a foundation trust, the excellence of our staff has been recognised nationally with a number of high profile accolades and achievements.
Consultant physician Dr Simon Stacey won an award from the NHS North West Leadership Academy in November, in the category ‘Service Improvement through Leadership’. He was nominated for leading improvements for orthopaedic and other surgical patients. Working with colleagues, he has enabled the creation of a Trauma Stabilisation Unit which gives additional support to high risk patients. He has also led work to improve the health of appropriate patients before surgery, greatly reducing the likelihood of post-operative complications. He has worked with the team which is incorporating patients’ views directly into improvements in care.
Our Chief Executive David Fillingham was also named by the Health Service Journal (HSJ) as one of the 50 people with the greatest influence on NHS management policy and practice in 2008. His award winning work in ‘lean’ management, originally created by Toyota to streamline the production line for its vehicles and improve quality and cost effectiveness, has been highly influential in the health service.
Our Bereavement and Donor Team was also highlighted as an example to the rest of the NHS in the Nursing Times Awards for Team of the Year. The team has consistently been at the forefront of this type of work and much that they have pioneered in Bolton has been taken up nationally. Working with staff and members of the public they have raised awareness about organ and tissue donation, giving support to families at what is often a very difficult time.
Andy Minett, Specialist Biomedical Scientist, came second out of 21 in TrusTECH’s North West NHS Innovation Awards in the category for Software/Systems. He wrote Laboratory MonSTA (Monitor Short Turn Around) to help staff track specimens and speed up the process of routine tests.
A project from our Eye Unit and link workers, which aims to raise awareness of glaucoma amongst the Asian population, was also selected as a finalist in the Allergen Glaucoma Awards. The project was the development of a leaflet for the Asian community about glaucoma - the first of its type in the country. It has proved so successful that other hospitals across the country are now replicating it.
Annual Report & Accounts 2008/2009 - - 40 - - 5: Patient and public involvement
Informing and involving
We are committed to informing and involving patients, carers, staff and the public on every aspect of our service. Our patient and public involvement work ensures that their voices are heard at every level and that we use their feedback to build a patient-focused service.
As part of our patients and public involvement work we:
Provide an extensive range of information to patients. Our patient information leaflets are assessed by a group of volunteer readers including patient representatives, to make sure it is easy to understand before it is printed.
Recruit, inform and engage with our Foundation Trust members. Members are a vital voice in providing feedback about services.
Have a Council of Governors representing our public members. Quarterly council of governor meetings are held in public.
Keep interested members of the public well informed of developments and news through our website, the media and other communications channels, including a newsletter for members.
Have a Patient Experience Group which meets monthly. The group has representatives from both staff and patients and was set up to share views and to discuss how improvements can be made.
Listening to patients: Using patient feedback to improve
The views of our patients are vital in developing our services and help us know whether we are getting things right. We have a number of ways in which we obtain these views including taking part in national patient surveys. We monitor and respond to patient feedback on websites including NHS Choices. We also run a highly active comment card service, issued to patients when they are discharged. As a direct result of comments, many improvements have been made this year including the installation of handrails in our corridors and extra wheelchair supplies in Accident and Emergency.
We also have an active Patient Advice and Liaison Service (PALS), ideally located in the main entrance of the hospital. People can contact PALS for information about services and advice about problems and PALS staff will do all they can to resolve issues as quickly as possible. From October until the end of March 2009, PALS received 577 enquiries.
Annual Report & Accounts 2008/2009 - - 41 - - Complaints
Complaints management is undertaken in accordance with the NHS (Complaints) Amendment Regulations 2006. Complaints are regarded as an important opportunity to improve practice by identifying and sharing key learning points. The Customer Relations Department works closely with the divisional teams to ensure prompt and appropriate investigation of all complaints and the identification and implementation of recommended improvements.
In the period from October 1st 2008 to March 31st 2009, we received 174 complaints, compared with 150 during the same period in the previous year. This represents an increase of 16%. Complaints were about a variety of issues including appointment cancellations, diagnosis problems and patient privacy and dignity. We continue to work hard to minimise all complaints, and when they do arise make sure they are dealt with in an appropriate and timely manner.
Annual Report & Accounts 2008/2009 - - 42 - - 6: Being a good citizen
Looking after the environment
As one of the major employers in the area we recognise the significant responsibility we have to our local community and the environment.
We are a “Health Promoting Hospital” and do much health education work ourselves and with other agencies. We are part of the local authority’s “Bolton Family” and members of staff sit on a number of groups and committees which work across the borough. We have worked successfully with the council and Greater Manchester Police on projects including educating youngsters about alcohol abuse.
We invited the Carbon Trust to help us identify ways in which we could reduce the hospital’s carbon footprint. Using this information, we were successful in bidding for money from the Department of Health’s Energy and Sustainability Fund. The £687k received was for ten separate schemes to be completed over two years.
Schemes that are now complete include improved heating controls in some areas, upgraded chillers and roof insulation. Schemes in progress include the expansion of our scheme to improve heating controls in individual wards and departments, the use of energy efficient lighting and further roof insulation.
We have an Environmental Management and Sustainable Development Committee, which looks at a wide range of potential recycling opportunities as well as other waste management issues and energy conservation.
We carry out recycling including cardboard, confidential waste paper, scrap metal, cooking oil etc. Our waste contractor undertakes the recycling of our general waste before it goes to landfill and around 79% of it is recycled.
All clinical waste is currently incinerated on site and approximately 40% of the hospital’s steam load for heating and hot water is generated by the waste heat boiler attached to the clinical waste incinerator.
We aim to use local contractors and suppliers where possible, in particular in catering. We also have a Fair Trade certificate.
Smoke free site
As a Health Promoting Hospital we think it is vital to promote ‘no smoking’ and in July we will totally ban smoking on our site.
We have already publicised the ban in the local media and have been encouraged by many positive comments. People who break the law by smoking in a no-smoking area such as in public buildings or under canopies may face a fine of £200 or fixed penalty of £50. The hospital has asked the local authority to help enforce this. We already provide support to patients and staff to help them stop smoking and that will continue to be available.
Annual Report & Accounts 2008/2009 - - 43 - -
Equality and diversity
The Royal Bolton Hospital serves an increasingly diverse population and it is important that everyone can access our services fairly. It is also important that our staff reflect our local community and have protected rights of equality.
The Trust has a wide range of policies which ensure that we adhere to legislation regarding equality and diversity and human rights for both staff and patients. These include policies on Equal Opportunities, Employment of People with Disabilities, Recruitment and Selection, Interpreting and Translating and Respecting Religious and Cultural Beliefs. We also produce recruitment material in different languages and our staff continue to attend equality and diversity training, as well as training in cultural and spiritual needs.
The Equality and Diversity Employment Group has continued to meet and has agreed a significant programme of work in moving forward. It will utilise baseline information on the diversity of the workforce to focus where improvements need to be made so that we see improvements in the diversity of our staff.
Health and Safety
The Trust is supported by a small team of health, safety and fire officers whose primary role is to assist managers comply with their statutory obligations. The team provides professional advice and guidance to managers with the aim of ensuring that safe working practices are adopted. The main focus of this work is the development of practical risk assessments, policies and working procedures that ensure and maintain high standards. The team provides a vital audit and monitoring role. This includes regular site inspections, safety checks and visits.
Emergency preparedness
The Trust takes emergency preparedness very seriously and we constantly review our plans and preparations for a potential flu pandemic or major incident with mass casualties. We have a full time emergency planning officer and are fully compliant with the requirements of the NHS Planning Guidance 2005 and all associated guidance. We tested our procedures in January 2009 when we took part in Operation Maximums – a region-wide exercise which tested what would happen in the event of a major incident.
Research
The Trust is involved in research and development, providing recruitment to over 30 studies approved by the National Institute of Health Research (NIHR). The main areas of research activity are medicines for children and cancer treatments. Recent work to increase the number of studies on stroke is proving successful too, with two new projects emerging in early 2009. With the progress of Making it Better and the Trust’s plans to become a regional centre of excellence in neonatal care, it is expected participation in neonatal studies will also increase.
Annual Report & Accounts 2008/2009 - - 44 - - 7: Our staff
Staff involvement
Our staff are one of our most valuable assets. The Trust consults widely with staff on major changes through constructive relationships with its Staff Side (union representatives) and a monthly Joint Consultative Committee (medical staff) and bi-monthly Joint Local Negotiating Committee. These meetings allow for strategic discussions on broader issues that affect staff and debate on infrastructure to deliver changes and engage people.
As part of Making it Better, we have involved staff in the development of plans via working groups who have given useful feedback on how the new buildings should be designed. Staff are being engaged every step of the way during the transition.
We have a number of ways of communicating with our staff, such as team brief sessions, talk time sessions, email access for all staff and a popular intranet system which includes a feedback section where staff can ask questions on any subject. The Trust’s communication strategy stresses the importance of good internal communications and as a result, we audit our team briefing system regularly.
Education
The Trust is committed to ensuring that all staff have the right skills at the right time to deliver the services of today and develop the services of tomorrow.
Responsibility for continuing professional development is shared between the individual, their manager and the Trust, as well as their lead professional body. This Trust will support the learning and development of all its staff by:
Embracing both the philosophy and the framework of Improving Working Lives Placing learning and development at the core of improving patient care Providing a range of learning opportunities to suit all staff groups regardless of level Signing and implementing the skills pledge
A fully equipped Education Centre is available to all staff and provides a variety of learning and development opportunities for medical and non-medical staff. The Education Centre has a series of classrooms, discussion and seminar rooms and a 120 seat lecture theatre, complete with video conferencing and touch pad interactive systems. There is a well stocked library. In addition there is a clinical skills centre and an information technology suite based in the main part of the hospital.
The Trust is committed to development for all staff irrespective of grade or occupation. Staff are encouraged to seek development opportunities within the workplace that will enhance practice and lead to higher standards of patient care and delivery of services.
Annual Report & Accounts 2008/2009 - - 45 - - Staff health and well-being
The Occupational Health Department exists to promote wellbeing of the individual by providing advice to all employees and management on matters relating to the effect of health on work and work on health.
All prospective employees are screened to ensure fitness for the proposed employment and to ensure any adjustments are made to accommodate those with disabilities. The department also offers advice to managers and employees following long term sickness absence or frequent, short term sickness.
Occupational Health can also help identify workplace hazards and conducts visits to departments to advise on occupational health and safety requirements in line with current legislation. Work-related health surveillance is carried out in accordance with health and safety legislation such as lung function tests or hearing tests. Vaccinations are offered to staff depending on the area of work, to prevent work-related illnesses or diseases. They also offer eyesight screening, counselling, physiotherapy and limited treatment for work-related injuries or illness such as back injuries or needlestick injuries.
This year we introduced a 24 hour helpline for staff to provide counselling support. Meditation and relaxation sessions were also organised by our Chaplaincy department. We took part in the Big Bolton Health Check, supported Weight Watchers classes, held hospital health walks, and continued to offer smoking cessation sessions for staff.
This year we also achieved European Working Time Directive compliance 12 months ahead of national target and continued to support the work life balance of our junior medical staff. We were awarded the Best Whole System Approach to EWTD implementation.
Attendance management
We work hard to ensure our staff are healthy and happy at work, and to see a year on year improvement in attendance. We have an attendance management policy and encourage staff to seek support in their health and well-being. The table below highlights the levels of absence against a target of 4.5%. Levels of absence were particularly over the winter period due to a high rate of winter illness in the community.
October 2007 5.93% October 2008 5.72% November 2007 5.93% November 2008 5.69% 5.79% 6.40% December 2007 December 2008 5.85% 5.94% Quarter3 Total Quarter3 Total
January 2008 5.98% January 2009 5.64% February 2008 5.47% February 2009 4.90% 4.89% 4.46% March 2008 March 2009 5.44% 5.01% Quarter 4 Total Quarter 4 Total
Annual Report & Accounts 2008/2009 - - 46 - - Staff values
In order for us to provide high quality care to our patients, we must ensure that our staff feel valued in their work and recognised for their contribution, no matter what their role.
We are commencing a programme of work to develop core Trust values with our staff to ensure full engagement and ownership. This will take a variety of forms including focus groups with staff and patients.
We take part in the annual national NHS staff survey which provides a useful barometer of staff opinion in the Trust. This year we were praised for our health and safety training, flexible working options and the number of staff who feel valued by their work colleagues. We recognise we need to make improvements in areas such as staff appraisals and performance development plans.
Annual Report & Accounts 2008/2009 - - 47 - - 8: Business review
Introduction
The review which follows considers the financial performance of the Trust over the full financial year 2008/9, but focuses upon the second half year October 1 2008 to March 31 2009. This is because, as previously stated, the hospital achieved foundation trust status on October 1 2008 and this report and accounts relates to the Foundation Trust for which separate accounts are required and included with this report. A separate report and accounts are available for the first six months of the financial year during which the hospital operated as an NHS Trust.
As a foundation trust, Royal Bolton Hospital Foundation Trust is accountable to Monitor – the Independent Regulator of NHS Foundation Trusts. The accounts included on this report have been prepared under a direction issued by Monitor.
Main Sources of Income
Royal Bolton Hospital Foundation Trust, in common with all NHS Hospital Trusts derives the majority of its income from providing patient care services. These are paid for by primary care trusts who receive an allocation of funds directly from the Department of Health. During 2008/9 78% of the Foundation Trust’s patient care income (68% of its total income) came from Bolton Primary Care Trust (PCT), now known as NHS Bolton. Directors and officers of the Trust work closely with their counterparts in the PCT in order to plan and monitor the quality and quantity of services provided under the contract which exists between the two bodies.
Financial Performance in 2008/9
In the three years prior to 2008/9, the Trust had turned around its financial performance from one of significant annual deficits to a position where in 2007/8 it achieved a surplus of approximately £2 million.
It was clear from the outset however, that 2008/09 would present the Trust with major financial challenges due to:
Tariff income (the principal means by which the hospital is funded) reduced by over £3 million The national requirement for hospital efficiency savings increased from 2.5% to 3%, equivalent to £4.5 million Pay awards were settled nationally at a higher cost than allowed for in the national tariffs, equivalent to £0.75 million
After allowing for some compensating factors this gave rise to a total reduction in resources of almost £8 million.
As a consequence of the above it was clear that it would not be possible to maintain the level of operational surplus achieved in 2007/8. Even after setting itself a challenging savings target of £6.25 million it was only possible to anticipate an operating surplus of £0.7 million.
Annual Report & Accounts 2008/2009 - - 48 - - Nevertheless, taking into account the expected profit of £1.8 million on the sale of the Fall Birch hospital site, the Trust set itself the target of achieving a surplus of £2.5 million.
As the year began, the financial position became even more stretched. The two most important factors were:
Energy costs As with domestic properties, the Trust was affected by major increases in electricity and gas prices. By the end of 2008/09, these together cost over £1 million more than the previous year (increased from £1,345k to £2,377k).
High levels of uncontracted activity over and above budgeted capacity, leading to abnormal costs The level of outpatients and elective (waiting list) activity which needed to be undertaken by the hospital to sustain the Government’s 18 week target (explained in the Quality section earlier in this report) turned out to be much higher than planned and contracted with the Primary Care Trust.
It had been expected that the required level of activity would decline once waiting lists had been reduced to meet the target. Consequently, permanent staff had not been employed to support the increased activity. Although income was received for the extra activity, costs increased by more than the income involved as the additional activity had to be undertaken at overtime rates.
Despite the above, in the first half year to September 30 2008, the Trust almost "broke even" - returning a small trading deficit of £87k. The Accounts for that period show a bottom line deficit of £2.35 million due to two exceptional items: the profit of £1.8 million on the sale of Fall Birch referred to above; and a fixed asset property impairment of £4.05 million as a result of a recent revaluation of the hospital estate. This latter impairment item is a largely technical matter which does not derive from the Trust’s operating performance and does not affect its cash position. During the second half year (to which these accounts relate) however, financial performance deteriorated significantly to a trading deficit of £1.5 million (see the income and expenditure account on page 1 of the accounts). The main reasons for this were as follows:
Additional Winter Pressures Winter pressures started earlier and were more costly than in previous years. As a result of a high incidence of the winter vomiting bug, norovirus, it was necessary to close a number of wards to admissions. This led to additional costs in terms of replacement wards. Furthermore, closed beds led to cancelled theatre lists which needed to be replaced at premium costs. In addition, as staff were affected, sickness levels increased further, driving up bank and agency costs.
The failure/delay of a small number of significant savings schemes which had been planned to commence mid-year It was necessary for the Trust to make significant savings in 2008/9 in order to cope with the tariff changes and other financial pressures. The majority of these savings were commenced in the first half year but in order to allow more time for planning
Annual Report & Accounts 2008/2009 - - 49 - - and consultation with staff, a small number of schemes were planned to commence in the second half year. This is a strategy which had been successful in the previous years of financial recovery but unfortunately was not so successful in 2008/9. The schemes involved initially encountered delay and subsequently proved to be over ambitious. Unfortunately by the time this became clear it was too late to identify effective replacement savings.
In summary, costs increased and the extra savings anticipated in the second half year did not occur: a planned small surplus quickly turned into an operational deficit. Steps to address this began to take effect in the final quarter of 2008/9 but will not be fully effective until 2009/10.
Taking into account the Trust’s financial performance, financial efficiency and liquidity, the Foundation Trust anticipates being assessed by Monitor as having a financial risk rating of three at the end of 2008/9 (on a scale of one to five where one is considered high risk and five is considered low risk) as follows:
Financial Criteria Weight M12 M12 Weighted % Score Risk Average Rating 1. % of Plan 10 80.05% 3 .30 2. EBITDA Margin 25 6.3% 3 .75 3. Return of Assets 20 4.1% 3 .60 4. I&E Surplus 20 0.1% 2 .40 5. Liquidity 25 30.9 4 1.0 days* Total 100 3.05
Looking Forward
Looking forward based on currently available information, the planned forecast for 2009/10 is for a significantly improved financial performance, returning the Trust to a modest surplus.
Firstly, the factors which underpinned the trading deficit in 2008/9 have been addressed as part of the financial plans for 2009/10. Additional staff have been budgeted to enable the higher levels of activity (which have now been agreed as part of the contract with Bolton PCT) to be undertaken at “normal” costs. Budgets for 2009/10 have been increased to reflect the higher level of winter costs experienced in 2008/9. Although the Government has again required hospital trusts to make savings of at least 3% in 2009/10, the Trust’s plans have been developed and planned to commence much earlier in the financial year.
Secondly, there are again major changes to income tariffs in 2009/10, but this time they are in the Trust’s favour. Whereas in 2008/9 the Trust lost over £3 million as a result of tariff changes, in 2009/10 tariff income will increase. This is due to a major national review of tariffs and market forces factors. Market forces factors vary the amount of income which hospital trusts receive to reflect higher costs in certain parts of the country (e.g. London) compared with, for example, more rural areas. A previous national review of market forces factors approximately three years ago had created significant differences between local trusts and
Annual Report & Accounts 2008/2009 - - 50 - - reduced the income received by the Royal Bolton Hospital. The new formula which takes effect from 2009/10 reduces the income differences between trusts and largely restores the income that was lost to Bolton at the last review.
The continued development of the hospital as a major provider of healthcare services within the NHS was underlined during 2008 by confirmation that women’s and children’s services within Greater Manchester will be in future concentrated upon a smaller number of specialist hospital sites, one of which will be Royal Bolton Hospital. Plans have accordingly been drawn up for an extension to maternity and children’s facilities at the hospital involving capital investment of approximately £20 million which we currently anticipate will be financed by an equivalent long term loan from Government sources. This will facilitate an expansion of services, which by 2011/12 when the development is complete, is currently expected to increase Trust income by circa £16 million per annum. This additional income will be primarily invested in the related additional staffing etc. associated with the new development plus the cost of servicing the associated loan. Subject to final capital costs and loan approval, it is anticipated that the full business case will be considered by the Board in the summer of 2009 with building work commencing later during the 2009/10 financial year.
The only other significant change to the Trust’s assets planned to take place during 2009/10 is the transfer to the Greater Manchester West Mental Health Foundation Trust of two buildings which it occupies on the Royal Bolton Hospital site. These are buildings which should arguably have been vested in the Mental Health Trust rather than the Hospital Trust when they were both formed some 15 years ago. Royal Bolton Hospital NHS Foundation Trust recovers the costs associated with these buildings from the Mental Health Foundation Trust and formally transferring ownership is not expected to affect the Hospital Trust’s financial performance or financial position. The Trust’s fixed assets will reduce by approximately £10 million, but this will be counterbalanced by an equal reduction in the public dividend capital debt to the Government. This non cash transfer has been agreed in principle by both Foundation Trust Boards and subject to final agreement, will take place in April 2009.
Risks and Uncertainties
Looking further ahead, the effect of the wider economic recession on public finances will mean that hospital trusts will continue to be expected to make efficiency savings but to an increasing extent. The national requirement for hospitals to make efficiency savings remains at 3% in 2009/10 but is currently expected to increase to 3.5% in 2010/11 and possibly to 4% in 2011/12.
The Trust has modelled its projections of income and expenditure and cash balances for these three years and currently anticipates being able to achieve this level of efficiencies. It has also considered and modelled for the principal risks and uncertainties which it faces, in particular:
the possibility that faced with constraints on their own financial resources, PCTs will take action to reduce demand and thereby reduce income to the hospital; the possibility that inflation may increase beyond that anticipated in the Trust’s plans; the possibility that savings may not be delivered as quickly or to the levels identified above.
Taking into account its financial position at the end of 2008/9 including cash balances of approximately £5.5 million (see Balance Sheet on page 2 of the accounts), future projections based on currently available information and a reasonable set of downside sensitivities, the
Annual Report & Accounts 2008/2009 - - 51 - - Board of Directors, after making enquiries, considers that the Trust has adequate resources to continue to operate as a going concern for the reasonably foreseeable future and has therefore prepared its accounts on this basis.
In this regard it should be noted that, despite the trading deficit in the second half year of 2008/9, the Trust’s net current asset balance sheet position at March 31 2009 (page 2 of the accounts) is healthier than it was 12 months ago with net current assets of £2.8 million compared with £1.5m as at 31 March 2008. In addition, long term loan liabilities have reduced from £1.5m at March 31 2008 to nil at March 31 2009. This improvement in the Trust’s balance sheet has been facilitated by the sale of the Fall Birch site for £5.1 million in April 2008. Accordingly, overall net cash funds at March 31 2009 amounted to £4.1 million (see note 18.2 to the Accounts) compares with net debt of £0.75 at March 31 2008.
Summary
In summary, after the successful achievement of a significant financial turnaround in recent years, leading to a trading surplus in 2007/8, the Trust was faced with a particularly challenging year in 2008/9 resulting in a deficit. However, in overall cash terms, this was compensated by the sale of the Fall Birch Hospital site, leading to an improved net cash position at March 31 2009 compared with March 2008. Looking ahead to 2009/10 the Foundation Trust is currently expecting to return to modest levels of surplus.
Annual Report & Accounts 2008/2009 - - 52 - - 9: Planning for the future
Our plans for 2009/10
The coming year 2009/10 will offer many more challenges and opportunities for the Trust. We will be working in the more restrictive national economic climate and our PCT commissioners will be linking our revenue streams to measures of quality and patient satisfaction. In Greater Manchester there will be changes for stroke patients so that they will only come to RBH after assessment and treatment at one of three other centres. Changes in the reconfiguration of services in North East Manchester are likely to increase the flow of emergency patients to Royal Bolton Hospital and of course the Making It Better changes will continue to gather pace.
In Bolton there will be a continued expansion of community-based facilities and Care UK is establishing Independent Sector Clinical Assessment and Treatment Services in five major specialties. Bolton PCT will be reviewing services in respiratory conditions, cardiovascular disease and maternity services as part of its draft five year strategy “Big Bolton Health Plan.”
The Trust will again be working to meet nationally set targets such as those for further reducing healthcare associated infections.
Against this background the Trust has set its own challenging ‘stretch’ goals for 2009/10. These range from further reductions in standardised mortality rates to a redesign of urgent care, and are in some cases more demanding than national mandatory targets and guidelines. Further detail can be found in the Trust’s Annual Plan at www.royalboltonhospital.nhs.uk
Annual Report & Accounts 2008/2009 - - 53 - - 10: Governance
Code of Governance
Statement of Compliance with Monitor Code of Governance
In preparation for authorisation as a foundation trust, the Trust conducted a thorough review of its governance arrangements in line with the Monitor Code of Governance. This review was presented to the Board of Directors at its meeting in October 2008 and an action plan was developed to ensure the Trust would be in a position to comply or explain against each element of the code.
The code is implemented through key governance documents, policies and procedures of the Trust, including:
The Constitution Standing Orders Standing Financial Instructions Scheme of Delegation The Code of Conduct
The audit committee reviewed the register of compliance with the code’s principles in February 2009 and approved the release of a statement that the Trust considers itself compliant with all elements of the code other than those detailed below:
C.2.1: Reappointment of Executive Directors at intervals of no more than five years - For the purpose of skill mix and stability, Executive Directors are on permanent pensionable contracts and subject to annual performance appraisal.
D.2: Performance Evaluation -The Trust intends to comply with this section of the code and will ensure that formal and rigorous evaluations of its committees and individual directors are conducted and reported to the Council of Governors in late 2009 following a full year in operation as a Foundation Trust.
Annual Report & Accounts 2008/2009 - - 54 - - Membership
Every member of the public over the age of 16 can become an FT member of the Royal Bolton Hospital and give their views on how they think we should develop our services. Through our members, we can really get to know what the public wants and, more importantly, act on that as our services evolve.
Membership strategy
We are committed to building a membership that is representative of and reflects the local communities we serve in terms of disability, age, gender, socio economics, sexuality, ethnic background and faith.
Public Members
Membership of the Trust is open to anyone who resides in England although we would expect the majority of our members to reside in the metropolitan borough of Bolton and the surrounding areas of Salford, Wigan, Bury and South Lancashire. There is a lower age limit of 16 but no upper age limit. There are no limits on the number of people who can register as members. Public members are placed in constituencies based on where they live. There are 20 constituencies representing the electoral wards of Bolton and one to represent the rest of England.
Staff Members
We have elected to adopt an opt out arrangement in respect of staff membership. Under this arrangement, staff will automatically be registered as a member of the Trust unless they have completed the opt out form which was circulated with payslips in December 2006 and January 2007. New members of eligible staff are provided with information and a form at induction. Staff membership will be eligible to everyone who is employed by the Trust full or part time on a contract with no fixed term or those staff on fixed term contracts of 12 months or more. Membership is also available to those bank staff who have an agreement to work for the Trust and have done for 12 months or more. Staff working for the Trust’s contractor for portering and domestic services are also eligible for staff membership if they meet the above criteria. Staff membership ceases at the point that the member leaves the service of the Trust. If the member of staff qualifies as a public member, their membership can then be transferred to the public constituency.
Annual Report & Accounts 2008/2009 - - 55 - - Benefits of Membership Although there are no financial benefits of FT membership, there are also no costs. There is, however, much satisfaction in being in a position which can help local people and local services. There are no benefits to members in terms of access to services. During 08/09 we held three Medicine for Members events. These informal and informative talks were well attended and well received. There will be a continuing programme of these events which will be publicised through the members’ newsletter and the Trust website. We will use our members as a valuable resource calling on those who have expressed a willingness to participate in surveys and focus groups to gain a snapshot view of the user’s perspective.
Membership Recruitment We aim to continue recruiting new members and are using a variety of methods to ensure we reach as many people as possible. People wishing to join can do so by registering online at www.royalboltonhospital.nhs.uk or by calling 0870 703 6352. Alternatively application forms are available throughout the hospital. Contact procedures for members that wish to communicate with governors and/or directors Members who wish to communicate with governors may do so by email to [email protected] or by post c/o the Trust Secretary. To communicate with directors contact [email protected]
Annual Report & Accounts 2008/2009 - - 56 - - Membership Statistics Membership size and movements
Public Constituency Last Year Next year (estimated) At year start (1 April 08) 2850 3645 New members 901 1500 Members leaving 106 145 At year end (31 March) 3645 5000
Staff Constituency Last Year Next year (estimated) At year start (1 April or 3915 3937 Authorisation) At year end (31 March) 3937 3940
Patient Constituency Last Year Next year (estimated) At year start (1 April or Authorisation) New members Not applicable Members leaving At year end (31 March)
Analysis of current public membership
Public Constituency Number of members Eligible membership1 Age 0 - 16 - - 17 - 22 271 16,200 22+ 3374 191,227 Ethnicity White 2831 182,536 Mixed 28 2,489 Asian or Asian British 438 19,083 Black or Black British 50 2,074 Other 298 1,245 Socio-economic groupings ABC1 1,827 97,366 C2 941 32,734 D 425 42,792 E 452 34,535 Gender Male 1598 100,395 Female 2047 107,032 Patient Constituency Not applicable
1 Eligible membership taken as residents of Bolton aged 16 and over June 2007 source ONS
Annual Report & Accounts 2008/2009 - - 57 - - Council of Governors
As a Foundation Trust we have a Council of Governors who represent our members, including the public, our staff and the partner organisations we work with. The Council of Governors’ role is to make sure that members’ views are represented when important decisions are taken about services, or the future direction of the organisation.
The Council of Governors is also responsible for holding the Board of Directors to account and for the appointment of the Trust Chairman and Non Executive Directors.
Elections During the period covered by the report there have been elections for public elected governor vacancies in Great Lever and Farnworth. The election was carried out by single transferable vote according to the constitution. Great Lever: Three nominations: Mrs Linda Toy elected Farnworth: No nominations: seat remains vacant. The next round of elections will commence in August 2009 for the seats of governors whose original term of office was one year and any other vacancies occurring during the interim months.
Directors and Governors Register of Interests A register is kept of directors’ and governors’ interests. Access to the register can be gained either by contacting the Trust Secretary or from the Trust web site.
Our Governors
Elected Governors - Public Constituency Committee and Date Term of Attendance (2 Sub Group Involved in other Name Area Elected Office held) Membership groups
Christina Aspden Rest of England Oct 08 2 2 A Divisional quality Denise Baldwin Rest of England Oct 08 1 2 P James Brindle Harper Green Oct 08 1 2 P Derek Burrows Kearsley Oct 08 2 2 P Martin Caplan Breightmet Oct 08 2 2 M Kate Cowpe Rest of England Oct 08 3 2 M Making it Better Mike Doyle Astley Bridge Oct 08 2 2 A,N,M,P Dave Eaton Rest of England Oct 08 3 2 P Anita Gordon Heaton and Wray Lostock Oct 08 1 2 P John Hartshorne Rumworth Oct 08 2 2 P Little Lever and Eric Hyde Darcy Lever Oct 08 3 2 P,M Divisional quality
Annual Report & Accounts 2008/2009 - - 58 - - Westhoughton Pauline Lee and Chew Moor Oct 08 1 2 P Westhoughton Helen McSorley South Oct 08 1 2 P Geoffrey Minshull Bromley Cross Oct 08 3 2 A Inayat Omarji Crompton Oct 08 1 1 Jack Ramsay Bradshaw Oct 08 3 2 M,P Clinical governance Pandemic flu, green Barbara Ronson Horwich NE Oct 08 1 2 P issues Horwich and Isabel Seddon Blackrod Oct 08 2 2 P Pandemic flu Tonge with the Jim Sherrington Haulgh Oct 08 2 2 P,N Alice Spencer2 Farnworth Oct 08 3 2 John Taylor Smithills Oct 08 3 2 M,P Linda Toy3 Great Lever Jan 09 3 0/0 Barbara Winder Hulton Oct 08 3 2 M,P Akhtar Zaman Halliwell Oct 08 1 1 Key: A: Audit. N: Nomination and remuneration. M: Membership and member communications. P: Patient, staff and visitor experience
Elected Governors – Staff Constituency
Name Area Attendance (2 Committee and Sub Date Elected Term of Office held) Group Membership
Jean Cummings All other staff Oct 08 3 2 Dipak Fatania All other staff Oct 08 2 2 M Simon French Nurses and Midwives Oct 08 1 1 P David Hamer AHP and scientists Oct 08 2 2 N Simon Kelly Doctors and Dentists Oct 08 3 0 Gail Naylor Nurses and Midwives Oct 08 1 2 A
Appointed Governors
Name Representing Date Appointed Attendance Committee and Sub (2 held) Group Membership
Tim Evans Bolton PCT Oct 08 0 Dr Riad Falouji Bolton Local Medical Committee Oct 08 1 Geoffrey Hargreaves Bolton Council For Voluntary Services Oct 08 1 P Dr George Holmes Bolton University Oct 08 0 Mohammed Koya Bolton Connexions (Youth Governor) Oct 08 2 Cllr Madeline Murray Bolton Metropolitan Borough Council Oct 08 2 Dr George Ogden Bolton Local Medical Committee Oct 08 1 Thaira Qureshi Bolton Council For Voluntary Services Oct 08 1 John Walsh Bolton Metropolitan Borough Council Oct 08 1 N Jill Wild Salford University Oct 08 2 P
2 Resigned 1st November 2008 3 Elected 22nd January 2009
Annual Report & Accounts 2008/2009 - - 59 - - Developing understanding The Board of Directors has taken steps to ensure that members of the Board, and in particular the non-executive directors, develop an understanding of the views of governors and members about their NHS Foundation Trust. Mr Cliff Morris chairs both the Board of Directors and the Council of Governors and with the assistance of the Trust Secretary is the link between the two bodies. The full Council of Governors meets a minimum of four times a year and these meetings are attended by representatives of the Executive Directors, the Senior Independent Director and representatives of the Non-Executive Directors. The governors’ meetings provide the opportunity for the governors to express their views and raise any issues so that the Executive Directors can respond. Minutes of the meeting are shared with the Board of Directors so they can pick up and respond to any issues raised. The governors have two formal sub committees dealing with Auditor appointment, and nomination and remuneration. These are attended by the Chair of Audit and Director of Finance (auditor appointment) and by the Senior Independent Director (nomination and remuneration) The three sub-groups are each chaired by a governor nominated by the group, the chairs of the sub-groups will meet with the chairman on a regular basis, these groups are also attended by the Trust Secretary. The Director of Corporate Services, Head of Communications and Head of Governance and Patient Experience also attend appropriate sub group meetings as required. The Trust recognises the importance of being accessible to members. Council of Governors meetings are held in public and publicised on the Trust website, member newsletters and notices around the hospital. The governors representing the electoral wards of Bolton attend the local area forums run by Bolton Metropolitan Council to meet individual members and hear their views.
Annual Report & Accounts 2008/2009 - - 60 - - Our Board of Directors
David Fillingham: Chief Executive Appointed Chief Executive in 2004, David has extensive senior experience in the health service and was formerly Director of the NHS Modernisation Agency.
Beverley Andrew: Director of Corporate Services Beverley started her career in Bolton in 1978. As Director of Corporate Services she leads on corporate governance including risk management, patient experience and quality, estates strategy, communications and emergency planning.
Lesley Doherty: Director of Nursing & Performance Improvement A qualified nurse and midwife and has much managerial experience including acting Chief Executive at Burnley Healthcare NHS Trust. She also acts as an advisor to the Department of Health, currently on healthcare associated infection.
Colin Dunn: Director of Finance Colin’s career has been in the Midlands and North West and he joined the Trust in 2004. He is Chair of the Greater Manchester Trusts Financial Directors Group.
Jackie Bene: Medical Director Jackie was appointed Medical Director in 2008. She trained at Sheffield University, Shrewsbury and the South West of England before moving to Greater Manchester in 1992.
Ann Schenk: Director of Service Development Ann started her career with the North Western Regional Health Authority and is currently leading on planning, strategy, IT and service improvement.
Nicky Ingham: Director of Workforce & Organisation Development After a career in a number of hospitals in the North, Nicky took up her current position in 2005. She is also Vice Chair of NHS Employers.
Cliff Morris: Chairman Appointed Chairman in 2003/4. A former Bolton mayor, Cliff is leader of the ruling Labour Group on Bolton Council and the Chair of Social Services
Yaseer Ahmed: Non-Executive Director
Annual Report & Accounts 2008/2009 - 61 - Became a Non-Executive Director in 2003. Yaseer is Managing Director of Pearl Commercial Investments and currently Manager of Bolton Council of Mosques Margaret Blenkinsop: Non-Executive Director (Deputy Chair/Senior Independent Director) Margaret had a distinguished career in education before retiring as Bolton’s Director of Children’s Services in 2007. She joined the Trust in 2005.
Arthur Rawlinson: Non-Executive Director (Chair of Audit Committee) Arthur’s background is in information technology and he was the UK General Manager for Data Centres within Fujitsu Services before retiring in 2003. He joined the Trust in 2005.
Roger McMullan: Non-Executive Director Roger, as well as having been Director and Company Secretary at Warburtons Ltd; set up Bolton Business Ventures in the 1980s, one of the first Enterprise Agencies in the UK.
Alan Rothwell: Non-Executive Director Alan is a Chartered Accountant with recent and relevant financial experience including main board directorship at North West based Ultraframe PLC and Greenalls PLC and interim Finance Director of the Argos Retail Group.
How the Board operates
The Board of Directors comprises the Chairman, Chief Executive, Senior Independent Director, four independent Non-Executive Directors, five voting Executive Directors and two non-voting Executive Directors. The Board meets in private on the last Tuesday of each month and a summary of the minutes is published on the public website.
The Directors have collective responsibility for setting strategic direction and providing leadership and governance.
The Scheme of Delegation which is included in the Trust’s standing orders, sets out the decisions which are the responsibility of the Board of Directors and those which have been delegated to a sub-committee of the Board.
The Trust has an Executive Board which consists of the Executive Directors and other senior post holders. The Executive Board meets monthly and is chaired by the Chief Executive. Its remit is to consider the operational management of the day to day business of the Trust.
As set out in the constitution, the Council of Governors consists of 24 public elected governors, six staff governors and ten appointed partner governors. The Council of Governors meets in public four times a year.
The statutory duties of the governors are to:
Set the terms and conditions of Non-Executive Directors Approve the appointment of future Chief Executives
Annual Report & Accounts 2008/2009 - 62 - Appoint or remove the Trust’s external auditor Consider the annual accounts, annual report and auditor’s report Be consulted by the Board of Directors on the forward plans for the Trust
The Board of Directors and the Council of Governors enjoy a strong and developing working relationship. Mr Cliff Morris chairs both and acts as a link between the two. Each is kept advised of the other’s progress through a number of systems, including informal updates via the Chairman, ad hoc briefings and exchange of meeting minutes etc.
Balance, Completeness and Appropriateness
There is a clear separation of the roles of the Chairman and the Chief Executive, which has been set out in writing and agreed by the Board. The Chairman has responsibility for the running the Board, setting the agenda for the Trust and for ensuring that all Directors are fully informed of matters relevant to their roles. The Chief Executive has responsibility for implementing the strategies agreed by the Board and for managing the day to day business of the Trust.
The Chief Executive has responsibility for implementing the strategies agreed by the Board and for managing the day to day business of the Trust.
All of the Non-Executive Directors are considered to be independent in accordance with the NHS Foundation Trust Code of Governance. Whilst on appointment the Chairman has to meet the Code’s ‘test of independence’, it does not apply to this role thereafter.
The Board considers that the Non-Executive Directors bring a wide range of business, commercial and financial knowledge required for the successful direction of the Trust.
The Executive Directors are experienced and were collectively responsible for drafting the various strategies which formed the Trust’s application for Foundation Trust status. These strategies were agreed by the whole Board and now form the basis of the relationship with the Regulator. All Directors are equally accountable for the proper management of the Trust’s affairs.
All Directors are subject to an annual review of their performance and contribution to the management and leadership of the Trust. During the Foundation Trust application process, the Board used external facilitators to work with the Directors on Board development.
At the present time the Board is satisfied as to its balance, completeness and appropriateness, but will keep these matters under review.
Annual Report & Accounts 2008/2009 - 63 - Attendance at meetings
Board of Audit Council of Remuneration Directors Committee Governors Committee (6 meetings) (4 meetings) (2 meetings) (2 meetings)
Cliff Morris 6 n/a 2 2
David 6 n/a 1 2 Fillingham
Yaseer Ahmed 5 2 1 2
Beverley 6 n/a 2 n/a Andrew
Jackie Bene 6 n/a 2 n/a
Margaret 5 4 2 2 Blenkinsop
Lesley Doherty 5 n/a 1 n/a
Colin Dunn 6 n/a 1 n/a
Nicky Ingham 5 n/a 0 2
Roger 6 2 1 2 McMullan Arthur 5 2 2 2 Rawlinson
Alan Rothwell 6 4 2 2
Ann Schenk 6 n/a 2 n/a
n/a = not applicable - attendance not required at this committee
Annual Report & Accounts 2008/2009 - 64 - Audit committee
Following authorisation as a Foundation Trust on October 1st 2008, the Council of Governors at its meeting on October 13th 2008 approved the continued appointment of the Audit Commission as the Trust’s External Auditor until March 31st 2009. At its meeting on January 12th 2009 the Council of Governors approved the appointment of the Audit Commission for a further two years until March 31st 2011 The Audit Committee met on four occasions during the period Oct 1st 2008 - March 31st 2009 and at its February meeting conducted a self assessment of the effectiveness of the committee. The purpose of the Audit Committee is to provide the independent assurance to the board that there are effective systems of governance, risk management and internal control for all matters relating to corporate and financial governance and risk management. Key activities during the period October 1st 2008 - March 31st 2009 were: Reviewing the Board Assurance Framework and Risk Register Reviewing financial statements for the period 1st April 08 - 30th September 08 Receiving reports from the internal and external auditor Receiving internal reports
On occasion the Trust may decide to request additional services from the Audit Commission. When additional services are requested auditor objectivity and independence is safeguarded by seeking the approval of the full Council of Governors on a case by case basis, following recommendations from the Audit Committee.
Nomination and remuneration committee
The committee:
Reviews the structure, size and composition (including skills, knowledge and experience) required of the Board of Directors compared to its current position and makes recommendations for change when appropriate. Considers succession planning arrangements for Directors and other senior executives and is responsible for identifying and nominating candidates to fill Board vacancies as and when they arise. Agrees remuneration levels for senior posts.
Membership of the committee comprises Non-Executive Directors and the Chairman with the Chief Executive and Director of Workforce and Organisational Development in attendance.
There is also a Governors’ Nomination and Remuneration Committee which will identify and nominate Non-Executive Directors and the Chair and agrees levels of remuneration for these
Annual Report & Accounts 2008/2009 - 65 - roles. The Senior Independent Director chairs the Governors Nomination and Remuneration Committee.
Annual Report & Accounts 2008/2009 - 66 - Remuneration report
Remuneration and conditions of service for the Chief Executive and Executive Directors are dealt with by the Remuneration Committee, whose membership is detailed on the previous page.
Salary and Pension Entitlements of Senior Managers
Remuneration
Name & Title October to March 2009 Salary (Bands Other Remuneration (Bands of Taxable Benefit of Lease of £5,000) £5,000) Car £000 £000 £ Executive Directors D Fillingham 75-80 Chief Executive B Andrew Director of Corporate 45-50 200 Services L Doherty Director of Nursing & 45-50 100 Performance Improvement A Schenk Director of Service 40-45 Development J Bene 20-25 50-55 Medical Director
C Dunn 45-50 Director of Finance N Ingham Director of Workforce & 40-45 Organisational Development Non Executive Directors C Morris Chairman 10-15
M Blenkinsop 5-10
Y Ahmed 0-5
A Rawlinson 0-5
A Rothwell 5-10
R McMullan 0-5
Annual Report & Accounts 2008/2009 - 67 - Pension Benefits
Name & Title Real Real Total Lump sum Cash Cash Real Employers increase in increase in accrued at age 60 Equivalent Equivalent increase in Contribution pension at pension pension at related to Transfer Transfer Cash to age 60 lump sum age 60 at 31 accrued Value at 31 Value at 30 Equivalent Stakeholder (Bands of at age 60 March 2009 pension at March 2009 September Transfer Pension (To £2,500) (Bands of (Bands of 31 March 2008 Value nearest £2,500) £2,500) 2009 £100) (Bands of £2,500) £000 £000 £000 £000 £000 £000 £000 £ D Fillingham 0-2.5 0-2.5 40-42.5 120-122.5 730 569 103 Chief Executive B Andrew Director of Corporate 0-2.5 0-2.5 37.5-40 115-117.5 723 572 96 Services L Doherty Director of Nursing & 0-2.5 0-2.5 32.5-35 100-102.5 630 498 84 Performance Improvement N Ingham Director of Workforce& 0-2.5 0-2.5 10-12.5 35-37.5 155 120 22 Organisational Development A Schenk Director of Service 0-2.5 0-2.5 27.5-30 87.5-90 600 461 90 Development J Bene 0-2.5 2.5-5 25-27.5 80-82.5 431 324 70 Medical Director C Dunn 0-2.5 0-2.5 40-42.5 120-122.5 905 668 154 Director of Finance
Pension arrangements for the Chief Executive and all Executive Directors are in accordance with the NHS Pension Scheme. The accounting policies for pensions and other relevant benefits are set out in Note 1.14 to the accounts.
Signed June 8th 2009
Annual Report & Accounts 2008/2009 - 68 - Statement of Policy
Executive Director salaries are decided by the Nomination and Remuneration Committee taking account of benchmarking reports on NHS executive salaries, and also the financial circumstances relating to the Trust as a whole.
Methods of Assessment
The method of assessment of Executive Directors is by way of 360 degree appraisal and subsequent report by the Chief Executive to the Remuneration and Terms of Service Committee.
Remuneration not subject to performance
Individual performance bonuses are not paid to the Executive Team.
All Executive Directors of the Trust Board have permanent contracts of employment, and are not subject to fixed term arrangements. Non-Executive Directors including the Trust Chair are however subject to fixed term appointments. Details are set out in the table on page 66 in this report.
The remuneration arrangements for both Executive and Non-Executive Directors including the Chair are disclosed on page 66 of the annual report.
There was no compensation paid to any past or current members of the Board of Directors during the year.
Signed……………………………………….
Chief Executive DATE
Annual Report & Accounts 2008/2009 - 69 - Statement of Accounting Officer’s responsibilities
The National Health Service Act 2006 states that the Chief Executive is the Accounting Officer of the NHS Foundation Trust. The relevant responsibilities of Accounting Officer, including their responsibility for the propriety and regularity of public finances for which they are answerable, and for the keeping of proper accounts, are set out in the Accounting Officers’ Memorandum issued by Monitor, the independent regulator of NHS foundation trusts.
Under the National Health Service Act 2006, Monitor has directed the Royal Bolton Hospital NHS Foundation Trust to prepare for each financial year a statement of accounts in the form and on the basis set out in the Accounts Direction. The accounts are based on an accruals basis and most give a true and fair view of the state of affairs of the Royal Bolton Hospital NHS Foundation Trust and of its income and expenditure, total recognised gains and losses and cash flows for the financial year.
In preparing the accounts, the Accounting Officer is required to comply with the requirements of the NHS Foundation Trust Financial Reporting Manual and in particular to:
observe the Accounts Direction issued by Monitor, including the relevant accounting and disclosure requirements, and apply suitable accounting policies on a consistent basis;
make judgements and estimates on a reasonable basis;
state whether applicable accounting standards as set out in the NHS foundation trust Financial Reporting Manual have been followed, and disclose and explain any material departures in the financial statements; and
prepare the financial statements on a going concern basis.
The Accounting Officer is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the NHS Foundation Trust and to enable him/her to ensure that the accounts comply with requirements outlined in the above mentioned Act. The Accounting Officer is also responsible for safeguarding the assets of the NHS Foundation Trust and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
To the best of my knowledge and belief, I have properly discharges the responsibilities set out in Monitor’s NHS Foundation Trust Accounting Officer Memorandum.
Signed……………………………………….
Chief Executive DATE June 8th 2009
Annual Report & Accounts 2008/2009 - 70 -
Annual Report & Accounts 2008/2009 - 71 - Independent Auditor’s report to the Board of Governors of Royal Bolton Hospital NHS Foundation Trust
I have audited the financial statements of Royal Bolton Hospital NHS Foundation Trust for the six month period ended 31 March 2009 under the National Health Service Act 2006. The financial statements comprise the Income and Expenditure Account, the Balance Sheet, the Cash Flow Statement, the Statement of Total Recognised Gains and Losses and the related notes. These financial statements have been prepared under the accounting policies set out within them. I have also audited the information in the Remuneration Report that is described as having been audited.
This report is made solely to the Board of Governors of Royal Bolton Hospital NHS Foundation Trust as a body in accordance with paragraph 24(5) of Schedule 7 of the National Health Service Act 2006. My work was undertaken so that I might state to the Board of Governors those matters I am required to state to it in an auditor’s report and for no other purpose. In those circumstances, to the fullest extent permitted by law, I do not accept or assume responsibility to anyone other than the Foundation Trust as a body, for my audit work, for the audit report or for the opinions I form.
Respective responsibilities of the Accounting Officer and auditor The Accounting Officer’s responsibilities for preparing the financial statements in accordance with directions made by the Independent Regulator of NHS Foundation Trusts (Monitor) are set out in the Statement of Accounting Officer’s Responsibilities.
My responsibility is to audit the financial statements in accordance with statute, the Audit Code for NHS Foundation Trusts and International Standards on Auditing (UK and Ireland).
I report to you my opinion as to whether the financial statements give a true and fair view in accordance with the accounting policies directed by Monitor as being relevant to NHS Foundation Trusts. I report whether the financial statements and the part of the Remuneration Report to be audited have been properly prepared in accordance with the accounting policies directed by Monitor as being relevant to NHS Foundation Trusts. I also report to you whether, in my opinion, the information which comprises the Directors’ Report (‘Business Review’), included in the Annual Report, is consistent with the financial statements. I review whether the Accounting Officer’s statement on internal control reflects compliance with the requirements of Monitor contained in the NHS Foundation Trust Financial Reporting Manual 2008/09. I report if it does not meet the requirements specified by Monitor or if the statement is misleading or inconsistent with other information I are aware of from my audit of the financial statements. I am not required to consider, nor have I considered, whether the Accounting Officer’s statement on internal control covers all risks and controls. Neither am I required to form an opinion on the effectiveness of the Trust's corporate governance procedures or its risk and control procedures.
Annual Report & Accounts 2008/2009 - 72 - I read the other information contained in the Annual Report and consider whether it is consistent with the audited financial statements. This other information comprises: the Chairman and Chief Executive’s Statement, Hospital Services at the Heart of Bolton, the Quality Report, Improving Patient Care, Patient and Public Involvement, Being a Good Citizen, Our Staff, Planning for the Future, Governance and the un-audited part of the Remuneration Report. I consider the implications for my report if I become aware of any apparent misstatements or material inconsistencies with the financial statements. My responsibilities do not extend to any other information.
Basis of audit opinion
I conducted my audit in accordance with the National Health Service Act 2006 and the Audit Code for NHS Foundation Trusts issued by Monitor, which requires compliance with International Standards on Auditing (United Kingdom and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements and the part of the Remuneration Report to be audited. It also includes an assessment of the significant estimates and judgments made by the directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Trust's circumstances, consistently applied and adequately disclosed.
I planned and performed my audit so as to obtain all the information and explanations which I considered necessary in order to provide me with sufficient evidence to give reasonable assurance that: the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error; and the financial statements and the part of the Remuneration Report to be audited have been properly prepared. In forming my opinion I also evaluated the overall adequacy of the presentation of information in the financial statements and the part of the Remuneration Report to be audited.
Opinion In my opinion: the financial statements give a true and fair view of the state of affairs of Royal Bolton Hospital Foundation Trust as at 31 March 2009 and of its income and expenditure for the period then ended in accordance with the accounting policies adopted by the Trust; the part of the Remuneration Report to be audited has been properly prepared in accordance with the accounting policies directed by Monitor as being relevant to NHS Foundation Trusts; and information which comprises the Directors’ Report (‘Business Review’), included in the annual report, is consistent with the financial statements.
Annual Report & Accounts 2008/2009 - 73 - Certificate I certify that I have completed the audit of the accounts in accordance with the requirements of the National Health Service Act 2006 and the Audit Code for NHS Foundation Trusts issued by Monitor.
Julian Farmer 8 June 2009 Officer of the Audit Commission Audit Commission First Floor, Block 4 The Heath Technical & Business Park Runcorn Cheshire WA7 4QF
Annual Report & Accounts 2008/2009 - 74 - Statement on Internal Control 1ST OCTOBER 2008 - 31ST MARCH 2009
1. Scope of responsibility The Board is accountable for internal control. As Accounting Officer and Chief Executive of this Board I have responsibility for maintaining a sound system of internal control that supports the achievement of the NHS Foundation Trust’s policies, aims and objectives, whilst safeguarding the public funds and departmental assets for which I am personally responsible, in accordance with the responsibilities assigned to me. I am also responsible for ensuring that the NHS Foundation Trust is administered prudently and economically and that resources are applied efficiently and effectively. I also acknowledge my responsibilities as set out in the NHS Foundation Trust Accounting Officer Memorandum.
2. The purpose of the system of internal control The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to identify and prioritise the risks to the achievement of the policies, aims and objectives of Royal Bolton Hospital NHS Foundation Trust, to evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically. The system of internal control has been in place in Royal Bolton Hospital NHS Foundation Trust for the six months ended 31 March 2009 and up to the date of approval of the annual report and accounts. As an employer with staff entitled to membership of the NHS Pension Scheme control measures are in place to ensure all employer obligations contained within the Scheme regulations are complied with. This includes ensuring that deductions from salary, employee’s contributions and payments into the scheme are in accordance with the scheme rules and that member pension scheme records are accurately updated in accordance with the timescales detailed in the regulations. Control measures are in place to ensure that all the organisation’s obligations under equality, diversity and human rights legislation are complied with.
3. Capacity to handle risk 3.1 Leadership Responsibility of the Chief Executive The Chief Executive has overall accountability and responsibility for risk management within Royal Bolton Hospital NHS FT. The Chief Executive holds each line manager accountable for setting objectives, relevant to the Board’s corporate objectives for their own staff. The Chief Executive is a member of the Finance Committee and attends other trust wide committees and is also personally involved in the management of complaints against the Trust.
Annual Report & Accounts 2008/2009 - 75 -
Responsibility of the Director of Corporate Services The Director of Corporate Services has overall responsibility for organisational risk management and has managerial responsibility for clinical governance, clinical effectiveness, audit and research & development with the Medical Director providing the professional lead. The Director of Corporate Services attends the Audit Committee and is a member of the Clinical Governance & Quality Committee and the Finance Committee. The Risk Management Committee and Estates Strategy Committee are chaired by the Director of Corporate Services who is also responsible for the management of claims and complaints against the Trust. The post of Head of Governance & Patient Experience and Corporate Quality Manager support the delivery of the Governance & Quality agenda.
Responsibility of the Director Of Nursing and Performance Improvement The Director of Nursing and Performance Improvement is operationally responsible for the delivery of all clinical and operational services within the Trust through the divisions. This includes the achievement of key performance indicators on patient access and patient safety. The Director of Nursing is also the Director of Infection Prevention and Control for the Trust. The role also includes the professional leadership of nurses and midwives and providing advice to the Board on nursing issues in addition to representing Allied Health Professionals and healthcare scientists at Board level. The posts of Head of Performance, Senior Nurse (older people) and Head of Clinical Practice support the delivery and monitoring of key performance targets and developing and supporting clinical practice throughout the Trust.
Responsibility of the Medical Director The Medical Director provides professional clinical leadership for governance and patient safety within the Trust. The Medical Director chairs the Clinical Governance and Quality Committee. The Medical Director also provides medical advice to the Board and is professionally responsible for clinical effectiveness, audit and research and development and medical education. The Medical Director is supported by the Associate Medical Directors and the Clinical Leads for clinical effectiveness, patient safety and post graduate education
Responsibility of the Director of Finance The Director of Finance is the responsible officer for managing financial risk in the Trust and is also responsible for performance reporting, information and procurement. The Director of Finance provides professional financial advice to the Board. The Director of Finance attends the Audit Committee and sits on the Finance Committee.
3.2 Committees The following Board sub committees and Trust wide committees provide additional assurance to the Board having explored relevant key issues in greater depth:
Annual Report & Accounts 2008/2009 - 76 - Sub committees Audit Remuneration Finance Trust wide committees IM & T committee Estates Strategy Committee Workforce Committee Bolton Improving Care System Committee Risk Management Committee Clinical Governance & Quality Committee In particular the Audit Committee which includes all Non-Executive Directors and is attended regularly by at least two Executive Directors is responsible for continuously reviewing and monitoring the Assurance Framework. The minutes of this committee are discussed at the full Board of Directors. The Executive team is supported by a divisional management structure consisting of four divisions. Each division has a Divisional General Manager accountable for the delivery of key objectives in their areas of responsibility. Each division is supported by a divisional nurse (other than Diagnostics, Therapies and Facilities Division) and an Associate Medical Director who have specific responsibility for delivering on patient safety, quality and the governance agenda. The four divisions are accountable to the Director of Nursing and Performance Improvement. The remainder of the Trust’s business is managed by the following functional directorates: Finance Information & Procurement Workforce & Organisational Development Corporate Services Nursing and Performance Improvement Service Development Medical During the period covered by this statement of internal control the Trust has continued to work towards its 5 year vision and strategy ‘Best Possible Care – now and into the Future’. The strategy is closely linked to the Bolton Improving Care System (BICS) which is in its fourth year. Performance monitoring reports are provided to the Executive Board and Board of Directors, on a monthly basis. The minutes of all the Trust wide committees are also seen by the Executive Board. In addition a Non-Executive Director is attached to each Trust wide Committee. The Audit Committee received the Board Assurance Framework and the Trust Risk Register twice in this period. A report on Standards for Better Health was also made to the Board of Directors in this period. The Board of Directors receive reports twice per year on these topics. The Board of Directors
Annual Report & Accounts 2008/2009 - 77 - also receive quarterly CLIP reports combining complaint, litigation, incidents and PALS issues. The Finance Committee meet monthly and also function as an investment committee in respect of major capital expenditure. The Finance Committee monitor the Trust’s operational budget position, cash balances and progress against the Trust’s investment improvement and savings plan. The Finance Committee also monitor the Trust’s capital programme. The minutes of the Finance Committee also go to the full Board of Directors. As Accountable Officer I have overall accountability for Internal Control. To support this role there are clear systems of accountability within the organisation with each Executive Director having specific areas of responsibility. Performance against the Trust’s objectives is reported to the Board on a monthly basis. Arrangements are in place for the reporting of serious untoward incidents to the Strategic Health Authority (SHA) and other stakeholders through the Trust’s Incident Reporting Policy. The Trust also links to the National Reporting and Learning System (NRLS) of the National Patient Safety Agency.
3.3 Processes in place by which we work with partner organisations. The Trust’s principal partner organisation is NHS Bolton (Bolton Primary Care Trust) and a series of working arrangements are in place relating both to their role as commissioner and a co-provider of services. Joint planning and development intentions are embodied in Contract Strategic developments are regularly discussed covering elective access and urgent and emergency care. Directors from both organisations are involved in these meetings Members of the Executive teams of both the Trust and PCT meet on a regular basis. Non-Executives of both organisations meet and there are occasional Board to Board meetings Joint performance review mechanisms are in place focusing on key contract deliverables and NHS plan target delivery. A complex array of planning forums exist to focus professional advice and managerial action across a range of priority agendas, including services for Older People, Cancer Services, Children’s Services, CHD, Diabetes, Urgent Care Services, Access, Choice and Booking. A Clinical Standards Board, Medicine Management Committee and a Clinical Forum are also in place to enable clinicians and managers to work together on a range of clinical issues such as clinical pathways, medicine management and clinical risk management. A Health Economy Wide Safety Committee ensures that safety is addressed across the health economy. NHS Bolton is represented on the Trust’s Clinical Governance & Quality Committee and the Trust is represented on the PCT’s Clinical Governance Committee.
Annual Report & Accounts 2008/2009 - 78 - Relationships and working arrangements with the SHA are conducted principally through: SHA led Greater Manchester joint planning networks e.g. for Cancer, Women’s and Children’s Services and IT etc. Routine contact between senior officers and their counterparts. Overarching partnership structures, embracing local authority, NHS and non statutory sector organisations provide a framework for borough wide strategic development and the Trust is an active member of the Vision Steering group and its partnership boards including the Children’s Trust, Local Safeguarding Children’s Board and local safeguarding adults board.
3.4 Training To ensure the successful achievement of the Risk Management Strategy and implementation of the Risk Management Policy staff at all levels are provided with appropriate training in carrying out risk assessments and the reporting of incidents. Risk management, incident reporting, risk assessment training, risk register training, managing safety, fire safety training, manual handling, child protection training and conflict resolution training all form part of an ongoing programme of training within the Trust. Medicine management training is delivered at doctors’ induction programmes and during educational and developmental sessions. Medication error reports are brought to the Clinical Governance and Quality Committee and disseminated to the divisions through the Divisional Quality Managers. Support and advice on medicine management is also provided at ward and departmental level by the Chief Pharmacist and link pharmacists. Risks and safety in respect of clinical equipment and devices is discussed and disseminated by the Medical Devices and Equipment Management Committee on which all divisions are represented and which also has a training sub group and each ward has a link nurse. General awareness raising on risk management issues is achieved through staff briefings, team brief, safety bulletins, induction and the intranet. The Trust has a Patient Experience Group (PEG) which is chaired by the Head of Governance & Patient Experience and includes the Customer Relations Co-ordinator, PALS Officer, Divisional Quality Managers, Foundation Trust Governors, Lay members, Equality & Diversity Manager, Head of Clinical Practice and the Senior Nurse for Older People. The purpose of the group is to identify themes from complaints and PALS issues on a monthly basis and to agree lessons to be learnt and actions to be taken to improve patient experience and ensure this information is shared across the organisation. Work is also undertaken on audits or particular issues such as protected meal times, mixed sex accommodation, nutritional assessments, patient records and infection control
4. The risk and control framework The risk management policy outlines the responsibilities of the following executives:
Annual Report & Accounts 2008/2009 - 79 - Chief Executive Director of Corporate Services Director of Finance Director of Nursing & Performance Improvement The responsibility for risk management and clinical risk are incorporated into the post of corporate quality manager. the post of fire safety manager meets the requirements of the hospital technical memorandum 05-01: managing healthcare fire safety and he reports to the corporate quality manager. The role of head of governance & patient experience plays a key role in advising and co-ordinating governance, the Annual Health Check, NHSLA Standards and is responsible for governance, equality and diversity, clinical effectiveness and clinical and organisational risk as the line manager of the corporate quality manager. Responsibility for risk management for all levels of staff is fully outlined in the Trust’s policy on risk management responsibilities. A Board endorsed risk management strategy and policy is in place which describes the following: statement of policy aims strategic objectives philosophy of risk management total risk control risk management structure risk management responsibilities process of evaluating and prioritising risk risk register performance management monitoring and review risk management training and support fair blame culture stakeholder involvement The risk management strategy also links to other Trust policies, e.g. risk management policy and protocols, e.g. accident/incident reporting & investigation and root cause analysis. The strategy is available to staff in all wards and departments via the Trust intranet. The risk management strategy was reviewed and approved on 29th July 2008 to reflect the organisational structure and to meet the requirements of the new NHSLA Risk Management Standards.
4.1 Risk management is embedded in the trust
Annual Report & Accounts 2008/2009 - 80 - Risk management is embedded within the Trust through key committees: Audit Committee Finance Committee Risk Management Committee Clinical Governance & Quality Committee IM & T Committee Workforce Committee Minutes of these groups are exchanged and made available to staff through the intranet, meetings and bulletins. Other groups which cover risk issues include: Health & Safety Committee Radiation Protection Committee Medical Devices and Equipment Management Committee Divisional Quality Boards Infection Control Committee (reports to Clinical Governance Committee) Local Security Management Committee Fire Safety Committee Emergency Preparedness Steering Group The implementation of the Trust’s policies and procedures is the responsibility of functional directors, divisional general managers, heads of service and departmental managers The Board of Directors received a significant assurance from internal audit on its corporate governance arrangements in the first six months of the year.
4.2 Board assurance framework A Board approved assurance framework was in place for the period 1st October 2008 – 31st March 2009. The framework: covers all of the Trust’s main activities identifies the corporate objectives and targets the Trust is striving to achieve and covers the core standards on which the Trust is required to declare its compliance during 2008/09 identifies risks to achievement of these objectives and targets identifies the system of internal control in place to manage the risks identifies and reviews the assurance mechanisms which relate to the effectiveness of the system of internal control The Board receives updates on high/significant risks and risks are documented in the Trust Risk Register. The Risk Management Committee consider high and significant risks and recommends their inclusion on the Trust Risk Register. The Trust Risk
Annual Report & Accounts 2008/2009 - 81 - Register and Assurance Framework go to the Audit Committee four times per year and to the Board twice a year. Risk prioritisation and action planning is informed by the corporate objectives of the Trust, incident reports, litigation claims, audit information, complaints, individual issues from divisions, directorates and national requirements/guidance. Action plans are developed for unresolved risks and the scoring of risks is adapted from the Australian Risk Management scoring system. Lead managers and directors are identified to deal with gaps in control and assurance and are responsible for developing action plans to address the gaps. The Board received a significant assurance from internal audit for its Board assurance process in March 2008/9.
4.3 Standards for better health The Trust’s Assurance Framework and objectives are linked to the core standards. The Trust’s Standards for Better Health Steering Group includes Lay representation. Each of the seven domains are led by an executive director or senior manager. The domain leads reviewed the evidence to support the Trust’s Annual Health Check declaration for compliance against the 24 core standards and the Hygiene Code and an interim report was prepared for presentation to the Audit Committee. On 24th February 2009 the Board agreed the basis for its declaration for 2008/09. The Trust was unable to declare in year compliance with C9 of the core standards (data control and security) following an incident in January 2009, relating to the temporary loss of patient data during transportation of confidential waste. The Trust acted promptly in recovering the lost information and a helpline was established for patients. In view of the severity of the incident (category iii) a full serious untoward incident investigation was established and changes to the arrangements and processes were approved by the Board on 31 March 2009. The Trust was therefore compliant by year end. Following an inspection by the Health Care Commission under the hygiene code the trust has also declared non-compliant in year with standards C4a, C4c and C21. An action plan was implemented immediately after the inspection. The Board achieved significant assurance from internal audit on the Annual Health check process in March 2009.
4.4 Information governance controls The Trust’s IT security policy has been revised and approved to take into account new requirements. It is mandated that all new bulk flows of data must be registered with the Information Governance Group. Other flows of personal data have been documented and mapped as per the requirements of the Department of Health. The Trust has embarked on a programme of encrypting all laptops and desktop PC’s. A folder redirection system has been rolled out across the Trust to ensure that all critical and sensitive data is securely stored centrally and not on local equipment. All portable devices such as memory sticks that are plugged into PC’s and laptops have enforced encryption.
Annual Report & Accounts 2008/2009 - 82 - In September the Board of Directors agreed to the continued use of PDAs, on the proviso that staff were reminded again that such devices should be used solely for the purposes of diary synchronisation and no personally identifiable data stored on them. Until email encryption is available all staff have been reminded that email should not be used to send personally identifiable data, (unless NHSmail is used) and messages remain within NHS net. The Senior Information Risk Owner (SIRO) for the Trust is Ann Schenk, Director of Service Development. The Trust has submitted its Statement of Compliance and Information Governance toolkit (IGT) to Connecting for Health. The IGT records the status of a number of controls against Information Governance Standards. The overall score of 70% shows the Trust as in the top category of compliance. A programme of work has been developed, approved and monitored by the IM&T Committee With the implementation of the National Reference Solution Patient Administration System (LE2.2) and related functionality in December 2008 the Trust has now extended Registration Authority authentication to all staff who access relevant patient information systems. Training for LE2.2 has also provided an opportunity to reinforce staff awareness of data security issues and their responsibilities in this respect.
4.5 Public involvement The Trust engages with the public in a number of ways in relation to risk management. There is lay representation on the Clinical Governance and Quality committee, Pandemic Flu planning group and Patient Experience Group.
4.6 CNST/NHSLA Standards The Trust has not been assessed against the CNST Maternity Standards since 2005 when it achieved level 2. The Trust will be reassessed in 2009/10. In December 2007 the Trust was assessed for compliance against the new NHSLA Risk Management Standards for Acute Trusts and achieved level II compliance maintaining the 20% reduction in CNST contributions. The Trust is working towards the level 3 standards.
5. Review of economy, efficiency and effectiveness of the use of resources The Trust regularly reviews the economic, efficient and effective use of resources with robust arrangements in place for setting objectives and targets on a strategic and annual basis. These arrangements include: ensuring the financial strategy is affordable Scrutiny of cost savings plans Co-ordination of individual and departmental objectives with corporate objectives using lean methodology. Performance against objectives is monitored and actions identified through a number of channels
Annual Report & Accounts 2008/2009 - 83 - Approval of annual budgets by the Board of Directors Monthly reporting to the Board of Directors on key performance indicators Monthly review of financial targets by the Finance Committee Quarterly reporting to Monitor and compliance with terms of authorisation. The Trust also participates in initiatives to ensure value for money for example: The Trust uses lean methodology to optimise the efficient and effective use or resources whilst enhancing the patient experience. Procurement of goods and services is undertaken thorough professional procurement staff and through working with neighbouring organisations within a procurement hub. In year cost pressures are rigorously reviewed and challenged, and alternatives for avoiding cost pressures are always considered.
6. Review of effectiveness As Accounting Officer, I have responsibility for reviewing the effectiveness of the system of internal control. My review of the effectiveness of the system of internal control is informed by the work of the internal auditors and the Executive Directors within the NHS foundation trust who have responsibility for the development and maintenance of the internal control framework, and comments made by the external auditors in their management letter and other reports. I have been advised on the implications of the result of my review of the effectiveness of the system of internal control by the board, the Audit Committee and Risk Management Committee, and a plan to address weaknesses and ensure continuous improvement of the system is in place. The Assurance Framework itself provides me with evidence that the effectiveness of controls that manage the risks to the organisation achieving its principal objectives have been reviewed. My review has also been informed by o self-assessment against the Audit Commission’s External Auditors Local Evaluation (ALE) criteria o The Head of internal audit overall significant opinion on the system of internal control. o the process of arriving at the Trust’s declaration against the Standards for Better Health core standards. o the process of applying to become a NHS Foundation Trust also provided me with additional assurance. I have been advised on the implications of the result of my review of the effectiveness of the system of internal control by: The Board who receive monthly performance reports covering the Trust’s objectives, Improving Health, Best Possible Care, Value for Money, Joy and Pride in Work and Quarterly Reports on complaints, litigation, incident reporting, Serious Untoward Incidents and Patient Advice and Liaison Service (PALS) issues.
Annual Report & Accounts 2008/2009 - 84 - The Audit Committee who on a quarterly basis receive and review the Board Assurance Framework and Trust Risk Register, and also monitor progress and action taken in relation to external audit and internal audit reports. The Committee also review and monitor the Trust’s self-assessment against the Audit Commission’s Auditors Local Evaluation criteria and associated action plan. The Finance Committee who monitor the organisations financial performance, review progress against the organisation’s investment, improvement and savings plan and recommend a capital programme to the Board and monitor and approve in year amendments. The Clinical Governance & Quality Committee who review aspects of patient safety, patient experience and clinical effectiveness and clinical audit. The Committee review the Complaints, Litigation, Incidents and PALS report (CLIP) prior to consideration by the Board. The Risk Management Committee who review and monitor staff accidents and incidents, and divisional and trust risk registers. Training and Health and Safety audits are also reviewed by the Committee. Executive Directors - I have regular meetings with my Executive Directors, who advise me of actions they have taken to review the effectiveness of the system of internal control in their areas of responsibility.
7. Conclusion 7.1 Significant Control Issues 7.1.1 The Trust failed to meet the 98% target for patients to be admitted, transferred or discharged from A&E within four hours. In line with many others the effects of an early and severe winter with an increase in respiratory diseases and outbreaks of norovirus meant that the last two quarters of the year saw patients waiting for longer than acceptable in A&E. An urgent care project plan with seven streams of work each led by a senior manager and focused attention by the BICS team is in place. The Trust is also working closely with the PCT and local authority to ensure improvement in 2009/10. 7.1.2 Please refer to 4.3 for significant control issues with regard to data control and hygiene, although not compliant in year the Trust is confident that it was fully compliant at the end of the year.
Signed
Chief Executive 20th April 2009:
Annual Report & Accounts 2008/2009 - 85 - Freedom of Information and data protection
We combine a culture of openness about our hospital with a robust process to ensure patient confidentiality and data protection. Audits have confirmed that we have clear systems and processes in place to manage data protection and all Freedom of Information requests.
Between October 2008 and March 2009, we received 122 requests for information under the Freedom of Information Act.
In the same six months, we had one data loss incident. At the end of January 2009 an independent contractor removing confidential waste from the hospital dropped some documents in the road nearby. Although the papers were quickly retrieved by staff and some members of the public who stopped to help, we completed a thorough review of our processes. The papers, which included labels as well as some more detailed information, related to around 1300 patients.
We have now changed contractor so that confidential waste is shredded on site and have provided secure bins where staff can “post” relevant papers.
At the time of the incident we wrote to all those people affected and set up an information line to answer initial queries from the patients.
Annual Report & Accounts 2008/2009 - 86 - 11. Financial performance
Financial Key Performance Indicators
Risk Ratings
NHS Foundation Trusts are assessed as to their level of financial risk according to a scale of risk ratings, where one is the highest risk and five the lowest risk. RBH is assessed as level three risk for the period October 2008 to March 2009. There are five financial indicators which are used to derive an overall consolidated figure.
Financial Criteria Weight % Metric to be Scored M12 M12 Weighted Score Risk Average Rating 1. Achievement of 10 EBITDA achieved (% of plan) 80.05% 3 .30 Plan 2. Underlying 25 EBITDA margin (%) 6.3% 3 .75 Performance 3. Financial 20 Return on assets excluding 4.1% 3 .60 Efficiency dividend (%) 4. Financial 20 I&E (income and 0.1% 2 .40 Efficiency expenditure) Surplus margin net of dividend (%) 5. Liquidity 25 *Liquidity days 30.9 4 1.0 days* 100 3.05
Prudential Borrowing Code
NHS Foundation Trusts are granted financial and operational freedoms which permit them to borrow subject to their ability to service the loans and being financially stable. This Prudential Borrowing Limit (PBL), which is set by Monitor annually, is based on the FT being able to meet five Prudential Borrowing Code (PBC) ratio tests.
Threshold 08/09 Position Comment Maximum Debt/Capital Ratio <15% 0.9% Achieved Minimum Dividend Cover >1 1.5 Achieved Minimum Interest Cover >3 81.6 Achieved Minimum Debt Service Cover >2 6.0 Achieved Maximum Debt Service Cover <3% 0.9% Achieved
When authorised as a Foundation Trust the PBL was set as:
Maximum cumulative long term borrowing: £26.2 million, and Approved working capital (bank overdraft) facility: not to exceed £11.5 million
The Trust has a working capital loan of £1.5 million at the March 31 2009, which is due to be repaid in full by March 31 2010.
Annual Report & Accounts 2008/2009 - 87 - Disclosures
Relevant Audit Information
a) So far as the Directors are aware, there is no relevant audit information of which the FT’s auditor is unaware, and
b) They have taken all the steps that ought to have been taken to make him aware of any relevant audit information and to establish that the FT’s auditor is aware of that information.
Public Donations and Expenditure
Royal Bolton Hospital NHS Foundation Trust has not made any political donations in 2008/09 nor incurred any political expenditure in the period from October 1 2008 to March 31 2009.
Charitable Donations
Royal Bolton Hospital NHS Foundation Trust has not given any money for charitable purposes in 2008/09 in the period from October 1 2008 to March 31 2009.
Financial Instruments
Royal Bolton Hospital NHS Foundation Trust held £10,817k in financial assets (cash balance and debtors) and £8,615k (working capital loan and outstanding pay award) in financial liabilities at March 31 2009. For more information see notes 24.0 – 24.5 of the accounts.
Policy and Practice on Payment of Creditors
In line with other public sector bodies, NHS organisations are required to pay invoices within 30 days or within the agreed payment terms, whichever is the sooner. This is known as the Better Payment Practice Code. NHS trusts are required to ensure that at least 95% of invoices are dealt with in line with this code.
Royal Bolton Hospital NHS Foundation Trust achieved 82% for non-NHS invoices and 89% for NHS invoices. Efforts continue to achieve the target.
6 Months to 31st March 2009 Number £000 Total non-NHS trade invoices paid in the period 16,672 19,920 Total non-NHS trade invoices paid within target 13,746 16,288 Percentage of non-NHS trade invoices paid within target 82% 82%
Total NHS trade invoices paid in the period 891 8,388 Total NHS trade invoices paid within target 659 7,491 Percentage of NHS trade invoices paid within target 74% 89%
Annual Report & Accounts 2008/2009 - 88 -
Going Concern
After making enquiries, the Directors have a reasonable expectation that Royal Bolton Hospital NHS Foundation Trust has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the accounts.
Private Patient Cap
Private patient income is capped at 0.1% of patient income as per our terms of authorisation. For the six months ended March 31 2009, private patient income was within this cap at £80k (0.1%).
Counter Fraud
Royal Bolton Hospital NHS Foundation Trust has a Fraud and Corruption policy. The Foundation Trust has a nominated, professional trained Local Counter Fraud Specialist (LCFS). The LCFS combines both proactive and investigative work to deliver an effective counter fraud service for the Trust. This includes:
Creating an anti-fraud culture Acting as a deterrent Prevention Detection Investigation Sanctions Redress
Additional Information in Support of Accounts
Royal Bolton Hospital NHS Foundation Trust has complied with the cost allocation and charging requirements set out in HM Treasury and Office of Public Sector Information Guidance.
Asset Valuations
The District Valuer undertook an asset valuation for land and buildings in 2008 as at the valuation date of 1 October on behalf of Royal Bolton Hospital NHS Foundation. The revaluation undertaken at that date was accounted for on 30 September 2008. The Trust does not consider asset values to have changed materially since the valuation date.
Annual Report & Accounts 2008/2009 - 89 - Charitable Funding
In common with most NHS trusts, Royal Bolton Hospital NHS Foundation Trust also administers charitable funds, registered charity no. 1050488. The funds are held separately from NHS funds and are used to purchase medical equipment, to improve patient and staff amenities and for education and training.
Capital Investments
During the six months to March 31 2009 we have spent £5,243k on capital investment. Below is a summary of the main items of capital expenditure.
Six months ended March 31, 2009
31 March 2009 £ '000 Maternity (Making It Better) 439 Clinical Equipment 123 New Digital X-Ray 930 Digital Breast Screening 203 Information Technology 47 Catheter Pacing/Catheter Lab 151 Energy Saving Measures 153 Relocate Health Records 1,330 Fire Precautions 366 Backlog Maintenance 283 Other capital 1,218 Total 5,243
Annual Report & Accounts 2008/2009 - 90 -
ACCOUNTS
Annual Report & Accounts 2008/2009 - 91 -
Royal Bolton Hospital NHS Foundation Trust Annual Accounts
6 Months to 31st March 2009
FOREWORD TO THE ACCOUNTS
ROYAL BOLTON HOSPITAL NHS FOUNDATION TRUST
These accounts for the six month period ended 31 March 2009 have been prepared by the Royal Bolton Hospital NHS Foundation Trust under schedule 7 sections 24 and 25 of the National Health Service Act 2006.
The Royal Bolton Hospital NHS Foundation Trust came into being on 1st October 2008 after being granted foundation trust status by Monitor. Consequently, this is the first set of accounts for Royal Bolton Hospital NHS Foundation Trust and there are no comparative figures.
Signed D Fillingham Chief Executive
Date 8th June 2009
Annual Report & Accounts 2008/2009 - 92 -
INCOME AND EXPENDITURE ACCOUNT FOR THE PERIOD ENDED 31 March 2009
6 Months to 31st March 2009 NOTE £000
Income from activities 3 80,475
Other operating income 4 12,794
Operating expenses 5-6 (91,290)
OPERATING SURPLUS 1,979
Profit/(loss) on disposal of fixed assets 0
SURPLUS/(DEFICIT) BEFORE INTEREST 1,979
Finance income 110 Finance costs - interest expense (60) Other finance costs (1)
SURPLUS/(DEFICIT) BEFORE TAXATION 2,028 Taxation Minority interest SURPLUS/(DEFICIT) AFTER TAXATION AND MINORITY INTEREST 2,028 PDC dividends payable (3,505) RETAINED SURPLUS/(DEFICIT) FOR THE PERIOD (1,477)
The notes on pages 95 to 123 form part of these accounts. All income and expenditure is derived from continuing operations.
Annual Report & Accounts 2008/2009 - 93 -
BALANCE SHEET AS AT 31 MARCH 2009 31 March 1 October 2008 2009
NOTE £000 £000 FIXED ASSETS
Intangible assets 10 944 1,064 Tangible assets 11 147,827 145,144 TOTAL FIXED ASSETS 148,771 146,208
CURRENT ASSETS
Stocks and work in progress 12 951 1,038 Debtors 13 7,874 9,691 Cash at bank and in hand 18.3 5,559 7,421 TOTAL CURRENT ASSETS 14,384 18,150
CREDITORS: Amounts falling due within one year 14.1 (11,587) (11,073)
NET CURRENT ASSETS/(LIABILITIES) 2,797 7,077
TOTAL ASSETS LESS CURRENT LIABILITIES 151,568 153,285
CREDITORS: Amounts falling due after more than one year 0 (750)
PROVISIONS FOR LIABILITIES AND CHARGES 16 (1,386) (957) TOTAL ASSETS EMPLOYED 150,182 151,578
FINANCED BY: TAXPAYERS' EQUITY Public dividend capital 22 84,791 84,791 Revaluation reserve 17 46,624 46,630 Donated asset reserve 17 1,051 970 Income and expenditure reserve 17 17,716 19,187
TOTAL TAXPAYERS' EQUITY 150,182 151,578
The financial statements on pages 1 to 4 were approved by the Board on 5 June 2009 and signed on its behalf by:
Signed: (Chief Executive) Date: 8th June 2009
Annual Report & Accounts 2008/2009 - 94 -
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE PERIOD ENDED 31 March 2009
6 Months to 31st March 2009 £000
Surplus/(deficit) for the financial period before dividend payments 2,028
Increases in the donated asset and government grant reserve due to receipt of donated and government grant financed assets 143
Reduction in the donated asset reserve due to depreciation, impairment, (62) and/or disposal of donated assets
Other recognised gains and losses 0
Total recognised gains and losses for the financial period 2,109
Prior period adjustment 0
Total gains and losses recognised in the financial period 2,109
Annual Report & Accounts 2008/2009 - 95 -
CASH FLOW STATEMENT FOR THE PERIOD ENDED 31 March 2009
6 Months to 31st March 2009 NOTE £000 OPERATING ACTIVITIES NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES 18.1 6,833
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE: Interest received 110 Interest paid (60) NET CASH INFLOW/(OUTFLOW) FROM RETURNS ON 50 INVESTMENTS AND SERVICING OF FINANCE
TAXATION PAID / RECEIVED 0
CAPITAL EXPENDITURE: (Payments) to acquire tangible fixed assets (4,483) (Payments) to acquire intangible fixed assets (7) NET CASH INFLOW/(OUTFLOW) FROM CAPITAL EXPENDITURE (4,490)
DIVIDENDS PAID (3,505)
NET CASH INFLOW/(OUTFLOW) BEFORE MANAGEMENT OF LIQUID RESOURCES AND FINANCING (1,112)
MANAGEMENT OF LIQUID RESOURCES: (Purchase) of current asset investments 0 Sale of current asset investments 0 NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING (1,112)
FINANCING: Other loans repaid (750) NET CASH INFLOW/(OUTFLOW) FROM FINANCING (750)
INCREASE/(DECREASE) IN CASH (1,862)
Annual Report & Accounts 2008/2009 - 96 - NOTES TO THE ACCOUNTS
1 ACCOUNTING POLICIES Monitor has directed that the financial statements of NHS foundation trusts shall meet the accounting requirements of the NHS Foundation Trust Financial Reporting Manual which shall be agreed with HM Treasury. Consequently, the following financial statements have been prepared in accordance with the 2008/09 NHS Foundation Trust Financial Reporting Manual issued by Monitor. The accounting policies contained in that manual follow UK generally accepted accounting practice for companies (UK GAAP) and HM Treasury’s Financial Reporting Manual to the extent that they are meaningful and appropriate to NHS foundation trusts. The accounting policies have been applied consistently in dealing with items considered material in relation to the accounts.
1.1 Accounting convention These accounts have been prepared under the historical cost convention modified to account for the revaluation of fixed assets at their value to the business by reference to their current costs. NHS Foundation Trusts are not required to provide a reconciliation between current cost and historical cost surpluses and deficits.
1.2 Income Recognition Income is accounted for applying the accruals convention. The main source of income for the Foundation Trust is from commissioners in respect of healthcare services provided under local agreements. Income is recognised in the period in which services are provided. Where income is received for a specific activity which is to be delivered in the following financial year, that income is deferred. The NHS Foundation Trust had contracts with NHS commissioners which followed the Department of Health's Payment by Results methodology in 2008/09 Under Application Note G of FRS 5 and UITF 40 the Foundation Trust is entitled to recognise income for partially completed spells of activity at the 31st March 2009. As the individual National Tariff price and procedure code is not known for partially completed spells the Foundation Trust has based its calculation of such income based on the average length of stay and the cumulative activity and price of individual specialities.
1.3 Expenditure Expenditure is accounted for applying the accruals convention.
1.4 Intangible fixed assets Intangible assets are capitalised when they are capable of being used in the Foundation Trust's activities for more than one year; they can be valued; and they have a cost of at least £5,000. Intangible fixed assets held for operational use are valued at historical cost and are depreciated over the estimated life of the asset on a straight line basis, except capitalised Research and Development which is revalued using an appropriate index
Annual Report & Accounts 2008/2009 - 97 - figure. The carrying value of intangible assets is reviewed for impairment at the end of the first full year following acquisition and in other periods if events or changes in circumstances indicate the carrying value may not be recoverable. Purchased computer software licences are capitalised as intangible fixed assets where expenditure of at least £5,000 is incurred. They are amortised over the shorter of the term of the licence and their useful economic lives.
1.5 Tangible fixed assets Capitalisation Borrowing costs associated with the construction of new assets are not capitalised. Tangible assets are capitalised if they are capable of being used for a period which exceeds one year and they: individually have a cost of at least £5,000; or collectively have a cost of at least £5,000 and individually have a cost of more than £250, where the assets are functionally interdependent, they had broadly simultaneous purchase dates, are anticipated to have simultaneous disposal dates and are under single managerial control; or form part of the initial equipping and setting-up cost of a new building, ward or unit irrespective of their individual or collective cost. Valuation Tangible fixed assets are stated at the lower of replacement cost and recoverable amount. On initial recognition they are measured at cost (for leased assets, fair value) including any costs such as installation directly attributable to bringing them into working condition. They are restated to current value each year. The carrying values of tangible fixed assets are reviewed for impairment in periods if events or changes in circumstances indicate the carrying value may not be recoverable. All land and buildings are revalued using professional valuations in accordance with FRS 15 every five years. A three yearly interim valuation is also carried out. Valuations are carried out by professionally qualified valuers in accordance with the Royal Institute of Chartered Surveyors (RICS) Appraisal and Valuation Manual. The last asset valuations were undertaken in 2008 as at the valuation date of 1 October 2008. The revaluation undertaken at that date was accounted for on 30 September 2008. The valuations are carried out primarily on the basis of Depreciated Replacement Cost for specialised operational property and Existing Use Value for non-specialised operational property. The value of land for existing use purposes is assessed at Existing Use Value. For non-operational properties including surplus land, the valuations are carried out at Open Market Value. In line with Treasury guidance, the revaluation on 1 October 2008 was based on “modern equivalent assets” rather than the “like for like” replacement basis used in previous valuations”. Assets in the course of construction are valued at current cost. These assets include any existing land or buildings under the control of a contractor. Operational equipment is carried at current value. Where assets are of low value, and/or have short useful economic lives, these are carried at depreciated historic cost as a proxy for current value. Equipment surplus to requirements is valued at net recoverable amount.
Annual Report & Accounts 2008/2009 - 98 - Depreciation, amortisation and impairments Tangible fixed assets are depreciated at rates calculated to write them down to estimated residual value on a straight-line basis over their estimated useful lives. No depreciation is provided on freehold land and assets surplus to requirements. Assets in the course of construction and residual interests in off-balance sheet PFI contract assets are not depreciated until the asset is brought into use or reverts to the Foundation Trust, respectively. Buildings, installations and fittings are depreciated on their current value over the estimated remaining life of the asset as advised by the District Valuer. Leaseholds are depreciated over the primary lease term. Gains arising from revaluations are taken to the Revaluation Reserve. Losses arising from revaluation are recognised as impairments and are charged to the revaluation reserve to the extent that a balance exists in relation to the revalued asset. Losses in excess of that amount are charged to the current year’s Income & Expenditure account, unless it can be demonstrated that the recoverable amount is greater than the revalued amount in which case the impairment is taken to the revaluation reserve. Diminutions in value when newly constructed assets are brought into use are charged in full to the Income & Expenditure account. These falls in value result from the adoption of ideal conditions as the basis for depreciated replacement cost valuations. Where the useful economic life of an asset is reduced from that initially estimated due to the revaluation of an asset for sale, depreciation is charged to bring the value of the asset to its value at the point of sale Fixed assets are depreciated on current cost evenly over the estimated life of the asset using the following lives: Buildings 5 to 79 years Dwellings 5 to 40 years Plant and Machinery - 4 to 15 years Transport 7 years Information Technology 5 to 15 years Furniture and Fittings 10 years
1.6 Donated fixed assets Donated fixed assets are capitalised at their current value on receipt and this value is credited to the Donated Asset Reserve. Donated fixed assets are valued and depreciated as described above for purchased assets. Gains and losses on revaluations are also taken to the Donated Asset Reserve and, each year, an amount equal to the depreciation charge on the asset is released from the Donated Asset Reserve to the Income and Expenditure account. Similarly, any impairment on donated assets charged to the Income and Expenditure Account is matched by a transfer from the Donated Asset Reserve. On sale of donated assets, the value of the sale proceeds is transferred from the Donated Asset Reserve to the Income and Expenditure Reserve.
Annual Report & Accounts 2008/2009 - 99 - 1.7 Liquid Resources Deposits and other investments that are readily convertible into known amounts of cash at or close to their carrying amounts are treated as liquid resources in the cashflow statement. The Foundation Trust does not hold any investments with maturity dates exceeding one year from the date of purchase.
1.8 Private Finance Initiative (PFI) transactions The NHS follows HM Treasury's Technical Note 1 (Revised) "How to Account for PFI transactions" which provides practical guidance for the application of the Application Note F to FRS 5 and the guidance 'Land and Buildings in PFI schemes Version 2'. Where the balance of the risks and rewards of ownership of the PFI property are borne by the PFI operator, the PFI obligations are recorded as an operating expense. Where the trust has contributed assets, a prepayment for their fair value is recognised and amortised over the life of the PFI contract by charge to the Income and Expenditure Account. Where, at the end of the PFI contract, a property reverts to the Foundation Trust, the difference between the expected fair value of the residual on reversion and any agreed payment on reversion is built up over the life of the contract by capitalising part of the unitary charge each year, as a tangible fixed asset. Where the balance of risks and rewards of ownership of the PFI property are borne by the Foundation Trust, it is recognised as a fixed asset along with the liability to pay for it which is accounted for as a finance lease. Contract payments are apportioned between an imputed finance lease charge and a service charge.
1.9 Stocks and work-in-progress Stocks and work-in-progress are valued at the lower of cost and net realisable value. This is considered to be a reasonable approximation to current cost due to the high turnover of stocks. Work-in-progress comprises goods in intermediate stages of production. Partially completed contracts for patient services are not accounted for as work-in-progress.
1.10 Research and development Expenditure on research is not capitalised. No expenditure on development has been capitalised in the period.
1.11 Cash, bank and overdraft Cash, bank and overdraft balances are recorded at the current values of these balances in the NHS Foundation Trust’s cash book. These balances exclude monies held in the NHS Foundation Trust’s bank account belonging to patients (see “third party assets” below). Account balances are only set off where a formal agreement has been made with the bank to do so. In all other cases overdrafts are disclosed within creditors. Interest earned on bank accounts and interest charged on overdrafts is recorded as, respectively, “interest receivable” and “interest payable” in the periods to which they relate. Bank charges are recorded as operating expenditure in the periods to which they relate.
Annual Report & Accounts 2008/2009 - 100 - 1.12 Provisions The Foundation Trust provides for legal or constructive obligations that are of uncertain timing or amount at the balance sheet date on the basis of the best estimate of the expenditure required to settle the obligation. Where the effect of the time value of money is material, the estimated risk-adjusted cash flows are discounted using the Treasury's discount rate of 2.2% in real terms. Clinical negligence costs The NHS Litigation Authority (NHSLA) operates a risk pooling scheme under which the NHS Foundation Trust pays an annual contribution to the NHSLA which in return settles all clinical negligence claims. Although the NHSLA is administratively responsible for all clinical negligence cases the legal liability remains with the Trust. The total value of clinical negligence provisions carried by the NHSLA on behalf of the Trust is disclosed at note 16. Since financial responsibility for clinical negligence cases transferred to the NHSLA at 1 April 2002, the only charge to operating expenditure in relation to clinical negligence in 2008/09 relates to the Foundation Trust's contribution to the Clinical Negligence Scheme for Trusts. Non-clinical risk pooling The Trust participates in the Property Expenses Scheme and the Liabilities to Third Parties Scheme. Both are risk pooling schemes under which the Foundation Trust pays an annual contribution to the NHS Litigation Authority and, in return, receives assistance with the costs of claims arising. The annual membership contributions, and any 'excesses' payable in respect of particular claims are charged to operating expenses as and when they become due.
1.13 Contingent Liabilities Contingent liabilities are provided for where a transfer of economic benefits is probable. Otherwise, they are not recognised, but are disclosed in note 21 unless the probability of a transfer of economic benefits is remote. Contingent liabilities are defined as: Possible obligations arising from past events whose existence will be confirmed only by the occurrence of one or more uncertain future events not wholly within the entity’s control; or
Present obligations arising from past events but for which it is not probable that a transfer of economic benefits will arise or for which the amount of the obligation cannot be measured with sufficient reliability.
1.14 Pension costs Past and present employees are covered by the provisions of the NHS Pensions Scheme. Details of the benefits payable under these provisions can be found on the NHS Pensions website at www.nhsbsa.nhs.uk/pensions. The Scheme is an unfunded, defined benefit scheme that covers NHS employers, General Practices and other bodies, allowed under the direction of the Secretary of State, in England and Wales. The scheme is not designed to be run in a way that would enable NHS bodies to identify their share of the underlying Scheme assets and liabilities. Therefore, the Scheme is accounted for as if it were a defined contribution scheme:
Annual Report & Accounts 2008/2009 - 101 - the cost to the NHS body of participating in the Scheme is taken as equal to the contributions payable to the Scheme for the accounting period. The Scheme is subject to a full actuarial valuation every four years (until 2004, based on a five year valuation cycle), and a FRS17 accounting valuation every year. An outline of these follows: a) Full actuarial (funding) valuation The purpose of this valuation is to assess the level of liability in respect of the benefits due under the scheme (taking into account its recent demographic experience), and to recommend the contribution rates to be paid by employers and scheme members. The last such valuation, which determined current contribution rates was undertaken as at 31 March 2004 and covered the period from 1 April 1999 to that date. The conclusion from the 2004 valuation was that the Scheme had accumulated a notional deficit of £3.3 billion against the notional assets as at 31 March 2004. However, after taking into account the changes in the benefit and contribution structure effective from 1 April 2008, the Scheme actuary reported that employer contributions could continue at the existing rate of 14% of pensionable pay. On advice from the Scheme actuary, scheme contributions may be varied from time to time to reflect changes in the scheme’s liabilities. Up to 31 March 2008, the vast majority of employees paid contributions at the rate of 6% of pensionable pay. From 1 April 2008, employees contributions are on a tiered scale from 5% up to 8.5% of their pensionable pay depending on total earnings. b) FRS17 Accounting valuation In accordance with FRS17, a valuation of the Scheme liability is carried out annually by the Scheme Actuary as at the balance sheet date by updating the results of the full actuarial valuation. Between the full actuarial valuations at a two-year midpoint, a full and detailed member data-set is provided to the Scheme Actuary. At this point the assumptions regarding the composition of the Scheme membership are updated to allow the Scheme liability to be valued. The valuation of the Scheme liability as at 31 March 2009, is based on detailed membership data as at 31 March 2006 (the latest midpoint) updated to 31 March 2009 with summary global member and accounting data. The latest assessment of the liabilities of the Scheme is contained in the Scheme Actuary report, which forms part of the annual NHS Pension Scheme (England and Wales) Resource Account, published annually. These accounts can be viewed on the NHS Pensions website. Copies can also be obtained from The Stationery Office. Scheme Provisions as at 31 March 2009 The scheme is a 'final salary' scheme. For early retirements other than those due to ill health the additional pension liabilities are not funded by the scheme. The full amount of the liability for the additional costs is charged to the income and expenditure account at the time the Foundation Trust commits itself to the retirement, regardless of the method of payment. The Scheme provides the opportunity to members to increase their benefits through money purchase Additional Voluntary Contributions (AVCs) provided by an approved panel of life companies. Under the arrangement the employee/member can make contributions to enhance an employee's pension benefits. The benefits payable
Annual Report & Accounts 2008/2009 - 102 - relate directly to the value of the investments made. From 1 April 2008 a voluntary additional pension facility becomes available, under which members may purchase up to £5,000 per annum of additional pension at a cost determined by the actuary from time-to-time. Early payment of a pension is available to members of the Scheme who are permanently incapable of fulfilling their duties effectively through illness or infirmity. A death gratuity of twice final year’s pensionable pay for death in service, and five times their annual pension for death after retirement, less pension already paid, subject to a maximum amount equal to twice the member’s final year’s pensionable pay less their retirement lump sum for those who die after retirement, is payable. Existing members at 1 April 2008 Annual pensions are normally based on 1/80th of the best of the last 3 years pensionable pay for each year of service. A lump sum normally equivalent to 3 years pension is payable on retirement. From 1 April 2008 there is the opportunity of giving up some of the pension to increase the retirement lump sum. Annual increases are applied to pension payments at rates defined by the Pensions (Increase) Act 1971, and are based on changes in retail prices in the twelve months ending 30 September in the previous calendar year. On death, a pension of 50% of the member’s pension is normally payable to the surviving spouse or eligible unmarried partner. New entrants from 1 April 2008 Annual pensions for new entrants from 1 April 2008 will be based on 1/60th of the best three-year average of pensionable earnings in the ten years before retirement. Members wishing to obtain a retirement lump sum may give up some of this pension to obtain a retirement lump of up to 25% of the total value of their retirement benefits. Survivor pensions will be available to married and unmarried partners and will be equal to 37.5% of the member's pension.
1.15 Value Added Tax Most of the activities of the Foundation Trust are outside the scope of VAT and, in general, output tax does not apply and input tax on purchases is not recoverable. Irrecoverable VAT is charged to the relevant expenditure category or included in the capitalised purchase cost of fixed assets. Where output tax is charged or input VAT is recoverable, the amounts are stated net of VAT.
1.16 Foreign Exchange Transactions that are denominated in a foreign currency are translated into sterling at the exchange rate ruling on the dates of the transactions. Resulting exchange gains and losses are taken to the Income and Expenditure Account.
1.17 Third Party Assets Assets belonging to third parties (such as money held on behalf of patients) are not recognised in the accounts since the Foundation Trust has no beneficial interest in them. Details of third party assets are given in Note 25 to the accounts.
Annual Report & Accounts 2008/2009 - 103 -
1.18 Corporation Tax Royal Bolton Hospital NHS Foundation Trust is regarded as a Health Service body within the meaning of the Income and Corporation Tax Act (ICTA) 1988 and accordingly is exempt from taxation on its income and capital gains within categories covered by this. There is a power for the Treasury to disapply this exemption in relation to the specified activities of a Foundation Trust. Accordingly Royal Bolton NHS Foundation Trust is potentially within the scope of Corporation Tax in respect of activities which are not related to, or ancillary to, the provision of healthcare and where the profits there from exceed £50,000 pa There is no corporation tax liability for this financial period.
1.19 Leases Where substantially all risks and rewards of ownership of a leased asset are borne by the Foundation Trust, the asset is recorded as a tangible fixed asset and a debt is recorded to the lessor of the minimum lease payments discounted by the interest rate implicit in the lease. The interest element of the finance lease payment is charged to the Income and Expenditure Account over the period of the lease at a constant rate in relation to the balance outstanding. Other leases are regarded as operating leases and the rentals are charged to the Income and Expenditure Account on a straight-line basis over the term of the lease. The asset and liability are recognised at the inception of the lease, and are de- recognised when the liability is discharged, cancelled or expires. During the period the Foundation Trust had no finance leases.
1.20 Public Dividend Capital (PDC) and PDC Dividend Public dividend capital (PDC) is a type of public sector equity finance based on the excess of assets over liabilities at the time of establishment of the original NHS trust. A charge, reflecting the forecast cost of capital utilised by the NHS Foundation Trust, is paid over as public dividend capital dividend. The charge is calculated at the real rate set by HM Treasury (currently 3.5%) on the average relevant net assets of the NHS Foundation Trust. Relevant net assets are calculated as the value of all assets less the value of all liabilities, except for donated assets and cash held with the Office of the Paymaster General. Average relevant net assets are calculated as a simple mean of opening and closing relevant net assets.
1.21 Losses and Special Payments Losses and Special Payments are items that Parliament would not have contemplated when it agreed funds for the health service or passed legislation. By their nature they are items that ideally should not arise. They are therefore subject to special control procedures compared with the generality of payments. They are divided into different categories, which govern the way each individual case is handled. Losses and Special Payments are charged to the relevant functional headings in the Income and Expenditure Account on an accruals basis, including losses which would have been made good through insurance cover had NHS Trusts not been bearing
Annual Report & Accounts 2008/2009 - 104 - their own risks (with insurance premiums then being included as normal revenue expenditure).
1.22 Financial Instruments Financial assets Financial assets are recognised on the balance sheet when the Foundation Trust becomes party to the financial instrument contract or, in the case of trade receivables, when the goods or services have been delivered. Financial assets are derecognised when the contractual rights have expired or the asset has been transferred. Financial assets are initially recognised at fair value. Financial assets are classified into the following categories: financial assets ‘at fair value through profit and loss’; ‘held to maturity investments’; ‘available for sale’ financial assets, and ‘loans and receivables’. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Financial assets at fair value through profit and loss Embedded derivatives that have different risks and characteristics to their host contracts, and contracts with embedded derivatives whose separate value cannot be ascertained, are treated as financial assets at fair value through profit and loss. They are held at fair value, with any resultant gain or loss recognised in the income statement. The net gain or loss incorporates any interest earned on the financial asset. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments which are not quoted in an active market. After initial recognition, they are measured at amortised cost using the effective interest method, less any impairment. Interest is recognised using the effective interest method. Fair value is determined by reference to quoted market prices where possible, otherwise by valuation techniques. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, to the net carrying amount of the financial asset. At the balance sheet date, the Foundation Trust assesses whether any financial assets, other than those held at ‘fair value through profit and loss’ are impaired. Financial assets are impaired and impairment losses recognised if there is objective evidence of impairment as a result of one or more events which occurred after the initial recognition of the asset and which has an impact on the estimated future cash flows of the asset. For financial assets carried at amortised cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the revised future cash flows discounted at the asset’s original effective interest rate. The loss is recognised in the income statement and the carrying amount of the asset is reduced directly, or through a provision for impairment of receivables. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the
Annual Report & Accounts 2008/2009 - 105 - impairment was recognised, the previously recognised impairment loss is reversed through the income statement to the extent that the carrying amount of the receivable at the date of the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.
Financial liabilities Financial liabilities are recognised on the balance sheet when the Foundation Trust becomes party to the contractual provisions of the financial instrument or, in the case of trade payables, when the goods or services have been received. Financial liabilities are de-recognised when the liability has been discharged, that is, the liability has been paid or has expired. Financial liabilities are initially recognised at fair value. Financial liabilities are classified as either financial liabilities ‘at fair value through profit and loss’ or other financial liabilities.
Financial liabilities at fair value through profit and loss Embedded derivatives that have different risks and characteristics to their host contracts, and contracts with embedded derivatives whose separate value cannot be ascertained, are treated as financial liabilities at fair value through profit and loss. They are held at fair value, with any resultant gain or loss recognised in the income statement. The net gain or loss incorporates any interest earned on the financial asset. Other financial liabilities After initial recognition, all other financial liabilities are measured at amortised cost using the effective interest method. The effective interest rate is the rate that exactly discounts estimated future cash payments through the life of the asset, to the net carrying amount of the financial liability. Interest is recognised using the effective interest method.
Annual Report & Accounts 2008/2009 - 106 -
2 SEGMENTAL ANALYSIS
All activity at Royal Bolton Hospital NHS Foundation Trust is healthcare related. The Foundation Trust does not act as a lead body for a consortium and consequently there is no need to report performance segmentally.
3.1a Income from Activities - by point of delivery 6 Months to 31st March 2009 £000
Elective income 15,001 Non elective income 33,243 Outpatient income 13,769 A & E income 4,207 Other NHS clinical income 13,522 Total Income at full tariff 79,742 PBR clawback 0 Income from Activities 79,742 Private patients 80 Other non protected clinical income 653 Total income from activities 80,475
6 Months to 31st March 3.1b Income from Activities - by source 2009 £000
NHS Foundation Trusts 89 NHS Trusts 105 Primary Care Trusts 75,547 Department of Health - other 3,955 Non NHS: Private patients 65 Non-NHS: Overseas patients (non- reciprocal) 15 NHS injury scheme (was RTA) 653 Non NHS: Other 46 80,475
Annual Report & Accounts 2008/2009 - 107 -
3 Private Patient Income Section 44 of the 2006 Act requires that the proportion of private patient income to the total patient related income of NHS foundation trusts should not exceed its proportion whilst the body was an NHS Trust in 2002/03 (the Private Patient Cap).
2002/03 6 Months to 31st (Base March 2009 Year) £000 £000 Private patient income 80 126 Total patient related income 80,475 118,421 Proportion as a percentage 0.1% 0.1%
4 Other Operating Income
6 Months to 31st March 2009 £000
Education and training 3,734 Charitable and other contributions to expenditure 108 Transfers from the donated asset reserve in respect of depreciation, impairment and disposal of donated assets 62 Non-patient care services to other bodies 4,331 Other income 4,559 12,794
Other income includes: Car parking 432 Estates recharges 76 Staff recharges 758 Drugs recharge 1,323 Staff accommodation rentals 40 Catering 696 Property rentals 97 Other 1,137 4,559
Annual Report & Accounts 2008/2009 - 108 -
5 Operating Expenses
5.1 Operating expenses comprise:
6 Months to 31st March 2009 £000
Services from NHS Foundation Trusts 647 Services from NHS Trusts 340 Services from other NHS Bodies 591 Purchase of healthcare from non NHS bodies 3 Executive directors costs 370 Non-executive directors costs 40 Staff costs 63,942 Drug costs 4,748 Supplies and services - clinical (excluding drug costs) 7,623 Supplies and services - general 3,190 Establishment 651 Transport 196 Premises 4,058 Increase / (decrease) in bad debt provision 20 Other impairment of financial assets 0 Depreciation and amortisation 2,823 Audit fees - statutory audit 60 Other auditors remuneration 20 Clinical negligence premium 1,033 Other 935 91,290
Other expenditure includes: Legal fees 69 Consultancy costs 179 Training, courses and conferences 240 Patient travel 25 Insurance 11 Losses, ex gratia & special payments 68 Other 343 935
Annual Report & Accounts 2008/2009 - 109 -
5.2 Operating leases
5.2.1 Operating expenses include:
6 Months to 31st March 2009 £000
Hire of plant and machinery 357 Other operating lease rentals 0
357
5.2.2 Annual commitments under non - cancellable operating leases are:
Land and buildings Other leases
6 Months to 6 Months to 31st March 31st March 2009 2009 £000 £000
Operating leases which expire:
Within 1 year 0 24 Between 1 and 5 years 0 170 After 5 years 0 0
0 194
Annual Report & Accounts 2008/2009 - 110 -
6. Staff costs and numbers
6.1 Staff costs
6 Months to 31st March 2009 £000
Salaries and wages 53,421 Social Security Costs 3,629 Employer contributions to NHS Business Service Authority (Pension) 5,772 Other pension costs 2 Agency/contract staff 1,491
64,315
6.2 Average number of persons employed
6 Months to 31st March 2009
Number
Medical and dental 372 Administration and estates 736 Healthcare assistants and other support staff 632 Nursing, midwifery and health visiting staff 1,130 Scientific, therapeutic and technical staff 328 Bank and agency staff 217 Other 21
Total 3,436
6.3 Employee benefits
There are no employee benefits
6.4 Retirements due to ill-health
For the six months ended 31st March 2009 the number of early retirements were 4. The estimated additional pension liability for these 4 early retirements was £198,349 The cost of these ill-health retirements will be borne by the NHS Business Services Authority -Pensions Division.
Annual Report & Accounts 2008/2009 - 111 -
7 The Late Payment of Commercial Debts (Interest) Act 1998
During the period there were no claims for interest made against the Foundation Trust under the above legislation.
8. Profit / (Loss) on disposal of fixed assets
There were no profits or losses on disposal of fixed assets in the period.
9. Finance Costs & Interest receivable 6 Months to 31st March 2009 £000
Finance Costs Other interest and finance costs 60
TOTAL 60
Interest Receivable Bank accounts 110
TOTAL 110
Annual Report & Accounts 2008/2009 - 112 - 10. Intangible Fixed Assets
Software Licenses and Patents Development Total licences trademarks expenditure £000 £000 £000 £000 £000 Gross cost at 1 October 2008 1,280 1,280 Additions purchased 0 Additions donated 0 Disposals 0 Gross cost at 31 March 2009 1,280 0 0 0 1,280
Amortisation at 1 October 2008 216 216 Charged during the period 120 120 Disposals 0 Amortisation at 31 March 2009 336 0 0 0 336
Net book value - Purchased at 1 October 2008 1,064 1,064 - Donated at 1 October 2008 0 0 - Total at 1 October 2008 1,064 0 0 0 1,064
- Purchased at 31 March 2009 944 944 - Donated at 31 March 2009 0 0 - Total at 31 March 2009 944 0 0 0 944
Annual Report & Accounts 2008/2009 - 113 -
11. Tangible Fixed Assets
11.1 Tangible fixed assets at the balance sheet date comprise the following elements:
Land Buildings Dwellings Assets Plant and Transport Information Furniture Total excluding under machinery equipment technology & fittings dwellings construction
£000 £000 £000 £000 £000 £000 £000 £000 £000 Cost or valuation at 1 October 2008 26,248 111,116 1,675 1,148 16,543 112 4,627 408 161,877 Additions purchased 1,984 414 2,018 781 46 5,243 Additions donated 78 65 0 143 Reclassifications 775 (775) 0 Disposals (650) (650) Cost or Valuation at 31 March 2009 26,248 113,953 2,089 2,391 16,739 112 4,673 408 166,613
Depreciation at 1 October 2008 2,396 32 11,856 100 2,248 101 16,733 Charged during the period 1,860 36 528 2 257 20 2,703 Disposals (650) (650) Depreciation at 31 March 2009 0 4,256 68 0 11,734 102 2,505 121 18,786
Net book value - Purchased at 1 October 2008 26,248 108,148 1,643 1,148 4,289 12 2,379 307 144,174 - Donated at 1 October 2008 0 572 0 0 398 0 0 0 970 - Total at 1 October 2008 26,248 108,720 1,643 1,148 4,687 12 2,379 307 145,144
- Purchased at 31 March 2009 26,248 109,060 2,021 2,391 4,592 10 2,167 287 146,776 - Donated at 31 March 2009 0 637 0 0 413 0 1 0 1,051 - Total at 31 March 2009 26,248 109,697 2,021 2,391 5,005 10 2,168 287 147,827
Annual Report & Accounts 2008/2009 - 114 - 11.2 The net book value of land, buildings and dwellings at 31 March 2009 comprises:
31 March 2009 31 March 2009 31 March 2009 £000 £000 £000 Total Protected Unprotected Freehold 137,966 125,949 12,017 Long Leasehold 0 0 0 Short Leasehold 0 0 0
TOTAL 137,966 125,949 12,017
12 Stocks and Work in Progress 31 March 1 October 2009 2008 £000 £000
Raw materials and consumables 951 1,038
TOTAL 951 1,038
13 Debtors
13.1 Debtors at the balance sheet date are made up of: 31 March 1 October 2009 2008 £000 £000
Amounts falling due within one year:
NHS Debtors 1,979 4,105 Provision for impaired debtors (96) (98) Prepayments 1,340 2,158 Accrued income 1,709 0 Other debtors 1,887 2,531 Sub Total: falling due within one year 6,819 8,696
Amounts falling due after more than one year:
Provision for impaired debtors (82) (84) Other debtors 1,137 1,079 Sub Total: falling due after more than one year 1,055 995
TOTAL 7,874 9,691
Other Debtors include £0 prepaid pension contributions at 31 March 2009
Annual Report & Accounts 2008/2009 - 115 -
13.2 Provision for impairment of debtors 31 March 2009 £000 Balance at 1 October 2008 (182) (Increase)/decrease in debtors impaired 4
Balance at 31 March 2009 (178)
13.3 Debtors past due date but not impaired: 31 March 1 October 2009 2008 £000 £000 By up to 3 months 630 483 By 3 to 6 months 120 160 By more than 6 months 160 5
TOTAL 910 648
14. Creditors
14.1 Creditors at the balance sheet date are made up of: 1 October 31 March 2009 2008 £000 £000 Amounts falling due within one year:
Loans 1,500 1,500 NHS creditors 1,601 1,202 Other tax and social security costs 2,537 2,277 Capital Creditors 1,034 281 Other Creditors 4,769 5,684 Accruals 146 129 Sub Total: amounts falling due within one year 11,587 11,073
Amounts falling due after more than one year:
Long - term loans 0 750
Sub Total: amounts falling due in more than one year 0 750
TOTAL 11,587 11,823
Other creditors include; There are no payments due in future years under arrangements to buy out the liability of early retirements over 5 years; and
£1,445,295 outstanding pensions contributions at 31 March 2009. Pension contributions are paid a month in arrears. 14.2 Loans Department 31 March 1 October of Health Other 2009 2008
Annual Report & Accounts 2008/2009 - 116 - £000 £000 £000 £000 Amounts falling due: In one year or less 1,500 1,500 1,500 Between one and two years 0 750 Between two and five years 0 Over 5 years 0 TOTAL 1,500 0 1,500 2,250
Department 31 March 1 October of Health Other 2009 2008 £000 £000 £000 £000
Wholly repayable within five years 1,500 1,500 2,250 Wholly repayable after five years, not by instalments 0 0 Wholly or partially repayable after five years, by instalments 0 0 TOTAL 1,500 0 1,500 2,250
15 Prudential Borrowing Limit
The Foundation Trust has a prudential borrowing limit of £37,700k in 2008/09. The Foundation Trust actually repaid £750k in the six months to 31 March 2009 and at 31 March 2009 had £1,500k of outstanding borrowing Actual Ratios 6 Months to Approved Ratios 6 31 March 2009 Months to 31 March 2009 Maximum debt/capital ratio 0.9% <15% Minimum dividend cover 1.4 >1x
Minimum interest cover 81.6 >3x Minimum debt service cover 6.0 >2x Minimum debt service to revenue 0.9% <3%
The Foundation Trust has an actual committed working capital (bank overdraft) facility of £11,500k within its approved limit of £37,700k The Foundation Trust has not drawn down on its working capital facility at 31 March 2009. This facility expires on 30 September 2010. The Foundation Trust is required to comply and remain within a prudential borrowing limit. This is made up of two elements:
• the maximum cumulative amount of long-term borrowing. This is set by reference to the five ratio tests set out in Monitor’s Prudential Borrowing Code. The financial risk rating set under Monitor’s Compliance Framework determines one of the ratios and therefore can impact on the long term borrowing limit.
• the amount of any working capital facility approved by Monitor. Further information on the NHS Foundation Trust Prudential Borrowing Code and Compliance Framework can be found on the website of Monitor, the Independent Regulator of Foundation Trusts.
Annual Report & Accounts 2008/2009 - 117 - 16 Provisions for liabilities and charges Pensions Pensions Legal claims Restructurings Other Total relating to relating to former other staff directors £000 £000 £000 £000 £000 £000
At 1 October 2008 71 227 659 957 Arising during the period 0 0 572 572 Utilised during the period (1) (17) (126) (144) Unwinding of discount 0 1 0 1
At 31 March 2009 0 70 211 0 1,105 1,386
Expected timing of cashflows:
Within one year 2 113 1,105 1,220 Between one and five years 9 26 0 35 After five years 59 72 0 131
£9,366,917 is included in the provisions of the NHS Litigation Authority at 31 March 2009 in respect of clinical negligence liabilities of the NHS Foundation Trust .
Other relates to anticipated payments to non-medical staff following the revision of service contracts.
In January 2009 the Trust signed an agreement with the NHSLA that in the event of the Trust (i) choosing to leave the CNST voluntarily and (ii) in the event of insolvency, the Trust would be required to compensate the NHSLA for all continuing payments i.e. lump sum liability
Annual Report & Accounts 2008/2009 - 118 -
17.1 Movements on Reserves
Revaluation Donated Income and Reserve Asset Expenditure Movements on reserves in the period comprised the following: Reserve Reserve Total £000 £000 £000 £000
At 1 October 2008 46,630 970 19,187 66,787
Transfer from the income and expenditure account (1,477) (1,477)
Transfer of realised profits/(losses) to the income and expenditure reserve (6) 6 0
Receipt of donated/government granted assets 143 143
Transfers to the income and expenditure account for depreciation, (62) impairment, and disposal of donated/government granted assets (62)
At 31 March 2009 46,624 1,051 17,716 65,391
17.2 Movements in Taxpayers' Equity £ '000 Taxpayers' equity at 1 October 2008 151,578 Surplus/(deficit) for the financial year 2,028 Public dividend capital dividends (3,505) Additions/(reductions) in donated asset reserve 81 Taxpayers' equity at 31 March 2009 150,182
Annual Report & Accounts 2008/2009 - 119 - 18 Notes to the cash flow Statement
18.1 Reconciliation of operating surplus to net cash flow from operating activities:
6 Months to 31st March 2009 £000
Total operating surplus/(deficit) 1,979 Depreciation and amortisation 2,823 Transfer from the donated asset reserve (62) Other movements (4) (Increase)/decrease in stocks 87 (Increase)/decrease in debtors 1,817 Increase/(decrease) in creditors (236) Increase/(decrease) in provisions 429
Net cash inflow/(outflow) from operating activities before restructuring costs 6,833 Payments in respect of fundamental reorganisation/restructuring 0 Net cash inflow/(outflow) from operating activities 6,833
18.2 Reconciliation of net cash flow to movement in net debt
6 Months to 31st March 2009 £000
Increase/(decrease) in cash in the period (1,862) Cash outflow from debt repaid and finance lease capital payments 750 Change in net funds / (debt) resulting from cash flows (1,112) Non-cash changes in debt 0 Change in net funds / (debt) Net funds / (debt) at start of period for new FT's 5,171 Net funds / (debt) at 31 March 2009 4,059
Annual Report & Accounts 2008/2009 - 120 - 18.3 Analysis of changes in net debt
At 1 October 2008 Cash Transferred Other cash Non-cash At 31 March (to)/from other changes in changes in 2009 NHS bodies period period £000 £000 £000 £000 £000
Commercial cash at bank and in hand 248 (10) 238 OPG (Office of Paymaster General) cash at bank 7,173 (1,852) 5,321 Bank overdrafts 0 Debt due within one year (1,500) (1,500) Debt due after one year (750) 750 0
5,171 0 (1,112) 0 4,059
Annual Report & Accounts 2008/2009 - 121 - 19 Capital Commitments
Commitments under capital expenditure contracts at 31 March 2009 were £1,237,968
These commitments predominantly relate to two schemes:-
Health Records of £425k Cardiac Catheter Pacing of £519k
20 Post Balance Sheet Events
The Trust has a project group looking at the impact of IFRS which meets on a monthly basis. The Trust is on target to report under IFRS for the 2009/10 accounts.
21 Contingencies 31 March 1 October 2009 2008 £000 £000 Contingent liabilities (55) (71)
Net value of contingent liabilities (55) (71)
22 Movement in Public Dividend Capital 6 Months to 31st March 2009 £000
Public Dividend Capital as at 1 October 2008 84,791 New Public Dividend Capital received 0 Public Dividend Capital repaid in the period 0
Public Dividend Capital at 31 March 2009 84,791
Annual Report & Accounts 2008/2009 - - 122 - -
23 Related Party Transactions
Royal Bolton Hospital NHS Foundation Trust is a body corporate established by order of the Secretary of State for Health.
During the period none of the Board Members or members of the key management staff or parties related to them has undertaken any material transactions with Royal Bolton Hospital NHS Foundation Trust.
Payments Receipts Amounts Amounts to Related from owed to due from Party Related Related Related Party Party Party £ £ £ £ Bolton MBC - The Chairman of the Trust is Leader of the Council 439,190 116,670 855 20,156
The Department of Health is regarded as a related party. During the period Royal Bolton Hospital NHS Foundation Trust has had a significant number of material transactions with the Department, and with other entities for which the Department is regarded as the parent Department. These entities are listed below:
63,399,54 Bolton Primary Care Trust; 610,085 5 169,825 538,223 Ashton, Leigh & Wigan Primary Care Trust 2,260 7,202,074 88,961 Salford Primary Care Trust 4,823,963 338,872 Greater Manchester West Mental Health NHS Foundation Trust 67,238 1,782,130 10,592 200,223 Bury Primary Care Trust 9,807 2,330,863 8,012 70,817 North West Strategic Health Authority 37,722 3,853,930 35,015 17,432 National Blood Authority 606,370 13,768 NHS Blood & Transplant 41,150 NHS Litigation Authority 1,036,164 NHS Pensions Agency 5,771,527 2,190 Other Primary Care Trusts and NHS Trusts 5,243,574 2,506,110 1,238,153 1,919,258
In addition, the Trust has had a number of material transactions with other Government Departments and other central and local Government bodies. Most of these transactions have been with the NHS Pension Scheme and the National Insurance Fund in respect of employee contributions.
The Trust has received revenue and capital benefit from purchases made by Bolton Hospitals NHS Trust Charitable Funds. The transactions are summarised below. The separate Trustees Report and Accounts for Bolton Hospitals NHS Trust Charitable Funds are available on request.
Purchases made from Purchases made from Charitable Funds Charitable Funds relating relating to capital assets Revenue Payments to Capital Payments to to revenue items transferred to the Trust Charitable Funds Charitable Funds £ £ £ £ 107,809 142,730 - - 24 Financial Instruments
Annual Report & Accounts 2008/2009 - - 123 - - Financial Reporting Standard 29 requires disclosure of the role that financial instruments have had during the period in creating or changing the risks a body faces in undertaking its activities. Because of the continuing service provider relationship that the NHS Foundation Trust has with Primary Care Trusts and the way those Primary Care Trusts are financed, the NHS Foundation Trust is not exposed to the degree of financial risk faced by business entities. Also financial instruments play a much more limited role in creating or changing risk than would be typical of listed companies, to which these standards mainly apply. The NHS Foundation Trust has limited powers to borrow or invest surplus funds and financial assets and liabilities are generated by day-today operational activities rather than being held to change the risks facing the NHS Foundation Trust in undertaking its activities.
Royal Bolton Hospital NHS Foundation Trust has in place a Treasury Management Policy that covers the short-term investment of surplus operating cash. It provides a clearly defined risk management framework and was developed with reference to best practice guidance issued by Monitor, the Independent Regulator. This policy ensures the efficient management of liquidity and financial risk and is approved and overseen by the Foundation Trust's Finance Committee. Royal Bolton Hospital NHS Foundation Trust is, therefore, not exposed to significant liquidity risk.
Currency risk
The Foundation Trust is principally a domestic organisation with the great majority of transactions, assets and liabilities being in the UK and sterling based. The Foundation Trust has no overseas operations. The Foundation Trust therefore has low exposure to currency rate fluctuations.
Interest-rate risk
At 31 March 2009 the Foundation Trust's financial liabilities carried either nil or fixed rates of interest. The Foundation Trust's financial assets relate to loans and receivables and its cash balances held at 31 March 2009 within its Office of Paymaster General bank account or commercial current account. Interest on cash balances are set by the Office of the Paymaster General. Royal Bolton Hospital NHS Foundation Trust is not, therefore, exposed to significant interest-rate risk.
Credit risk
As above the Foundation Trust receives most of its income from its commissioners based on annual contracts adjusted quarterly. It operates a robust debt management policy and, where necessary, provides for the risk of particular debts not being discharged by the applicable party. Royal Bolton NHS Foundation Trust is, therefore, not exposed to significant credit risk.
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Liquidity risk
The Foundation Trust's operating costs are incurred under contract with Primary Care Trusts, which are financed from resources voted annually by Parliament. The Foundation Trust has in place a £11.5 million committed working capital (bank overdraft) facility with Royal Bank of Scotland to utilise, if required, for operational cashflow issues. The facility expires on 30 September 2010. Due to careful cashflow management the Foundation Trust has not drawn on its working capital facility since its authorisation as a Foundation Trust. The Foundation Trust funds its capital expenditure initially from internally generated funds. If further capital investment is required the Foundation Trust can borrow, up to its Prudential Borrowing Limit, from the Department of Health NHS Financing Facility. The Foundation Trust is not, therefore, exposed to significant liquidity risks.
24.1 Financial Assets
At the 31st March 2009 £5,559k of the Foundation Trust's financial assets were held at a floating rate.
24.2 Financial Liabilities
At the 31st March 2009 none of the Foundation Trust's financial liabilities are carried at a floating rate.
24.3 Financial Assets by category Total Loans and receivables £000 £000 Assets as per balance sheet NHS Debtors (net of provisions for irrecoverable debts) 1,801 1,801 Accrued Income 1,709 1,709 Other Debtors 1,748 1,748 Cash at bank and in hand 5,559 5,559 Total as at 31 March 2009 10,817 10,817
24.4 Financial Liabilities by category Total Other Financial Liabilities
Liabilities as per balance sheet Loans 1,500 1,500 NHS Creditors 1,601 1,601 Other Creditors 4,171 4,171 Accruals 146 146 Provisions under contract 1,197 1,197 Total as at 31 March 2009 8,615 8,615
24.5 Fair Values
Set out below is a comparison, by category, of book values and fair values of the NHS Foundation Trust's financial liabilities at 31 March 2009 as required by FRS 29.
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24.5b Financial Liabilities Book Value Fair Value £000 £000 At 31 March 2009 Provisions under contract 1,197 1,197 Loans 1,500 1,500 Gross financial liabilities 2,697 2,697
Notes a Fair value is not significantly different from book value since, in the calculation of book value, the expected cash flows have been discounted by the Treasury discount rate of 2.2% in real terms. b Loans from the Department of Health's NHS Foundation Trust Financing Facility where it is expected that book value will equal fair value
25 Third Party Assets
The Trust held £449 cash at bank and in hand at 31 March 2009 which relates to monies held by the NHS Foundation Trust on behalf of patients. This has been excluded from cash at bank and in hand figure reported in the accounts.
26 Losses and Special Payments
There were 41 cases of losses and special payments totalling £87,980 during 6 Months to 31st March 2009.
Annual Report & Accounts 2008/2009 - - 126 - - Annual Member’s Meeting
Our Annual Members Meeting will take place on September 22nd , 3pm at the Royal Bolton Hospital Education Centre.
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The report and other documents are also available at www.boltonhospitals.nhs.uk
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