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NHS Highland

Meeting: NHS Highland Board

Meeting date: 26th May 2020

Title: Opening Budget offer to Argyll and Bute 2020 /

2021

Responsible Executive/Non-Executive: David Garden

Report Author: David Garden

1 Purpose

This is presented to the Board for:

Decision

This report relates to a:

NHS Board/Integration Joint Board Strategy or Direction

This aligns to the following NHS Scotland quality ambition(s):

Effective

2 Report summary

2.1 Situation This report sets out the initial budget off for Argyll & Bute IJB.

2.2 Background Boards are required to offer IJBs budgets at the start of the financial year. This paper

sets out the basis of the offer and highlights a change to the previously agreed

methodology.

2.3 Assessment Details of the assessment are in the attached report. Of note is that this is the first time

that there has been deviation from an NRAC allocation. Whilst the difference is relatively

small at £100,000, it is important to recognise this is a change to previously agreed

practice.

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2.3.1 Quality/ Patient Care

n/a.

2.3.2 Workforce

n/a

2.3.3 Financial

This is part of the annual budget setting process for NHS Highland

2.3.4 Risk Assessment/Management

Risk management is part of the H&SCP’s management process in budgetary

management and control.

2.3.5 Equality and Diversity, including health inequalities

n/a

2.3.6 Other impacts

N/A

2.3.7 Communication, involvement, engagement and consultation

N/A

2.3.8 Route to the Meeting

Annual statutory requirement

2.4 Recommendation The Board is asked to approve the budget offer to Argyll & Bute IJB

3 List of appendices

The following appendices are included with this report:

Report

Opening Budget Offer to Argyll & Bute IJB 2020 / 2021 Report by David Garden, Director of Finance

The Board is asked to:

Approve the 2020/21 budget offer to the Argyll & Bute Integration Joint Board as set out in this paper.

Background

The Board is required to make an opening budget offer to the IJB in advance of the new financial year. The Director of Finance has been in dialogue with the IJB’s Chief Finance Officer (CFO) and an offer in principle has been made, subject to Board approval.

Context

Since its inception, the funding agreement with regards to Argyll & Bute has been that it should receive funding equal to its ‘fair share’ of the NHS Highland total. This is calculated using the same weighted population methodology that is used across NHS Scotland (the NRAC formula). Argyll & Bute’s NRAC share reduced slightly from 28.87% to 28.77% of the Highland total.

The guidance issued with Board allocations for 2020/21 indicated that “NHS payments to Integration Authorities for delegated health functions must deliver an uplift of at least 3% over 2019-20 agreed recurring budgets”

In previous years it was agreed that the integrity of the NRAC share would be maintained and this resulted in slight deviations from national guidance. However, for 2020/21 Argyll & Bute HSCP have requested a 3% uplift in line with national guidance. Whilst the difference is only £100,000, it is important to recognise that this is the first time that the IJB has moved away from an NRAC allocation of resource.

Draft Offer

The draft offer totals £227.1m and the table below sets out the detail of how this is calculated. It also includes an initial estimate of additional in year allocations and these will be subject to change and will be updated as the amounts are confirmed.

It should be noted that additional national funding in respect of Covid-19 mobilisation plans has yet to be advised to Boards and will be passed over directly when clarity is received.

Table 1 – Argyll & Bute IJB Opening Budget Offer

£m

Summary 2020/21 Total

Closing baseline 2019/20 182.7

Add superannuation funding 4.6

187.3

3% Uplift 5.6

Proposed Baseline Share 192.9

Estimates for additional In-Year Allocations

Expected Covid-19 Allocations TBC

Expected in year core allocations 22.4

Expected in year non core allocations 11.8

Proposed Draft Budget Offer 227.1

Contribution to Board Objectives

Contributes to the objective of meeting financial balance

Governance Implications

Complies with Scottish Government guidance

Risk Assessment

The key risks will need to be managed within the IJB

Planning for Fairness

The proposed offer will move both areas of NHS Highland to parity funding

Engagement & Communication

Regular dialogue between officers of the Board and the IJB. The proposed offer is recommended as a reasonable compromise.

David Garden, Director of Finance 13th May 2020