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Improving
Health Together
Annual report and accounts
2013/14
Annual Report and Accounts 2013/14
Overview ‐ Our First Year Dr Henry Waters Governing Body Chair Our first year as a CCG has been one of exciting opportunities but there have been some real challenges too in terms of health and the NHS both locally and nationally, but nonetheless this has been an extremely rewarding year. To have clinicians at the heart of all that we do coupled with talking often and listening to partners, patients and the public helps us stay focused on what matters most to local people and forges our role in helping improve people’s health and wellbeing. We’ve learned a lot this year from the feedback people have shared with us; we have had constructive feedback from patients, the public, partners and our own member practices. As we go forward into 2014/15 we will be ensuring we keep doing the things that people value and expect from us and importantly, work hard to improve where they have told us we could do better. We have performed well with regards to waiting times for cancer services, ambulance response times, and seven day follow up from discharge for people who use mental health services. However, we were not successful in reaching our ambition and performance measures relating to smoking in pregnancy. Furthermore, we had some cases of healthcare acquired infection at a local hospital. This is disappointing. In our next year we will work hard to improve in these areas, and maintain or exceed performance where we have achieved this year. From a financial perspective we delivered a 1% financial surplus at the end of our first year. We were also delighted to launch our Community Innovations Fund, investing an additional £200k in innovative, community based services for local people. These services included a home from hospital service, preventing relationship problems, resilience for young people 2 experiencing mental health problems, a volunteer scheme and an alcohol abstinence initiative. A full list of the successful projects can be found on our website www.southteesccg.nhs.uk We also expect to achieve most aspects of our quality premium, which rewards efforts to tackle key priorities and this has released funds for us to reinvest in health services. One of these priorities was to reduce the number of readmissions to hospital within 30 days of discharge as well as increase our diagnosis rates for people with dementia. Whilst there is much for us to do and continue to do as we enter into 2014/15, we have identified a number of key priorities:  engage more often, more widely and in different ways with a wider range of local people;  increase clinical engagement finding ways to enable more of our clinicians to influence local services;  make the most of our partnerships identifying new ways of working with a range of providers including the voluntary and community sector;  maintain our focus on quality across all services, as well as on improving community services and on prevention. Dr Henry Waters Governing Body Chair for NHS South Tees CCG 6 June 2014
Front Cover Photograph
NHS South Tees CCG GP and Governing Body Member Dr Janet Walker with local patient Kay Hutchinson Table of Contents Table of Contents Members Practices’ Report .................................................................................................................. 4 Strategic Report .................................................................................................................................... 7 Clinical Workstreams ...................................................................................................................... 12 Quality, Performance and Finance ................................................................................................. 13 Quality ......................................................................................................................................... 13 Performance ............................................................................................................................... 20 Finance ........................................................................................................................................ 26 Research and Innovation ................................................................................................................ 31 Sustainability ................................................................................................................................... 31 Partnership Working ....................................................................................................................... 36 Members’ Report ................................................................................................................................ 38 Statement of Accountable Officer’s Responsibilities .......................................................................... 41 Governance Statement ....................................................................................................................... 42 Clinical Council of Members ........................................................................................................... 50 Our Governing Body ........................................................................................................................ 54 Quality, Performance and Finance Committee .............................................................................. 63 Audit Committee ............................................................................................................................. 65 Remuneration Committee .............................................................................................................. 69 Remuneration Report ..................................................................................................................... 69 Governance and Risk Committee ................................................................................................... 74 Funding Panel .................................................................................................................................. 75 Equality and Diversity ..................................................................................................................... 76 The Executive Team ........................................................................................................................ 79 Risk Management Framework ........................................................................................................ 80 Internal Control Framework ........................................................................................................... 82 Risk Assessment .............................................................................................................................. 86 Economy, efficiency and effectiveness in the use of resources ..................................................... 89 Review of the effectiveness of governance, risk management an internal control ....................... 91 INDEPENDENT AUDITOR’S REPORT .................................................................................................... 93 Financial Statements ........................................................................................................................... 96 Statement of Comprehensive Net Expenditure for the year ended 31 March 2014 ..................... 97 Statement of Financial Position as at 31 March 2014 .................................................................... 98 Statement of Changes in Taxpayers Equity for the year ended 31 March 2014 ............................ 99 Statement of Cash Flows for the year ended 31 March 2014 ...................................................... 100 3 Member Practices’ Report Members Practices’ Report Introduction Our first year has been one of significant transformation; GP practices from across South Tees were placed at the heart of local commissioning by the changes to the NHS Health and Social Care Act 2012. Clinicians have been making a significant contribution to improving the health and wellbeing of local people since the NHS was formed, however, we now have a role in leading the local NHS and extending our leadership beyond the GP practice and across the South Tees health landscape. As a CCG we cannot do this alone, we have been forging partnerships with organisations who share a common goal to improve health and care services; this includes our local authorities, local Foundation Trusts who deliver hospital‐based and community services, the voluntary and community sector and Healthwatch. Locality Councils and the Clinical Council of Members As a membership organisation, a representative from each of the 49 practices across South Tees comes together with clinical colleagues to influence the development of and the type of services we commission. The Governing Body which comprises of six local GPs as well as lay members from the local community, a secondary care doctor and CCG officers is accountable to the membership. We contribute to the CCG in many ways, one of which is through Locality Clinical Councils in Eston, Langbaurgh and Middlesbrough retaining a local focus for our patients. Practices also come together on a quarterly basis as a Clinical Council of Members, to meet with Governing Body members seeking assurance on the work they do on our collective behalf in delivering our statutory duties and our plans. This year, through our locality groups and through our independently chaired Clinical Council of Members we have implemented a process to support continual improvements to the quality of primary care services, approved 4 changes to our constitution and implemented effective communication mechanisms with Member practices to ensure we are all connected to the commissioning agenda. Governing Body Clinicians have been at the heart of our organisation and through our Clinical Council of Members, Governing Body, Locality Clinical Councils and our clinically led work streams we have been making a significant contribution to shaping the design and delivery of patient focused care. Our Governing Body has had a strong focus on quality throughout our first year. Seeking local assurance against the issues raised in a number of national independent inquiries into care failings has been a priority to ensure high quality, compassionate and safe services that respect people’s dignity are available to local people. We have also offered scrutiny and challenge with regards to quality, performance and finance monitoring. Furthermore, the Governing Body has sought assurance regarding plans for winter preparedness and the Better Care Fund, considered the Call to Action and our IMProVE programme which included the experience and views of local patients and the public. In addition, to providing regular reports to the Clinical Council of Members, the Governing Body has undertaken a self‐assessment of its effectiveness in our first year. In reviewing and assessing Governing Body effectiveness, we can report that the guidance contained within the Code has been followed. The guidance has enabled a detailed review of Governing Body effectiveness against the following criteria: leadership, effectiveness, accountability, remuneration and relations with stakeholders on a ‘comply or explain’ basis. The review was also supported by a dedicated development session for the Governing Body to review Governing Body compliance with the Code. In particular, having reviewed the effectiveness of our governance framework and arrangements in relation to The UK Corporate Code of Governance, our Chief Officer reports that that the organisation complies with the principles and standards of best practice Member Practices’ Report contained within the guidance on a ‘comply or explain’ basis. Our Chief Officer confirms that the arrangements in place for the discharge of statutory functions have been checked for any irregularities, and that they are legally compliant. Further details of this review can be found in our Annual Governance Statement on pages 42 to 45. Workstreams Our clinically led workstreams have taken great strides forward focusing on the priorities we agreed as part of our Clear and Credible Plan ‐ our strategy which was established as a starting point for our newly formed CCG. The plan sets out how we will meet the needs of local people, develop services, promote good health and importantly reduce health inequalities. Clinical and non‐clinical staff from across our member practices have been working through our workstreams each headed up by a clinical lead delivering our commissioning plans. Collectively they have participated in the procurement of a telephone physiotherapy advice service; invested in a cardio pulmonary exercise testing to assess fitness for medical procedures and reducing risk of complications; established a revised clinical pathway for the management of Deep Vein Thrombosis; developed the basis for an Urgent Care Strategy and ensured implementation of national cancer screening and awareness campaigns. We also have a long‐term strategy, in particular our Integrated Management and Proactive Care of the Vulnerable and Elderly (IMProVE) programme centred on improving care for the vulnerable and elderly. As members of the CCG, GP practices have been invited to shape our ambition to deliver health and social care services that are proactive and integrated for people who are vulnerable and elderly. This work will ensure they are receiving care in the most appropriate setting, as close to home as possible supporting their mental health and wellbeing alongside their physical health. Quality, Performance and Finance Our organisation and many of the organisations we commission services from have met performance targets for this year – often working in some challenging circumstances. Nonetheless, we have shared our clinical expectations for local people with our service providers and pursued our commitment, indeed duty, with regards to quality. We have performed well with regards to waiting times for cancer services, ambulance response times across the patch, and seven day follow up from discharge for patients in mental health services. However, we were not successful in reaching our ambition and performance measures relating to smoking in pregnancy, and we had some cases of healthcare acquired infection at a local hospital. This is disappointing and we will work hard to improve in these areas, and maintain or exceed performance where we have achieved good results this year. Member engagement Our membership has shared their experience with us as we have developed in our first year as clinical commissioners. Sometimes practices have felt overwhelmed by the sheer volume of commissioning information that has been shared with them – while some are happy with the information we are sharing, others are telling us we need to be more concise. In addition, we need to take our plans to our membership sooner, so that they can have more time to debate and discuss, and to influence and help shape them at an earlier stage. For some practices this has sometimes felt like decisions have already been made or clinical input has been limited due to the timescales required to get things done. However, the opportunity to collaborate with fellow clinicians and GP practices has been welcomed along with the CCG’s inclusive approach which has enabled some practices to feel they have really contributed to decision making within the organisation. Regular meetings in our three localities have been well received and have helped members work together. Engagement with our member practices to benefit our local population has always been central to who we are and how we 5 Member Practices’ Report has enabled us to understand the possibilities as well as some of the restrictions we face in delivering our commissioning responsibilities. It has not always been easy to balance our commitments to our individual patients with our new commissioning responsibilities for the people of South Tees as whole; however, this is just the beginning and we are grasping this opportunity to transform local services, improve the links between primary and secondary care and ensure the health and wellbeing of local people continuously improves. We look forward to working with our membership to build on our achievements and learn from our experience as commissioners as we enter our next year. work as a CCG, reflected in visits to each of our 49 practices by our Chief Officer and clinical Chair. We felt strongly this was of value to our organisation and one of our members told us. “The Governing Body has engaged with practices really well, particularly on a personal level. I think this makes a great difference and fosters a great deal of goodwill” Conclusion This has been an exciting but challenging year as the changes to the health service and the economic climate have been realised. This year Dr Janet Walker GP, Manor House Surgery Elected Locality Lead for Eston Governing Body Member 6 Dr Ali Tahmassebi GP, Bentley Medical Practice Elected Locality Lead for Langbaurgh Governing Body Member Dr Vaishali Nanda GP, Discovery Practice Elected Locality Lead for Middlesbrough Governing Body Member Strategic Report: Our first year Amanda Hume 
Chief Officer 
Strategic Report We are pleased to present our first strategic report which sets out who we are; describes our organisation and what we do; and shares our priorities. It also describes the way we are working to deliver our priorities, and making improvements in local services for the health and wellbeing of local people. Of the services that we do not commission the majority are commissioned by NHS England including; 


About us The Clinical Commissioning Group (CCG) is a new NHS organisation licenced from 1 April 2013 under provisions enacted in the Health & Social Care Act 2012, which amended the NHS Act 2006. We are responsible for commissioning healthcare for the population registered with GP Practices within the boundaries of Middlesbrough Council and Redcar and Cleveland Council. We are also responsible for the population living within the boundaries of these two local authorities who are not registered with a GP Practice. We are a membership based organisation made up of GP practices in Middlesbrough and Redcar and Cleveland, spanning a population of 273,910. Our budget is £387 million which equates to £1,413 per person. We commission a specific set of healthcare services that include;  General non‐specialised planned inpatient and day case hospital services  General non‐specialised urgent care services from hospitals and walk‐in centres, NHS 111 and local ‘out of hours’1 services  General non‐specialised maternity and children’s services  Community services  Non‐specialised mental health services  Continuing health care and free nursing care services 1
Medicines prescribed by the GP Practices within the CCG boundary Other non‐specialised diagnostic and treatment services such as x‐ray or hearing aid services 

Specialised services Primary care services, GP services, Dentists, Opticians and Pharmacists Oral surgery and dental services from hospitals Healthcare for members of the armed forces Healthcare for prisoners Specialised services are those that are typically provided in less than fifty hospitals in England. Definitions of the services are listed on the NHS England website Public Health England is the national body responsible for commissioning screening, vaccination services, as well as Health Visitor services. Local public health services are now commissioned by the local authorities. Our responsibility for commissioning starts with assessing the needs of the population and then planning services to meet identified needs. Services are secured through contracts with the organisations that provide health services. We then monitor those services through the contracts to ensure high quality care is delivered. In the South Tees area we face some big health challenges. These include:  Overall health inequalities with significant differences in the health of some groups within our population  Heart disease and stroke  Cancer  Illnesses caused by smoking  Illnesses caused by alcohol  Managing hospital admissions and demand within primary care services  Financial pressures Evening, night time and weekend doctor services 7 Strateegic Repo
ort: Our First Yeaar To tacklee these healtth challenges we have developed a clear vision to improve health together. We will work closelyy with our tw
wo Health an d Wellbein
ng Boards, one in Middle
esbrough andd the other in Redcar and Cleveland. W
We have alreeady produceed a Clear and Credible Plan which seets out our five year com
mmitment to
o tackling heealth inequalities and imp
proving the h
health of locaal people. The plan is aaligned to the Health andd Wellbein
ng Strategiess that have b
been developped by the B
Boards in thee two localitie
es. This is an overview o
of how we ha
ave spent ouur allocated budget forr 2013/14 to deliver the bbest possiblee health serviices and health outcomees for local peo
ople. Commisssioned Servvices 2013‐14
4 Prescribing £51.53M Other Exxpenditure £7.611M Non‐N
NHS Servicces £46.044M NHS Services £277.76M Our orgaanisational m
model Our CCG
G is built arou
und the 49 G
GP member practices, led by thee Governing B
Body. This member includess six GPs eleccted by the m
practices, an executive nurse and a retired secondaary care docttor as well ass two lay memberrs, the Chief Officer and Chief Financce Officer. The clinician
ns form the m
majority of thhe Governing Body meaaning that th
hey are able lead and shap
pe local com
mmissioning. We havee a small team of eleven core staff thhat we direcctly employ ((including ou
ur Chief Officcer and Chieef Finance Officer), and w
we share a quality tteam with ou
ur neighbourring CCG, NH
HS Hartlepo
ool and Stockton‐On‐Tee
es Clinical Commisssioning Grou
up. We purcchase a widee range of support functioons which en
nables us to deliver our d
duties and p lans from a ccommissionin
ng support u
unit (North off England Commission
ning Supportt). This organisaation spans tthe North East and Cumbbria 8 whicch enables us to achieve e value for money by provviding the tra
aditional bacck office funcctions. It also
o means that we can draw
w upon know
wledgeable and experiennced commissioning supp
port experts from acrosss the region. Furtther information on our m
nt managemen
funcctions is provvided in the ggovernance statement on pa
ages 42 to Errror! Bookmark not defined. of this report. Review of our fiirst year The rest of this rreport descriibes what we have achiieved in our first year, thhe risks and challlenges we have faced ass well describ
bing som
me of our plan
ns for the yeear ahead. How
w did we do?
? We have perform
med well in aa number off areas thou
ugh we always aim to doo better. We have delivvered on the
e statutory d uties placed upon us under the NHS A
Act 2006 as w
well as our lo
ocally defined commitments. Our focus on our corp
porate objectives has beeen maintaine
ed thro
oughout the year and goood progress has been mad
de particularly in relationn to quality, u
urgent care
e including w
winter pressuures, our IMP
ProVE proggramme and partnershipp working wh
hich is cruccial to all that we do. Perfformance at a glance: Waits for cancer serviices Exceeded targets for nnumber of pe
eople not waiting unnecessarily foor cancer services Ambulancce response times Exceeded targets for nuumber of am
mbulances responding
g within 8 minnutes and 19 m
minutes Seven day
y follow up from discharge for people who use menttal health se
ervices Exceeded target for nuumber of peo
ople seen en days of dis charge within seve
Smoking iin pregnancyy More preg
gnant smokeers in our area than reasonably
y expected Healthcarre acquired iinfection Some infecctions acquireed in health se
ervices We have perform
med well witth regards to
o waiting time
es for cancerr services, am
mbulance ressponse time
es, and seven
n day follow up from discharge for p
people who use mental hhealth servicces. Strategic Report: Our first year However, we were not successful in reaching our ambition and performance measures relating to smoking in pregnancy. Furthermore, we had some cases of healthcare acquired infection at a local hospital. This is disappointing. In our next year we will work hard to improve in these areas, and maintain or exceed performance where we have achieved this year. We have delivered a 1% surplus at the end of our first year. Throughout 2013/14 we have applied good financial governance principles enabling us to meet the health needs of local people delivered through our commissioned services as well as releasing additional resource to support our first Community Innovations Fund, investing over £200k in community based services for local people. In addition, through close monitoring via our Contract Management Board, our Payment by Results (PbR) contracts have delivered costs in line with our plans. However, whilst good progress has been made with regards to Quality, Innovation, Productivity and Prevention (QIPP) plans, we fell short of this target by approximately £2 million. We achieved most aspects of our quality premium, which rewards efforts to tackle key priorities and this has released funds for us to invest in local health services. We achieved our ambitions to reduce the number of readmissions to hospital within 30 days of discharge as well as increasing our diagnosis rates for people with dementia. We have worked hard at engaging well with our membership, with online communication solutions as well as regular briefings sharing outcomes from our Executive meetings. In addition, our membership voted to have quarterly meetings of the Clinical Council of Members bringing together all 49 practices to engage in commissioning matters, and the group is independently chaired by a non‐Governing Body clinician. In addition to visiting each of our practices this year, and talking with our members about their expectations and apprehensions about clinical commissioning, we have listened to the feedback from our members on their experiences of our first year. We will be working hard to get the balance of information right, to involve members earlier in the development of our plans and to continue to maximise the opportunity we have to talk to each other about best meeting the needs of local people. Finally, our engagement with hundreds of local people and a large number of groups has taught us much ‐ not only about the experience of people we have met, but how to really engage and do it better. This will be a priority for us as we go into 2014/15. Risks and challenges However, our first year has not been without its challenges. We have identified a number of risks that have the potential to adversely impact on the delivery of our duties and plans. They include the risks that  we may be unable to remain within an acceptable level for cases of the healthcare acquired infection Clostridium difficile  we may be unable to reach the national requirements for time from referral to treatment 90% of the time  identifying a lead GP to meet OFSTED and CQC requirement for safeguarding children  the transfer of funds from acute care to the new Better Care Fund could have an adverse impact on some hospital services  the capacity of our Continuing Health Care team cannot meet the demands on the service, particularly in light of restitution cases  we are unable to sustain the engagement of our member practices in clinical commissioning due to the new, nationally defined GP contract  demand for health services in winter may exceed capacity in services such as A&E We have plans in place to reduce the likelihood and impact of these risks and we have kept these risks under close review throughout the year. More detail can be found in our Annual Governance Statement on page 42. 9 Strategic Report: Our First Year Looking to the Future The year ahead will be both exciting and challenging. We move in to the next phase of our IMProVE work, supported by our clinical workstream and informed by our consultation with the public about the transformation of health and social care services for our vulnerable and elderly population. The coming year will be an opportunity for further partnership working and the Better Care Fund is an excellent way of developing relationships between the CCG and local partners. As we move forward it will be with the same underlying philosophy, that in order to improve health it must be done together, in partnership. Whilst the Better Care Fund is uncharted territory in some senses, bringing health and social care together, there is a long history of partnership working, so we start from a strong base. We want to develop strategies to underpin all the services we commission to ensure we are focussed upon continuous improvement in the short, medium and long term alongside the achievement of better health outcomes and experience for patients. We want to engage more. Not only with local people and partners such as the voluntary and community sector but also with our member practices. We have a number of local clinicians and other staff from our member practices dedicating time to our shared vision as a CCG. However, we want to gain greater clinical input, engage more widely and learn from the knowledge and experience of the hundreds of clinicians across our membership. Further detail about our plans for next year can be found on pages 46‐48. 10 Strategic
S
c Report:: Our Prio
orities Our Prriorities The firstt year of NHSS South Tees Clinical Commisssioning Grou
up has been a time of celebrattion and achiievement and the CCG h as accomplished a greaat deal. Our vvision, valuess and aims have been developed in partnershiip with ourr member prractices, cliniicians, partneers, providerrs and patien
nts, with qua
ality driving aall that we do. We havee had a consistent leaderrship team aat the helm sin
nce our incep
ption along w
with welcom ing our Execcutive Nurse in April 2013. This collecctive knowled
dge and expeerience has h
helped devellop our strattegies and plans from the beginning and ensured
d stability thrroughout the
e transition ffrom shadow form to a fu
ully authorise
ed organisatiion without any conditio
ons. As part o
of the authorisation proccess for CCG s we produceed our Clear aand Credible
e Plan settingg out our visio
on for the loccal health economy alongg with ourr strategic aims, our plan
n can be founnd on our w
website www
w.southteescccg.nhs.uk. In orderr to deliver th
hese plans w
we establisheed our corp
porate objecttives. They o
outline the keey organisaational goals required to deliver our aims. W
We developed
d the objectivves so that w
we could measure progress through
hout the yearr enablingg our Govern
ning Body to receive assurancce updates that describe
e the progresss that the CCG is makiing against th
he delivery oof our strattegic goals: Our objectives:
 improve the
e quality, safeety and patie
ent experiences of commisssioned services  develop a prrimary care sstrategy a membershiip organisatiion  develop as a
engaging all practices ncial balancee  deliver finan
 deliver our IMProVE proogramme  work in parttnership urgent care sstrategy  develop an u
We identified a number of kkey enablers to ensu
ure progression of our coorporate objectives inclu
uding  improving quality standaards by leadiing the local health economy in responding to the recommend
dations of thee Francis enq
quiry into the qua
ality of care i n Mid Staffo
ordshire.  working with and suppoorting the developmen
nt of the Norrth of Englan
nd Commission
ning Support Unit in orde
er to ensure there
e are strong commission
ning support servvices availabble to our CCG
G.  taking a key role on the Health and Wellbeing Boards contriibuting to raising awareness o
of health relaated issues a
and the impact on so
ocial care annd the wellbe
eing of local people
e. ative in the w
way our orga
anisation  being innova
and our com
mmissioned sservice providers undertake o
our duties annd deliver carre which will enable o
our CCG to reealise benefits that have previously not beeen realised byy the munity.
health comm
11 Strategic Report: Delivering Our Plans How we deliver our plans Planning The CCG analyses demographic and historical information to assess the levels of services that are likely to be required in future years. This is principally based on the expected population growth and anticipated changes in the age and gender profile of the population. This is combined with an assessment of historic trends experienced up to the current period. In addition more specific factors are reviewed that take account of the latest national guidance for some services, introduction of new technology and new medicines. This overall assessment of service requirements is then analysed over the twelve month period to identify the appropriate seasonal profile. We review patients’ pathway or journey through our local services; these reviews of ‘patient pathways’ form the core of the CCG’s workstream activities. The results of these reviews are combined with the overall activity planning information to form the CCG’s potential commissioning intentions for each year. The CCG then works with its contracting team to agree contracts with health providers based on the commissioning intentions. Clinical Workstreams In order to deliver our plans for improving people’s health and local services, we established a number of clinically led groups called ‘workstreams’ which have been leading improvements in local services over the last 12 months. Our workstreams are led by local GPs working with doctors, nurses and practice managers from our membership along with local NHS and local authority partners to understand how services need to change. Our workstreams have been developed to implement new ways of working to ensure the best use of NHS resources and the best outcomes for patients. Our workstreams have developed over the last year delivering and informing commissioning 12 plans, considering innovations and new ways of working and have provided an opportunity for joint commissioning with our local authority partners. Our workstreams have demonstrated positive partnership working particularly in our IMProVE programme, winter planning and urgent care. These workstreams supported reductions in emergency admissions and the steady uptake of rapid response and Integrated Community Care Teams which aim to deliver person centred care to our patients. Our workstreams are: Health and Wellbeing ‐ working with partners including public health experts from local authorities to prevent people from becoming unwell; to improve the early detection of illnesses so people can get help quickly; and to reduce health inequalities. We are also working hard to improve the quality of life for people with long‐term conditions, to improve the health and wellbeing of carers, increase awareness of cancer and to support patients to understand diabetes and respiratory conditions to improve their own health. Urgent Care – aims to identify issues and solutions to reduce acute hospital admissions; to redesign the primary care urgent care walk‐in pathway; to review access to geriatric care; and to implement a nurse led triage model of care within Accident and Emergency. This workstream successfully implemented our winter plans, developed a multi‐agency Urgent Care Strategy; implemented Rapid Process Improvement Workshops for the front of house service; began a review of Walk‐in Centres and successfully implemented 111 across South Tees. Care Closer to Home: Planned Care – focusing on non‐urgent, planned services to ensure that patients can access a choice of provider and aims to improve access for GPs to a range of diagnostics. Achievements include the review of the community contract supporting our IMProVE programme, the re‐commissioning of the Physio Advice Line and a review of dermatology services. Strategic Report: Quality, Performance and Finance Care Closer to Home: Mental health and Learning Disability ‐ working through clinical leads to deliver the national Dementia Strategy; ensuring Child and Adolescent Mental Health Services (CAMHS) meet NICE guidelines; and implementing changes following the Winterbourne Review. The workstream has implemented a review of how to improve the recording and diagnosis of dementia within primary care; reviewed current arrangements for perinatal mental health services; and developed an implementation plan for alternative rehabilitation/recovery services. Care Closer to Home: Integrated Management and Proactive Care for the Vulnerable and Elderly (IMProVE) – charged with improving outcomes for patients being cared for by community teams, reviewing and developing pathways of care associated with the frail elderly and exploring and implementing opportunities for health and social care integration. The workstream has implemented a risk stratification process to systematically identify and manage patients identified as being high risk of future admission to try and prevent or delay deterioration and created a new rapid response service for those patients who, without immediate support at home either from professionals, would be admitted to hospital. Medicines Optimisation ‐ ensures that we are making the most cost effective use of medicines. Our workstream has successfully kept prescribing within budget this year whilst also developing the Deep Vein Thrombosis pathway and changing the local decision making process around medicines and appliances. Quality Improvement in Primary Care ‐ this group is crucial to the delivery of many of our other workstream initiatives. We have a statutory duty to support NHS England to improve the quality of primary care services. The workstream has introduced a programme which enables practices to identify ways of creating capability and capacity in practices called the Deep End Project to tackle health inequalities and developed an education strategy to support the on‐going professional development of primary care teams through education sessions. Another successful initiative spanning all of our workstreams has been the Organisational Development programme. It was designed for members of our clinical workstreams to support clinically led commissioning and to equip clinicians with the tools to deliver our commissioning intentions. The programme has focused on the self‐identified learning needs of workstream members and included leadership skills, new NHS duties regarding consultation and engagement, innovation and service reform. The workstreams will continue to actively address our priorities moving into the next financial year. Quality, Performance and Finance The CCG’s performance monitoring regime is focused on monitoring the quality, performance and costs of the services that we commission to ensure high standards of care are delivered to patients representing the best value for taxpayers’ money. We review monthly performance information obtained from;  National information systems  Data provided by healthcare providers  Our own analysis services Our Governing Body has established a dedicated committee for monitoring performance, the Quality, Performance and Finance Committee. More information on the role of this committee is available in the governance section of this report on pages 64‐65. Quality ‐ Patients first and foremost One of our principal responsibilities as a CCG, which is enshrined within our constitution, is to drive up the quality of health services. Quality underpins all that we do; we routinely review and challenge our local understanding of quality through our Governing Body and its committees, our clinical workstreams and our contract management processes.
13 Strategic Report: Quality “The most important single change in the NHS in response to this report would be for it to become, more than ever before, a system devoted to continual learning and improvement of patient care, top to bottom and end to end.” Learning from other areas “Other organisations including the commissioner of services and those with responsibility for oversight and management of the health system, also have lessons to learn and improvements to take forward.” Mid Staffordshire NHS Foundation Trust: A review of lessons learnt for commissioners and performance 2
managers following the Healthcare Commission investigation
We have a duty to ensure that the care and services we commission are safe, effective and result in a positive experience for the people who use them. We are not complacent about quality and understand our responsibility and the trust placed in us to commission safe, compassionate services with good outcomes. There is much we can learn from those areas elsewhere in the country where poor standards of care have been experienced. We will learn from these examples and focus on continuously improving services across South Tees. ‘Patients first and foremost’ was the title of the Government’s initial response to the Report of the Mid Staffordshire NHS Foundation Trust. The public inquiry which was published in 2013 is usually called ‘The Francis Report’ after the author Robert Francis QC. Professor Sir Bruce Keogh, NHS Medical Director for England was requested by the government, shortly after the Francis Report to conduct a review of hospital trusts with persistently high mortality (death) rates. The review3 highlighted the importance of commissioners having robust quality monitoring and assurance processes which are patient focussed and emphasise a whole systems approach. 4
Professor Berwick, Improving the Safety of Patients in England Professor Berwick was commissioned by the government to study reports of Mid Staffordshire and the Francis Report recommendations along with others in order to distil lessons learned and highlight the changes needed in the NHS. Berwick outlined a set of core principles he viewed as necessary to deliver improvements as well as detailing ten recommendations which have implications for the NHS health care system as a whole. The Department of Health published the Winterbourne View Hospital review in 2012. In this report, it was concluded that staff whose job it was to care for and help people with a learning disability instead routinely mistreated and abused them. The report set out a programme of action to transform services so that vulnerable people would no longer live inappropriately in hospitals and would be cared for in line with best practice, ensuring better care and outcomes for them. The Winterbourne Concordat sets out a programme of action for all providers, commissioners and regulators, to transform services for people with learning disabilities or autism as well as mental health conditions or behaviours described as challenging. Our response to the national inquiries 

2
The Mid Staffordshire NHS Foundation Trust Public Inquiry http://www.midstaffspublicinquiry.com/key‐
documents 3
The Keogh Mortality Review, http://www.nhs.uk/NHSEngland/bruce‐keogh‐
review/Pages/Overview.aspx 14 We reviewed the 290 recommendations from the Mid Staffordshire inquiry and developed an implementation plan to ensure that we learn from others and adopt best practice. We continually monitor quality delivered by commissioned health service providers through our Clinical Quality Review Groups. 4
https://www.gov.uk/government/uploads/system/u
ploads/attachment_data/file/226703/Berwick_Repor
t.pdf Strategic Report: Quality 


We implemented a review methodology using the metrics that are similar to the national hospital reviews to assess locally commissioned services. We are active members of a joint commissioning group focused on implementing the Winterbourne Concordat. We reviewed the recommendations from the Winterbourne inquiry and developed an implementation plan to ensure that we learn from others and adopt best practice. The findings of these and other recent national reviews into quality and patient safety have been at the forefront of our work this year. We will continue to: 


ask ourselves and our providers challenging questions about quality robustly scrutinise local service delivery as experienced by patients embed learning from other parts of the country to benefit people here in South Tees We also have a number of dedicated groups that focus on quality and in turn influence our work programmes and activity. They enable us to assess the quality of services delivered by our commissioned service providers: Quality, Performance and Finance Committee The committee ensures that the services commissioned are subject to scrutiny of quality and patient safety by routinely reviewing quality metrics and related soft intelligence. Clinical Quality Review Groups We have a number of these groups which focus on an individual provider of health services. They ensure implementation of quality standards, indicators and the NHS Outcomes Framework. They seek assurances regarding the safety, patient experience and clinical effectiveness of services provided and agree direction for clinically led continuous quality improvement. Quality Surveillance Groups Local Quality Surveillance Groups are led by the Area Teams of NHS England. They bring together regulators, commissioners and providers of services to explore quality by sharing intelligence, particularly that which could help identify early signs of service failure or poor quality. They also include primary care services such as GP practices, dentists, pharmacists and optometrists. Quality in Primary Care Although we do not commission primary care services, we have a duty to improve the quality of primary care working with the Area Team and our member practices. Our Quality in Primary Care Workstream has developed a support process to enable us to review quality, share good practice and offer additional support to address challenging areas where required. Walking the service As part of our approach to quality we also undertake both announced and unannounced visits of the health services we commission. This year we have tested our approach with our local hospital trust and we plan to implement this approach to other services in the coming year. Onsite visits are part of a wider ranging and ongoing quality assurance and contract management process which includes:  quarterly assurance visits at executive level to review quality markers from the previous quarter;  announced and unannounced site based visits;  involvement in provider’s own board to ward/service visits;  regular monitoring meetings as described above;  regular liaison between the CCG Chief Officer and provider Chief Executives;  gathering of soft intelligence from GP practices and patient complaints;  the Local Area Team’s Quality Surveillance Groups. In addition to the assurance mechanisms outlined above, benefits of a site‐based assurance visit include the development of a common understanding of providers’ working processes and practices. Commissioners and providers collectively identify constraints to 15 Strategic Report: Quality service delivery and quality as well as areas of good practice. Our Executive Team talked with patients and staff in a number of different services areas. Visits included: Service Area Date Executive Team to Executive Team 15/10/13 meeting Paediatric Day Unit 28/10/13 Disablement Services 31/10/13 Theatres and Inpatient Wards 26/11/13 Maternity 30/01/14 Acute Admissions 27/02/14 Surgery – Ward 6 27/03/14 Our clinicians discussing the issues with fellow clinicians at the Trust has been insightful and has helped us to understand and look at solutions that we otherwise may not have considered. Safeguarding We have a statutory duty and responsibility to safeguard children and adults at risk from abuse and neglect. In addition we must ensure robust arrangements are in place for Looked After Children. Our team of designated safeguarding professionals works with Local Authorities, NHS England and other partners to deliver our duties. They contribute to Local Safeguarding Children Boards, Teeswide Adult Safeguarding Board, Serious Case Reviews and Lessons Learned reviews. In our first year the team has worked closely with providers including South Tees Hospitals NHS Foundation Trust and Tees Esk and Wear Valley NHS Foundation Trust to audit services for Looked After Children. They have also contributed to the development of safeguarding supervision practice and the development of strategic groups including Designated Professionals/Named Doctor Forum; Named Nurses Safeguarding Children Group and a Looked After Children Forum. Each of these groups has an action plan which is directly 16 related to improving outcomes for children across South Tees. The team also provide support to GP practices and have developed a programme of safeguarding children support visits to help primary care clinicians to understand their contribution to safeguarding children. CCG Quality Metrics We have a number of indicators that give us an insight into the quality of care being delivered to local people by our commissioned service providers. Our largest service providers are  South Tees Hospitals NHS Foundation Trust – STFT  Tees, Esk and Wear Valley NHS Foundation Trust – TEWV  North East Ambulance Service ‐ NEAS Regulator Actions Has any local provider been subject to local enforcement action by the CQC? During 2013‐2014 CCG STFT Not applicable
No TEWV NEAS Yes No The Care Quality Commission (CQC) makes sure NHS and other care services in England provide people with high‐quality care. They inspect services and they can use their powers to make a service change; in serious cases this can be an enforcement action to prevent people from harm. CQC inspections have been undertaken and the reports are available on the CQC website. However, as a result of a CQC inspection to a Durham inpatient service which is part of Tees, Esk and Wear Valley NHS Foundation Trust compliance actions were directed by the CQC. The trust has developed and implemented an action plan, which was monitored by our Contract Management Board and the Clinical Quality Review Group. Strategic Report: Quality Has any local provider been flagged as a 'quality compliance risk' by Monitor and/or are requirements in place around breaches of provider licence conditions? not higher than expected. Our other providers are not required to report on mortality figures. Has any provider been identified as a 'negative outlier' on HSMR? During 2013‐2014 CCG STFT Not applicable No TEWV NEAS Yes No During 2013‐2014 CCG STFT Not applicable
Yes TEWV NEAS Not Not applicable applicable
Monitor, the independent regulator of Foundation Trusts, can direct action within Trusts that may be in breach of their licence to deliver services. The Hospital Standardised Mortality Ratio (HSMR) compares the expected rate of death in a hospital with the actual rate of death. South Tees Hospitals NHS Foundation Trust’s mortality figures were higher than expected. South Tees Hospitals NHS Foundation Trust was subject to intervention by Monitor because it failed to meet the national 18‐week referral to treatment time target (RTT) for three quarters in a 12 month period. Tees, Esk and Wear Valley NHS Foundation Trust was the subject of investigation and scrutiny by Monitor for a short period as a result of concerns raised by a CQC inspection relating to governance. The trust responded providing assurance to Monitor of its actions which resulted in the ‘quality compliance risk’ being removed. Clinical effectiveness Has any provider been identified as a 'negative outlier' on SHMI? The Trust has remained an outlier for HSMR during the majority of 2013‐14. During robust scrutiny and challenge at the regular Clinical Quality Review Group meetings the Trust has provided evidence of internal investigations, peer review and actions implemented. It is anticipated that the outcomes from these will show an improvement in the HSMR in the coming months when the rates are re‐based nationally. This area will continue to be the subject of monitoring, scrutiny and clinical challenge. Patient experience Does feedback from the Friends and Family Test (or any other patient feedback) indicate any causes for concern for any provider? During 2013‐2014 CCG STFT Not applicable No TEWV Not Not applicable applicable
The Summary Hospital‐level Mortality Indicator (SHMI) is the ratio between the actual number of patients who die following in‐patient hospital treatment and up to 30 days after discharge at the trust, and the number that would be expected to die on the basis of average England figures. Our local Trust’s mortality figures were Quarter Four: Jan – March 2014 CCG STFT TEWV NEAS NEAS Not applicable
No Not Not applicable applicable
The Friends and Family Test asks patients whether they would recommend hospital wards, A&E departments and maternity services to their friends and family if they needed similar care or treatment. South Tees Hospitals NHS Foundation Trust is the only organisation required to participate in this test. 17 Strategic Report: Quality At the end of Quarter Four (Jan – March 2014), the combined Friends and Family Test response rate was 29.3%, and the combined score rating satisfaction was 71%. Safety Does any provider currently have any unclosed Serious Untoward Incidents (Grade 1 incidents ‐ 45 days)? During 2013‐14 CCG STFT Yes Yes TEWV NEAS Yes Yes Incidents are graded depending on their severity as either Grade 1 or Grade 2. NHS organisations are required to complete a report of any incident investigation classified as Grade 1 within 45 days. Across South Tees one or more investigations within each organisation have taken longer than 45 days. Does any provider currently have any unclosed Serious Untoward Incidents (Grade 2 incidents ‐ 60 days)? As at March 2014 CCG STFT A serious incident requiring investigation is defined as an incident that occurred in relation to NHS‐funded services and care resulting in one of the following:  unexpected or avoidable death of one or more patients, staff, visitors or members of the public;  serious harm to one or more patients, staff, visitors or members of the public or where the outcome requires life‐saving intervention, major surgical/medical intervention, permanent harm or will shorten life expectancy or result in prolonged pain or psychological harm (this includes incidents graded under the National Patient Safety Agency definition of severe harm);  a scenario that prevents or threatens to prevent a provider organisation’s ability to continue to deliver healthcare services, for example, actual or potential loss of personal/organisational information, damage to property, reputation or the environment, IT failure or incidents in population programmes like screening and immunisation where harm potentially may extend to a large population;  allegations of abuse;  adverse media coverage or public concern about the organisation or the wider NHS;  one of the core set of never events. 5 5
NHS England Serious Incidents Framework http://www.england.nhs.uk/wp‐
content/uploads/2013/03/sif‐guide.pdf 18 Yes Yes TEWV NEAS Yes Yes Some incident reviews can be complex and require independent investigation which may take longer to complete. Across South Tees one or more investigations of incidents classified as Grade 2 within each organisation have taken longer than 60 days. Has any provider experienced any 'Never Events' during the last year? During 2013‐14 CCG STFT No Yes TEWV NEAS No No Never events are serious, largely preventable patient safety incidents that should not occur if the available preventative measures have been implemented by healthcare providers. South Tees Hospitals NHS Foundation Trust has reported three Never Events in 2013‐14. Strategic Report: Quality Do provider level indicators from the National Quality Dashboard show that meticillin‐
resistant staphylococcus aureus (MRSA) cases are above zero? During 2013‐14 CCG STFT Not applicable Yes TEWV NEAS No Not applicable
Hospitals are set a maximum number of cases of hospital acquired infection that they are required not to exceed. During the year three cases of MRSA were reported by South Tees Hospitals NHS Foundation Trust, exceeding this target. Two of the three cases were NHS South Tees CCG patients. Do provider level indicators from the National Quality Dashboard show that Clostridium Difficile cases are above trajectory? During 2013‐14 CCG STFT Not applicable Yes TEWV NEAS No Not applicable
The Department of Health sets an annual trajectory, specific to each trust, for the number of hospital acquired Clostridium Difficle cases. During the year 57 cases of Clostridium Difficle were reported by South Tees Hospitals NHS Foundation Trust, against a trajectory of 37 resulting in a breach of this objective. 19 Strategic Report: Performance Performance Performance is a key part of our understanding as a commissioner of the services that are being provided to local people and how well our plans are being implemented. We review performance within the context of quality and finance, recognising the role all three play in the delivery of safe and effective services that impact positively in terms of both experience and outcomes for those who use them. Performance is recorded at the end of each month for the year beginning 1 April 2013 and ending 31 March 2014. were not admitted to hospital waited more than eighteen weeks. Percentage of patients incomplete pathways waiting no more than 18 weeks During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 92 95.5 96 94.6 97 N/A At the end of the year, 497 patients continued to wait in excess of 18 weeks. Diagnostic test waiting times Percentage of our patients waiting over six weeks at the end of the quarter Our NHS Constitution Commitment The NHS Constitution sets out the rights of an NHS patient. These rights cover how patients access health services and the quality of care they will receive. Patients’ rights under the NHS Constitution and our performance against these indicators, is detailed below: Waiting Lists and Waiting Times Referral to treatment times for non‐urgent consultant‐led treatment Percentage of our inpatients waiting no more than 18 weeks from referral During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 90 90.4 89.9 91.5 89.6 90.4 During the year 1,871 people (9.6%), from a total of 19,467 people, who received planned inpatient treatment, had waited more than eighteen weeks. Percentage of our patients not requiring admission but receiving treatment within 18 weeks During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 95 99.5 99.2 99.1 98.9 99.2 During the year 625 people (0.8%), from a total of 75,262 people, who received treatment and 20 During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 1.00 0.28 0.16 0.65 0.49 0.27 NHS South Tees CCG has achieved this indicator in each month April 2013 – February 2014. During the year 90 people (0.1%), from a total of 33,054 people, who required a diagnostic test, had waited more than six weeks. Cancer Waiting Times Maximum two week wait for initial outpatient appointment for our patients referred by a GP urgently with suspected cancer During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 93 96.2 98.4 95.9 95.5 96.5 During the year 260 people (3.5%), from a total of 7,442 waited more than two weeks for an oupatient appointment when referred by their GP urgently with suspected cancer. Strategic Report: Performance Maximum two week wait for initial outpatient appointment for our patients referred urgently with breast symptoms where cancer was not initially suspected During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 93 97.2 98.1 96.5 97.9 97.9 During the year 30 people (2.1%), from a total of 1,455 people, who were referred urgently for an outpatient appointment with breast symptons waited more than two weeks. Maximum 31 day wait from diagnosis to first definitive treatment for all cancers During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 96 98 100 99.3 98.4 98.9 During the year 17 people (1.1%) from a total of 1,511 people, who were diagnosed with cancer waited over 31 days for treatment to commence. Maximum 31 day wait for subsequent treatment where that treatment is a course of radiotherapy During 2013‐14 Jun Sep Dec Mar 13‐14
Target % % % % % % 94 97.3 97.3 97.3 100 98.3 During the year 9 people (1.7%), from a total of 518 people, who were diagnosed with cancer waited over 31 days for radiotherapy to commence. Maximum 31 day wait for subsequent treatment where that treatment is surgery During 2013‐14 Target Jun % % 94 96.1 Sep % 95 Dec % 100 Mar 13‐14
% % 96.4 98.3 During the year 5 people (1.7%), from a total of 296 people, who were diagnosed with cancer waited over 31 days for surgery to commence. Maximum 31 day wait for subsequent treatment where that treatment is an anti‐
cancer drug During 2013‐14 Target Jun Sep % % % 98 100 98 Dec Mar 13‐14
% % % 100 100 99.4
During the year 3 people (0.6%), from a total of 505 people, who were diagnosed with cancer waited over 31 days for drug treatment to commence. Maximum 62 day wait from urgent GP referral to first definitive treatment for cancer During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 85 87.5 83.9 95.5 90.6 87.5
During the year 101 people (12.5%), from a total of 809 people, who were diagnosed with cancer waited over 62 days for treatment to commence following urgent referral from their GP. Maximum 62 day wait for first definitive treatment following a consultant’s decision to upgrade the priority of the patients (all cancers) During 2013‐14 Target Jun Sep % % % 85 66.7 85.7
Dec Mar 13‐14
% % % 100 100 92.7
During the year 3 people (7.3%), from a total of 41 people, who were diagnosed with cancer waited over 62 days for treatment to commence following a consultant’s decision to upgrade the priority of the patient. 21 Strategic Report: Performance Maximum 62 day wait from referral from an NHS screening service to first definitive treatment for all cancers During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 90 100 100 88.9 100 95.8
During the year 4 people (4.2%), from a total of 96 people, who were diagnosed with cancer waited over 62 days for treatment to commence following referral from an NHS screening service. Not reaching our target is known as a ‘breach’. Where breaches have arisen an action plan for continuous improvement has been developed including the review of each breach to identify any common themes that need to be explored. In addition to this, the hospital is working collaboratively to try and understand cancer pathways further to try and ascertain where changes are required to make a patient’s journey as efficient as possible. Ambulance Response Times The population of NHS South Tees CCG is predominantly served by the North East Ambulance Service; the national standards have been achieved consistently during 2013/14 at South Tees level and work continues to ensure that equitable service is available across the whole locality. Urgent calls resulting in an emergency response arriving within 8 minutes During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 75 80.8 84.0 81.0 78.9 80.76
During the year 3803 people (19.2%), from a total of 19,770 people, who required an ambulance urgently because their condition was considered immediatley life threatening waited over 8 minutes for the ambulance to arrive. 22 Urgent calls resulting in an emergency response arriving within 19 minutes During 2013‐14 Target Jun Sep Dec Mar 13‐14
% % % % % % 95 97.7 98.3 97.0 96.4 97.5
During the year 501 people (2.5%), from a total of 19,721 people, who required a fully equipped ambulance to attend urgently but did not have a condition considered immediately life threatening waited over 19 minutes for the ambulance to arrive. Mixed Sex Accommodation (MSA) Breaches Number of our patients sharing sleeping accommodation, bathroom and toilet facilities with people of a differing sex During 2013‐14 Target Apr‐ Jul‐ Oct‐ Jan‐
13‐14
Jun Sep Dec Mar 0 0 0 1 0 1 During the year one of our patients shared sleeping accommodation, bathroom and toilet facilities with people of the opposite sex. This breach was outwith the control of the CCG as it occurred during ‘out of area’ treatment for a local patient in another part of the country. Mental Health ‐ The Care Programme Approach Proportion of people under adult mental health specialties followed up within seven
days, where the service has assessed patient needs and planned the ways to meet them. During 2013‐14 Apr‐ Jul‐ Oct‐ Jan‐
Target
13‐14
Jun Sep Dec Mar % % % % % % 95 100 89.5 97.1 96.7 98.1
In eleven of the twelve months of the year 95% of people who were discharged from inpatient mental health services were seen by a mental health professional within seven days. However, in the months of April, July, September, Strategic Report: Performance December and March one or more people were not seen within seven days. There was a breach of this 95% target in September 2013 as two patients had to rearrange their appointments. Health Care Acquired Infections Cases of methicillin‐resistant staphylococcus aureusis (MRSA) reported During 2013‐14 Apr‐ Jul‐ Oct‐ Jan‐
Target 13‐14
Jun Sep Dec Mar 0 0 0 0 2 2 During the year two of our patients contracted MRSA in one of our commissioned services. We did not achieve this target. Cases of clostridium difficile reported During 2013‐14 Apr‐ Jul‐ Oct‐ Jan‐
Target 13‐14
Jun Sep Dec Mar 54 14 10 15 20 59 During the year a total of 59 of our patients contracted clostridium difficile in one of our comissioned services. We did not achieve this target. Quality Premium The Quality Premium is intended to reward CCGs for improvements in the quality of the services that they commission and the associated improvements in health outcomes and reduction in inequalities. The quality premium awarded in 2014/15 will reflect the quality of the health services commissioned by them in 2013/14 and is based on four national measures and three local measures. The total payment for a CCG based on performance against the national and local measures will be reduced if commissioned services do not meet the NHS Constitutional rights or pledges for patients: 

Referral to treatment (incomplete waiting times) A&E 4 hour wait 

Cancer 62 day wait 8 minute response for urgent ambulance calls The total amount possible for CCGs to receive in achievement of the Quality Premium will be £5 per patient in the population, according to the same formula as the payment of the running cost allowance of the organisation. For us, this amounts to an award of up to £1,369,550. The following information highlights the indicators against which the quality premium will be determined and our forecast of the outcome. Performance against National Indicators Preventing people from dying prematurely 12.5% of premium The overall aim of this indicator is to reduce premature mortality. This aim is shared between the NHS and public health frameworks. The contribution that can be delivered by the NHS is best measured by potential years of life lost from causes considered amenable to healthcare. As at March 2014 Preventing people from dying prematurely Achieved
The Office of National Statistics define amenable mortality as “A death is amenable if, in the light of medical knowledge and technology at the time of death, all or most deaths from that cause (subject to age limits if appropriate) could be avoided through good quality healthcare”. The methodology for calculating Preventable Years of Life Lost rate uses the average age‐
specific period life expectancy for each five‐year age band for the relevant calendar year (13‐14) as the age to which a person in that age band who died from one of the amenable causes might have been expected to live in the presence of timely and effective health care. We are forecasting to achieve this indicator but published data will not be available until autumn 2014. 23 Strategic Report: Performance Enhancing quality of life for people with long term conditions 25% of the premium Good management of long term conditions requires effective collaboration across the health and care system to support people in managing conditions and to promote swift recovery and reablement after acute illness. The CCG will achieve this part of the quality premium if the Indirectly Standardised Rate of avoidable emergency admissions is lower or the same in 2013/14 compared to 2012/13 or the Indirectly Standardised Rate of admissions in 2013/14 is less than 1,000 per 100,000 population. The data is extracted from the Hospital Episode Statistics system. This indicator is a composite measure of:  unplanned hospitalisation for chronic ambulatory care sensitive conditions  unplanned hospitalisation for asthma, diabetes and epilepsy in children  emergency admissions for acute conditions that should not usually require hospital admission  emergency admissions for children with lower respiratory tract infection As at March 2014 Enhancing quality of life for Achieved
people with long term conditions We are forecasting to achieve this indicator but published data will not be available until autumn 2014. Ensuring people have a positive experience of care 12.5% of the premium The Friends and Family Test is a simple, comparable test which, when combined with follow‐up questions, provides a mechanism to identify poor performance and encourage staff to make improvements where services do not live up to the expectations of patients. This leads to a more positive experience of care for patients. 24 The CCG will achieve this part of the quality premium if South Tees Hospitals NHS Foundation Trust has delivered the nationally agreed roll‐out plan to the national timetable, and there is an improvement in average Friends and Family Test scores for acute inpatient care and A&E services between Q1 2013/14 and Q1 2014/15. As at March 2014 Ensuring that people have a positive experience of care Achieved
We are forecasting to achieve this indicator as the Friends and Family scores at STHFT have remained high throughout 2013‐14 but published data will not be available until summer 2014. Treating and caring for people in a safe environment and protecting them from avoidable harm 12.5% of the premium Although the NHS has made significant improvements in recent years in reducing MRSA bloodstream infections and clostridium difficile infections, the rates of reductions in these infections have been greater in the acute sector than for community onset cases (such as those acquired in care homes). Around half the numbers of MRSA and clostridium difficile infections are now community‐onset cases. The CCG will achieve this part of the quality premium if there are no cases of MRSA bacteraemia assigned to the CCG; and clostridium difficile cases are at or below defined thresholds for the CCG. As at March 2014 Treating and caring for people Not in a safe environment and Achieved
protecting them from avoidable harm We have breached our nationally set MRSA target (0 cases) and clostridium difficile target (54 cases) and therefore we will not achieve this indicator. Strategic Report: Performance Local Indicators There are three local measures which were based on local priorities identified in our Joint Health and Wellbeing Strategies. These were agreed between ourselves, local Health and Wellbeing Boards and the Area Team of NHS England. Smoking during pregnancy 12.5% of the premium As at March 2014 Smoking during pregnancy Not Achieved
Our target was to reduce the percentage of pregnant women who smoke to below 13.8%. At 31 March 2014, 23.9% of women who were pregnant were smoking and therefore we have not achieved this indicator. Emergency readmissions within 30 days of discharge from hospital 12.5% of the premium As at March 2014 Emergency readmissions Achieved
within 30 days of discharge from hospital Our target was to reduce the number of emergency readmissions within 30 days of discharge from hospital to below 13.0%. At 31 January 2014, 12.7% of people discharged from hospital were readmitted within 30 days. We are forecasting to achieve this indicator but published data will not be available until autumn 2014. Estimated diagnosis rate for people with dementia 12.5% of the premium As at March 2014 Estimated diagnosis rate for Achieved
people with dementia Our target was to increase the estimated diagnosis rate for people with dementia to 54.5% or above. At 31st January 2014, the estimated diagnosis rate for people with dementia was reported at 73.1%. We are forecasting to achieve this indicator but published data will not be available until summer 2014. 25 Strateegic Repo
ort: Finance Financce Financiaal Performancce 2013‐14 CCG Ressources 2013‐‐14 Less Neet Commission
ned Services Less Neet Administrative Costs Surpluss 2013‐14 £0000
387,3088
377,5922
5,8844
3,8322
Our annual accountss have been prepared unnder a Directiion issued byy the NHS Co
ommissionin g Board under the Nattional Health
h Service Actt 2006 as amended an
nd are set ou
ut on pages 997 to 127 o
of this reportt. Commissioned Servvices 2013‐14 Other Expe
enditure £7.61M
Prescribing £51.53M Non‐N
NHS Servicces £46.044M NHS Services £277.76M NHS Seervices 2013‐‐14 North
h East Ambulaance FT £11..63M Tees, Esk and Wear Vaalleys FT £43.74M North Tees & Harttlepool FT £2.58M
N
M
L l
New
wcastle FT £2.01M
M
L l
Other Providerss £5.72M
South Teess Hospitals FFT £212.08M
M Non NHS Services 2013‐14 Other £1.3
38M Caree Packagges £9.511M Walk In
n and Out of H
Hours £3.344M Commerciall Providers £8.67M
Local
Authorities and Care Homes £23.14M South TTees Hospitaals NHS FT 20
013‐14 Emergen
ncy Care £72.440M Community £33.84M Maternity £6.19M Planned C
Care £75.35M
M 26 Other Services £24.31M We are pleased to report thaat we delivered our financial duties iin 2013‐14. W
We were req
quired to crreate a surpllus of £3.8322 million in th
he year. This amount is carried forwaard as a retaiined surp
plus for the future. We w
were set an adm
ministrative b
budget of £6,,850 million that we underspent by £
£966,000 thiss was investe
ed in com
mmissioned services in 20013‐14. We commission services from
m a range off provviders,  72.4% of our 7
expendituree was with NHS providers p
 13.4% on the
1
e prescribing of primary ccare medicines m
 12.0% with a
1
range of orgganisations o
outside the NHS  2.0% on othe
2
er items incluuding £5.4 m
million on the costs o
of the area’ss residual esttate The costs of servvices provideed by South T
Tees Hospitals NHS Fo
oundation Trrust represented 55%
% of our entirre expenditu re in 2013‐14. Our two other signifiicant provideers are Tees,, Esk and Wear Valleyys NHS Founddation Trust (Me
ental Health a
and Learningg Disabilities) 11.4%, and North East A
Ambulance SServices 3%. Non
n NHS service
es expenditu re includes o
our local auth
horities and ccare homes ‐ 6% of our costs in 2013
3‐14, specificc care packa ges for patie
ents with
h complex care needs ‐ 22.5%, acute a
and com
mmunity care
e provided byy independent secttor organisations ‐ 2.3% and our loca
al walk in ce
entres and out of hours ddoctor servicce ‐ 0.9%
%. Plan
nned care acccounts for 355.5% of our ccosts at Soutth Tees Hosp
pitals NHS Fooundation Trrust; this inclu
udes all day ccases and noon‐emergenccy inpaatients as we
ell as outpatieents and diagnostic servvices like x‐ra
ay and pathoology. Emergency care
e (34.1%) includes accideent and emerrgency as w
well as unplan
nned admisssions. Other services inclu
ude high cost drugs, inte nsive care an
nd high depe
endency unit costs, audioology, wheelchair servvices and other smaller am
mounts of expe
enditure Stra
ategic Reeport: Finance Mental Health with
h other NHS providers, vooluntary secttor orgaanisations an
nd our two Loocal Authorities. Mental Health & Learrning Disabilitties 2013‐14
Specificc Care Packages £3.51M TEWV Paackages £1.69M IAPT £00.75M TEWV IAPT £0.955M Continuing Heallth Care Other £1.36M Con
ntinuing Hea
alth Care 20113‐14 Children’s Conttinuing Health Care
e agreements £1.00M Other £0.1
18M TEWV £41.10M
Expenditure on Men
ntal Health and Learning Disabilitties excludingg Continuingg Healthcare amounteed to £49.4m
m in 2013‐14
4. Tees, Esk aand Wear Vaalleys NHS Fo
oundation Trrust (TEWV) accounted for 83.3%
% of this expe
enditure for nt and Comm
munity services for Childrren, Inpatien
Adults and Older People. Duringg 2013‐14 th ere has been
n significant investment in Child and Adolesceent Mental H
Health Servicces and also commun
nity infrastru
ucture in rela
ation to the 6
Winterb
bourne Conco
ordat . Improvin
ng Access to Psychologiccal Therapiess (IAPT) acccounted forr 3.4% of spe
end. This is aan ‘any quaalified provid
der’ contract and there a re currently six organissations includ
ding NHS, Indepen
ndent Sector and the Voluntary Sectoor who pro
ovide this serrvice for the CCG. Free
e Nursing Care £3.54M Continuing
g Health Care agree
ements £14.69M 76%
% of Continuing Health Caare costs rela
ate to fullyy funded and
d shared caree packages w
with our two Local Autho
orities. This inncludes paym
ments to care
e homes and individual p ackages of ccare for patients with complex needss provided in
n a resid
dential home
e, day care faacility or in a
a patient’s own ho
ome. Fund
ded Nursing Care accounnts for 18% o
of the total annual costt and packagges of care fo
or child
dren equate to 5%. Complexx packages o
of care in botth Mental Heealth and Learrning Disabilities accountted for 10.5%
% of spend. TThe majorityy of these care packages are provided
d by the indeependent sector but a sm
mall number are also pro
ovided by Tee
es, Esk and W
Wear NHS Foundattion Trust. A
A risk share Valleys N
agreemeent with Harrtlepool and Stockton‐onn‐
Tees CCG
G is in place for these complex casess where w
we jointly shaare the total costs for ouur two CCG
Gs. There arre other smaall contracts w
which accouunt for 2.8%
% of our spen
nd. These incclude contra cts 6
The conccordat sets out a programme of action to transform
m services for peeople with learn
ning disabilitiess or autism and mental health conditions orr behaviours described as challenging. 27 Strateegic Repo
ort: Finance Of the £51.53 million we speent on prima
ary care dicines in 201
13‐14 the topp twenty cattegories med
acco
ount for 64.5
5% of the tottal cost. Top 20 Medicine Caategories 20
013‐14 ds
Corticosteroid
(Respiratoryy)
£4.058M Analgesics
£3.991M Drugs U
Used In Diabetees
£3.963M Antiepileptics
£3.072M Oral Nutritio
on
£2.301M Bronchodilato
ors
£2.227M Antid
depressant Druggs
£1.938M The CCG populattion has a higgh prevalencce of onic respirato
ory disease, heart diseasse and chro
diab
betes. This m
means that m
medicines use
ed to treat these cond
ditions accouunt for significant portions of the top 20 meedicines cate
egories. prop
The highest spen
nding categoory (Corticosteroids, piratory) inclludes mainlyy inhalers use
ed in the Resp
treatment of Astthma and Chhronic Obstru
uctive Pulm
monary Disea
ase. Bronchoodilators (e.gg. Salb
butamol) used to relieve bbreathing difficulties are also a high spend area. Drugs Fo
or Genito‐Urinary
D
Disorders
£1.359M
Nitrates, calcium‐chann
nel
blockkers & other…
£1.241M
An
ntibacterial Druggs
£1.070M
Lipid‐R
Regulating Druggs
£1.070M
Wound
d Management &
oth
her Dressings
£0.913M
Antticoagulants An
nd
Protamine
£0.886M
Hyperteension and Heaart
Failure
£0.820M
Antisecretoryy
Drugs+Mucossal…
Sign
nificant work is ongoing aaround impro
oving the nutrition of patients, in pparticular in the erly. Malnutrition can leaad to more hospital elde
adm
missions, long
ger stays in hhospital and more heallthcare needs in the com
mmunity. Thiss means thatt more patien
nts are givenn food supple
ements to help improve their healthh. The increassing use pecial food supplements s in the treatment of of sp
patients with he
ead and neckk cancers also
o conttributes to th
he spend on oral nutritio
on. Therre have been
n significant price increasses for som
me commonlyy used pain kkillers (analge
esics) and medicines w
which treat ddepression. T
This issue has contributed to a high speend in both tthese egories. cate
£0.810M
Laxativees
£0.742M
Catheteers
£0.708M
Thyroid
d And Antithyro
oid
Drugs
£0.701M
Drugs Used In Psychosees
& R
Rel.Disorders
£0.678M
Drugs Ussed In Rheumattic
Diseeases & Gout
£0.662M
We have worked
d in collaboraation with So
outh Teess Hospitals N
NHS Foundat ion Trust to develop and implement a
a recommennded list of dressings and wound care products foor all nursing staff to use. This list includes those pproducts tha
at have the best clinical evidence forr treating patients n how to treaat wounds and guidance on
effectively. 28 Strategic Report: Finance national introduction of the ‘Better Care Fund’ during the two years between April 2014 and March 2016 will also redirect funds into integrated care services and away from hospital care. There will be increases in funding for community, primary and social care services, whilst funding for hospital based services remains flat. Financial Plans We have developed a five year financial plan for the years 2014‐19 in line with NHS England’s guidance and advice. This work has been supported by demographic models supplied by our commissioning support unit and our own commissioning intentions. Our demographic modelling expects that there will be continued growth in demand for services of 1% per year. Additional factors such as technological change will add further growth of 1% per year for acute services. Growth in continuing health care packages has been modelled at 3% per year and prescribing growth is forecast at 4% per year. Summary Planned Expenditure 2014‐19 £450
1% Surplus
£400
£350
Millions
£300
£250
Other Services
The national tariff setting process has a significant effect on our future plans. The main trend is expected to be a continuing reduction in tariffs paid to our providers for services that are covered by the national payment by results mechanism. These reductions are based on the expectation that NHS providers will deliver 4% efficiency savings in each of the five years. Primary Care
including
prescribing
Intergated and
Continuing Care
£200
£150
£100
£50
Community
Health Services
Mental Health &
Learning
Diabilities
Acute Hospital
Services
Year 2014‐15 2015‐16 2016‐17 2017‐18 2018‐19 £‐
The graph above summarises our financial plans for the period 2014‐2019. We have received confirmed funding allocations for 2014‐15 and 2015‐16. In line with other CCGs in our region we have assumed funding growth of 1.7% per year for 2016/17 until 2018/19. Overall our expenditure per head of population will rise by 7.6% during the five years. The overall strategic direction for this period will be the development of services outside of the hospital setting in line with our care closer to home programme and IMProVE project. The Net Tariff Change ‐1.50% ‐1.60% 0.40% ‐0.60% ‐0.70% The tariff changes in 2015‐16 and 2016‐17 are designed to cover changes to the employer national insurance costs as national pension schemes are amended. In our plans we have not assumed that we will receive additional funding to cover the cost of pension changes. Savings and Investments In order to deliver the requirements of our own commissioning intentions, the NHS Outcomes Framework, the introduction of the Better Care Fund and the IMProVE programme we need to implement a combination of savings and new 29 Strategic Report: Finance The National Outcomes framework commits the CCG to allocate an amount equivalent to £5 per head of population to invest in primary and community care in 2014‐15. This is expected to be self‐funding by reducing emergency admissions. Our commissioning intentions include supporting the running costs of the Rapid Response Service, Integrated Community Care Team and chronic obstructive pulmonary disease rehabilitation services. In addition £1.2M is to be invested in the initial stages of the Better Care Fund for 2014‐15. In line with the current two year agreement with Mental Health and Learning Disability providers, funds released by tariff reductions will be protected to maintain parity with other services. It is anticipated that these funds are available to support repatriated care packages as part of ‘Winterbourne’ reviews. The CCG is also now funding the falls service and weight management services no longer commissioned by public health. Other investments are linked to savings schemes. 7
Emergency admissions to hospitals: managing the demand http://www.nao.org.uk/wp‐
content/uploads/2013/10/10288‐001‐Emergency‐
admissions.pdf 30 Management Costs 2014‐19 Millions
investments. The most critical component of the programme is the requirement to find savings in acute care that will support the development of the Better Care Fund. In our plans we are looking to resource £6.7 million of the £11.5 million target from savings in emergency acute care, the balance to be funded from the growth in our allocation. Central to this will be the development of our Urgent Care Strategy and IMProVE programme reducing the level of emergency admissions. Nationally our CCG has the fourth highest emergency admission rate per 1000 population in England7. £7.000
£6.800
£6.600
£6.400
£6.200
£6.000
£5.800
£5.600
£5.400
Our allowance for management costs has been set at £6.8 million for 2014/15 followed by a 10% reduction in 2015/16 when the allocation will be £6.1 million. During the next five years our management cost per head of population reduces by 13%. Strategic Report: Engagement Research and Innovation We are committed to delivering on our duties regarding both research and innovation and have continued to develop our approach throughout our first year. We have appointed a Clinical Lead for Research and Development, and a Clinical Lead for Education; together we are developing a Research and Innovation Strategy. The strategy will establish the foundations for our organisational culture and ways of working which will enable us to encourage and nurture research and innovation across our membership and with our commissioned service providers and partners. Most importantly it will ensure local people benefit from our contribution to, and implementation of evidence. Supporting our ambition to continuously improve services and the health outcomes for local people is an Innovation and New Ways of Working procedure. Developed with one of our GPs, this process has been designed to enable our membership, as well as existing and new providers to share ideas and proposals with us. Our clinicians critically appraise the evidence, review the initiative within the context of our current and future commissioning intentions and then make a recommendation whether to implement the proposal. An example of this is our investment in a Cardio Pulmonary Exercise Testing service ‐ a non‐invasive and reliable measure of a person’s ability to withstand a surgical procedure and therefore reduce adverse effects and improve patient experience. We are active partners in national and local networks such as the Academic Health Sciences Network, clinical senates and clinical research networks as well as supporting research activity in our area. A number of our member practices are also research practices, actively supporting research priorities and patients volunteering to participate in clinical research. Our Quality in Primary Care Workstream has a number of programmes linked to research, innovation and evidence. The group is leading work focussed on the implementation of NICE8 guidance and the translation of the University of Glasgow’s ‘Deep End’ work for GP practices 8
National Institute for Health and Care Excellence delivering services to people living in some of the most deprived areas. Sustainability The environment around us is important and we understand the effect it can have on people’s everyday lives. Access to green spaces and a sense of community are some things we know have a positive impact on people’s wellbeing. We have a Governing Body lead for sustainability and a Sustainable Development Strategy. The strategy sets out the actions we will take to deliver not only our legal duties regarding sustainability, but also our responsibilities as part of the South Tees community as commissioner of a vast range of NHS services and as a local employer. For example, where possible and proving good value for taxpayer’s money we use local organisations to supply our business services; we ‘reduce, reuse and recycle’ where we can; and we car share and promote active travel. We are an organisation with a small number of staff and in our first year have worked to embed sustainable principles in our work; of course there is more we can and will do. Assessment against NHS Sustainable Development Unit criteria Policy Information Does your organisation have a current Board‐approved Sustainable Development Management Plan (SDMP) or Carbon Reduction Management Plan (CRMP)? Was the SDMP reviewed or approved by the board in the last 12 months? Does your organisation have a healthy or green transport plan? Does your organisation promote healthy travel? Do your commissioning, tendering and procurement processes include:  An assessment of the environmental impacts?  An assessment of the social impacts?  A consideration of the suppliers' sustainability policies? Are you in a strategic partnership with other organisations on sustainability? Does your organisation use the Good Yes No No Yes No Yes No Yes No 31 Strategic Report: Engagement Corporate Citizenship (GCC) tool? Does your organisation promote Yes sustainability to its employees? Do you use eClass for procurement? Yes Performance Information Does your organisation have its own No carbon reduction target? Is there a Board Level lead for Yes Sustainability on your Board? Does your board consider sustainability No issues as part of its risk management process? No Does your board approved plans address the potential need to adapt the delivery of your organisation's activities and organisation's infrastructure as a result of climate change and adverse weather events? We recognise our legal duties regarding sustainability however in our first year, like other CCG across the country we have been unable report on all aspects of our duties such as carbon reduction, utility consumption and waste. Our partner, NHS Property Services will support us with this work in future years. Plans for Engagement Listening to local people Our vision is to improve health together and to achieve this, good communication is vital. Active engagement and involvement is a fundamental part of the process that enables us to identify the health priorities and service needs of people living locally. It helps ensure that we are able to commission high quality services that meet the needs of local people and provide the best possible quality of care. At the same time this helps to optimise effective spending of public money and develop our relationships. and the public to share their views on the NHS and importantly what we needed to do collectively to ensure it is sustainable and fit for purpose for the future. In addition to our ongoing engagement with patients and the public and a dedicated public event, we encouraged people to share their thoughts as part of Call to Action via our website. Our partners kindly helped us raise awareness with their networks through a series of ‘Tweets’. Our Life Store team also discussed the Call with a number of people in their busy town centre location. We’d like to thank all those who took the time to share their thoughts on our NHS, both nationally and locally. In addition to contributing to the national exercise we are listening to what people tell us and we are using this to shape our future plans. Commissioning Priorities for 14/15 This year we shared our proposed commissioning plans for 14/15 in a number of ways ‐ with our membership and also with the public by publishing them on our website and sharing them at a public event. Partners such as Healthwatch also held events to work through them with their members and networks and this was hugely beneficial for us. Reflecting on the feedback however we have learned, and will be sure to engage more widely and much earlier when we start to talk about our plans for the year ahead. Reflections on 13/14 engagement The future of the NHS – A Call to Action This year the importance of engaging with local communities has had a national profile through the NHS’s big conversation – the Call to Action. We were very much a part of this conversation and asked our member practices, our partners 32 Dr Ali Tahmassebi at our public event seeking people’s thoughts on the Call to Action and our commissioning plans for the year ahead Strategic Report: Engagement Hearing what matters most to the vulnerable and the elderly Our most transformational initiative is our IMProVE programme. This work centres on improving care for the vulnerable and elderly delivering health and social care services that are integrated and proactive for people to ensure they are receiving care in the most appropriate setting, as close to home as possible supporting their health and wellbeing. Many people rely on health and social care to keep them as well as possible and help maintain their independence. With an ageing population who are living longer often with a long term condition such as chronic obstructive pulmonary disease it is vital we have effective services in place. We commissioned Carers Together, an independent organisation for carers, to talk openly with around 350 local people on our behalf about what they want from local services and what they think we should do to make improvements where needed. This included talking to people in care homes. Whilst the majority thought services were organised well to some degree, many have identified ways in which health and social care services need to improve:  Better collaboration and co‐ordination across health and social care organisations and between services  More effective and efficient sharing of information  Better communication between providers  Improved liaison with carers  A more holistic view of the family situation This, in addition to five public events we held across South Tees, has informed the development of our case for change to transform care for the vulnerable and elderly and has been shared as part of our public consultation. Engaging with our member practices CCGs are new organisations, with their GP practices as members applying their clinical knowledge and experience of local health services to the commissioning of local health services. Working together across the member practices is essential. Our members have agreed to come together quarterly through our Clinical Council of Members to ensure they are able to shape our work. This meeting also holds the Governing Body to account, including elected GPs for the discharge of the CCG’s duties and is independently chaired by a GP from the membership. Representation is good and we plan to continue to make effective use of these important discussions. Our plans for engagement in 2014/15 Patient, carer and public engagement and involvement is a statutory requirement for Clinical Commissioning Groups however it is also something that we value enormously. We are always impressed by the amount of people who take time to share their views with us in a variety of ways. We hope, however, to increase our engagement for the year ahead and plan more creative ways of seeking people’s experience of NHS services. Key elements of the CCG engagement framework for the year ahead include: Seldom heard groups and communities We will focus on working with a range of communities that have been identified as being under‐represented in relation to engagement or involvement in commissioning decisions. Initially, this will include children and young people and people from black and minority ethnic communities. We also hope to engage with people with disabilities, including physical disabilities and learning disabilities to understand their experience of health services and their thoughts on how services could be improved. We plan to work with key partners to ensure we reach as many people as possible. 33 Strateegic Repo
ort: Enga
agementt Public eevents Public evvents provid
de a valuable mechanism for meetingg and engagin
ng with locall populationss. In this wayy we can devvelop and ma
aintain on‐gooing dialoguees with local groups and communitie s. We will establish a sseries of public events d to reach ou
ut to a wide range of peoople. designed
This will include thosse who we consider to b e seldom heard or und
der‐represen
nted in relatiion to comm
missioning deecision‐making. enable people to
o get involveed and have their say about local commissioning. Website Our website hass recently beeen re‐develo
oped to makke it more acccessible andd provide info
ormation about what we d
do and how to get involvved. The on our site acts as a keyy source of innformation o
engaagement acttivities and w
will be used ffor polls and on‐line quesstionnaires tto seek wider views. Twittter GP Patiient Particip
pation Grou
ups Most meember practices have patient participaation groupss which meett regularly orr commun
nicate by em
mail. While grroups have bbeen establish
hed for the p
purpose of su
upporting practice improvemeents, we are a
also able to discuss m
matters relatting to comm
missioning annd we are kkeen to engaage and involve PPGs moore. We are developing our use oof social med
dia to al people. Yoou can follow
w us engaage with loca
@So
outhTeesCCG
G Life
e Store Hea
alth advice in the heart
rt of the com
mmunity We work closelyy with Pioneeering Care Parttnership who
o manages thhe Life store,, a health advice an
nd informatioon service in Middlesbrough’s shopping ccentre on our behalf. My NHSS My NHS is an online membership database, designed
d to encouraage people to
o take an interest and get invo
olved in local commissionning ns. decision
In particcular, it has b
been develop
ped as a mechanism to allow
w those who m
may find it difficult to get involvved in more traditional w
ways, for exam
mple via meeetings or grou
ups, to have
their sayy. This mightt include young people, tthose in full‐tim
me employm
ment, shift w
workers or peeople with fam
mily or other commitmen
nts. We will continue to use this metthod of engagem
ment and willl continuallyy strive to expand its membersship and our content to 34 The Life Stoore in Middle
esbrough’s Mall shopping centre. Ope
en six days a week, it provvides a range of health advice an
nd informatioon and connects the wellbeing public to sources of expert hhealth and w
adviice and supp
port. The Lifee Store’s team
m of qualified health trainers deliiver high qua
ality health and wellb
being supporrt for South T
Tees resid
dents throug
gh ad‐hoc addvice, classes and one to one sessiions. Strategic Report: Engagement 2014 AGM Our Annual General Meeting (AGM) will be an opportunity to update our members, the public and our partners on the changes to the NHS and share our vision for the local population of South Tees, including our work to date and our proposed commissioning intentions for 2015/16. In the next 12 months we want to:  Further develop the engagement with our practices and we will be encouraging active support and involvement from our wider membership. This will be done by developing an understanding of our clinicians’ speciality areas of interest.  Develop patient involvement, ensuring as a priority regular patient input to our key areas of work e.g. stronger practice Patient Participation Groups.  Seek feedback on local issues, ideas for improvement, problems and things that are working well.  Develop a process for frontline practice staff to ensure patient feedback reaches us by gathering day‐to‐day patient feedback.
35 Strategic Report: Partnership Working Partnership Working Our vision is ‘improving health together’ and we have a strong commitment to developing meaningful partnerships with local organisations to ensure we collectively deliver excellent services for the people of South Tees. This philosophy is driving our transformational work with the vulnerable and the elderly, ensuring the health and social care system works collaboratively and seamlessly without duplication, gaps and bottlenecks. We have also been active members of a multi‐agency approach to managing the demand for services throughout the winter months and this year we have experienced the benefits of our planned approach guided by learning from previous years. We have been working hard at developing partnership approaches across the local health and social care economy, including patient groups and the voluntary sector, to ensure that the needs of our patient population are appropriately represented. We work in partnership with local NHS Trusts, our local authorities as well as local voluntary sector organisations and community groups including Healthwatch to identify the needs of the diverse local community we serve to improve health and healthcare across South Tees. Our commissioning support service provider is also a key partner. We seek the views of patients, carers and the public through individual feedback, consultations, working with other organisations and community groups, attendance at community events and engagement activity including patient surveys and focus groups. Health and Wellbeing We are active partners in our local Health and Wellbeing Boards; we have one in Middlesbrough and one in Redcar and Cleveland and together we have developed Health and Wellbeing Strategies for local people. We have ensured that our plans across the partnership are developed jointly, or complement each other as far as possible to deliver the best possible health and wellbeing opportunities and services across the South of Tees. 36 We have not only attended the Boards themselves, we have also taken a role in the delivery groups which are focussed on making the ambitions set out in our Health and Wellbeing strategies a reality for patients and the public. This includes work with children and young people, older people, and carers – and of course our IMProVE programme ensuring joined up care supporting the vulnerable and elderly. We have also been working together on the wider public health agenda focusing on preventative work such as promoting screening enabling early detection of ill‐health, and supporting self‐management so people can look after their own health. We have also been reviewing our Life Store, to ensure it continues to support the delivery of our health and wellbeing plans and offers practical support for people wanting to improve their wellbeing. Our vision for health and wellbeing is far reaching and we will remain focused on delivering the strategies for years to come. We look forward to continuing to work with our partners throughout 2014/15 delivering the next phase of our ambition for health and wellbeing. Working together to transform Better Care Fund In June 2013 the Government announced the ‘Better Care Fund’ which is a budget to improve the way health services and social care services work together, focussing initially on services for older people and people living with long term conditions. The Better Care Fund is considered a real opportunity for change, streamlining the care patients receive with a greater emphasis on quality of life and wellness; and more service provision in the community with less reliance on hospitals. Along with both local authorities we have developed initial two year plans. The plans are in line with our vision for improving care for the vulnerable and elderly (IMProVE Programme). They include:  The development of a single point of access for health and social community services – making it easier for patients Strategic Report: Partnership working 

and health professionals to access services Supporting independence – investing more in reablement services which support people to regain independence following a crisis or hospital episode Further development of carers’ services The plan has been informed by the views of patients, service users, carers and the people who work with them. Working with the voluntary and community sector We know that the voluntary and community sector has knowledge, resource, relationships and experience that we do not have. Over the last year we have been building robust relationships with our VCS organisations, working closely with Middlesbrough Voluntary Development Agency and Redcar and Cleveland Voluntary Development Agency. We recognise the vital role voluntary and community based services play in supporting local people and as a result we established our first Community Innovations Fund. We asked local community based organisations to submit innovative applications aimed at improving the health and wellbeing of people from across Middlesbrough and Redcar and Cleveland. We received over 60 applications which we then shortlisted with the help of a patient reference group and partners, we awarded over two hundred thousand pounds for new and established services offering innovative ways of supporting people. These services included a home from hospital service, preventing relationship problems, resilience for young people experiencing mental health problems, a volunteer scheme and alcohol abstinence initiative. A full list of the successful projects can be found on our website www.southteesccg.nhs.uk Dr Vaishali Nanda launches the Community Innovation Fund with members of the Voluntary Development Agency Health and Social Care Forum in Middlesbrough Amanda Hume Chief Officer and Accountable Officer for NHS South Tees CCG 6 June 2014 37 Members Report Members Report The members of NHS South Tees CCG are Practice 38 Location
Locality
Albert House Low Grange Health Village, Middlesbrough Eston Bentley Medical Practice Redcar Primary Care Hospital, Redcar Langbaurgh Borough Road and Nunthorpe Medical Group Borough Road, Middlesbrough Middlesbrough Brotton Surgery Alford Road, Saltburn Langbaurgh Cambridge Medical Group Cambridge Road, Middlesbrough Middlesbrough Coatham Surgery Coatham Health Village, Redcar Langbaurgh Coulby Medical Practice Cropton Way, Middlesbrough Middlesbrough Crossfell Health Centre Berwick Hills, Middlesbrough Middlesbrough Discovery Practice Cleveland Health Centre, Middlesbrough Middlesbrough Erimus Practice Cleveland Health Centre, Middlesbrough Middlesbrough Eston Grange Health Centre Low Grange Health Village, Middlesbrough Eston Eston Surgery Low Grange Health Village, Middlesbrough Eston Fulcrum Medical Acklam Road, Middlesbrough Middlesbrough Garth Surgery Rectory Lane, Guisborough Langbaurgh Haven Medical Centre Harris Street, Middlesbrough Middlesbrough Hemlington Health Centre Viewley Centre, Middlesbrough Middlesbrough Hillside Practice Windermere Drive, Skelton Langbaurgh Hirsel Medical Centre North Ormesby Health Village, Middlesbrough Middlesbrough Huntcliff Surgery Bath Street, Saltburn Langbaurgh Kings Medical Centre North Ormesby Health Village, Middlesbrough Middlesbrough Lagan Surgery Kirkleatham Street, Redcar Langbaurgh Langbaurgh Medical Centre Coatham Health Langbaurgh Linthorpe Surgery Linthorpe Road, Middlesbrough Middlesbrough Manor House Surgery Braidwood Road, Middlesbrough Eston Marske Medical Centre Hall Close, Marske by the Sea Langbaurgh Martonside Surgery Martonside Way, Middlesbrough Middlesbrough Newland Medical Practice Borough Road, Middlesbrough Middlesbrough Normanby Medical Centre Low Grange Health Village, Middlesbrough Eston Oakfield Medical Practice North Ormesby Health Village, Middlesbrough Middlesbrough Park Avenue Surgery Park Avenue, Redcar Langbaurgh Park End Clinic Overdale Road, Middlesbrough Middlesbrough Park Surgery One Life, Linthorpe Road, Middlesbrough Middlesbrough Parkway Medical Centre Cropton Way, Middlesbrough Middlesbrough Prospect Surgery Cleveland Centre, Middlesbrough Middlesbrough Members Report: Membership Details Practice Location
Locality
Rainbow Surgery Redcar Primary Care Hospital, Redcar Langbaurgh Ravenscar Surgery Redcar Primary Care Hospital, Redcar Langbaurgh Resolution Health Centre North Ormesby Health Village, Middlesbrough Middlesbrough Saltscar Surgery Kirkleatham Street, Redcar Langbaurgh Skelton Medical Centre Byland Road, Skelton Langbaurgh South Grange Medical Centre Trunk Road, Middlesbrough Eston Springwood Surgery Rectory Lane, Guisborough Langbaurgh The Endeavour Practice Cleveland Health Centre Middlesbrough The Green House Surgery Redcar Primary Care Hospital, Redcar Langbaurgh The Village Medical Centre Linthorpe Road, Middlesbrough Middlesbrough Thorntree Surgery Beresford Buildings, Middlesbrough Middlesbrough Westbourne Medical Centre North Ormesby Health Village, Middlesbrough Middlesbrough Woodlands Road Surgery Woodlands Road, Middlesbrough Middlesbrough Woodside Surgery High Street, Loftus Langbaurgh Zetland Medical Practice Windy Hill Lane, Marske Langbaurgh The members of our Governing Body are Mr Peter Race MBE, Lay Member Dr Henry Waters, Chair Dr John Drury, Secondary Care Doctor Mrs Amanda Hume, Chief Officer Mr David Brunskill, Lay Member Dr Mike Milner, GP Member Langbaurgh Locality Further details of the Governing Body members including details of their roles on all committees are contained in the governance statement pages 55 to 57. Dr Vaishali Nanda, GP Member Middlesbrough Locality Lead Dr Nigel Rowell, GP Member Middlesbrough Locality Dr Ali Tahmessebi, GP Member Langbaurgh Locality Lead Dr Janet Walker, GP Member Eston Locality Lead Liz Graham, Acting Executive Nurse From 1 April 2013 until 25 April 2013 Ms Jean Fruend, Executive Nurse From 25 April 2013 Mr Simon Gregory, Chief Finance Officer Dr John Drury, Secondary Care Doctor Mr Peter Race MBE, Lay Member Mr David Brunskill, Lay Member The members of the Audit Committee for the year and the period up to the signing of the accounts were; Registered conflicts of interest are recorded in the remuneration report page 70. Relevant Disclosures Since the end of the financial year the CCG has commenced a public consultation exercise on the future of community hospitals within our CCG’s area. This is part of our overall strategy for Integrated Management and Proactive Care for the Vulnerable and Elderly (IMProVE). Other significant future developments include the implementation of the Better Care Fund. In 2014‐15 an additional £1.2 million is to be invested in developing integrated services in partnership with the Health and Wellbeing Boards of both Middlesbrough and Redcar and Cleveland Local Authorities. This investment is expected to rise to £11.7 million in 2015‐16. The funds are expected to be provided by reductions 39 Members Report: Membership Details in the volumes and costs of emergency hospital admissions. centre Life Store, who has regular meetings with CCG managers. Pension Liabilities Disabled Employees Our pension liabilities are reported within the remuneration report pages 72 to 73, and in the accounting policy note on page 113 of the financial statements in this report. Our Equality Report set out details of our policy in relation to disabled employees on pages 76 to 78 of this report Sickness Absence Data Days lost to sickness are shown in the employee benefits note to the financial statements page 112. Staff sickness absence is managed in line with our policy on Absence Management. Our appointed external auditors are Deloitte LLP; the cost of the work performed by the auditors for 2013‐14 is £104,000. We have not purchased any other services from Deloitte LLP. We certify that the Clinical Commissioning Group has incident response plans in place, which are fully compliant with the NHS Commissioning Board Emergency Preparedness Framework 2013. The Clinical Commissioning Group regularly reviews and makes improvements to its major incident plan and has a programme for regularly testing this plan, the results of which are reported to the Governing Body. Serious Untoward Incidents Disclosure to Auditors There have been no serious untoward incidents in 2013‐14 or since the end of the financial year. Each individual who is a member of the Governing Body at the time the Members’ Report was approved confirms:  So far as the member is aware, that there is no relevant audit information of which the Clinical Commissioning Group’s external auditor is unaware; and,  That the member has taken all the steps that they ought to have taken as a member in order to make them self‐
aware of any relevant audit information and to establish that the Clinical Commissioning Group’s auditor is aware of that information. External Audit Cost Allocation and Setting of Charges for Information We certify that the CCG has complied with HM Treasury’s guidance on cost allocation and the setting of charges for information. Principles for Remedy Our complaints policy, available on the CCG website reflects the Parliamentary Health Services Ombudsman’s Principles for Remedy. Employee Consultation The CCG as at 31 March 2013, only had 11 directly employed staff involved in the administration of the CCG. This has meant that the entire CCG office staff can meet on a fortnightly basis to: 
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Be briefed on any relevant issues Raise any relevant issues Be involved in decisions that directly involve themselves. The scale of the organisation also means that all the office staff have regular contact with the CCG’s Governing Body members. The CCG has an employee working in the Middlesbrough town 40 Emergency Preparedness, Resilience and Response Amanda Hume Chief Officer and Accountable Officer for NHS South Tees CCG 6 June 2014 Accountable Officer’s Responsibilities Statement of Accountable Officer’s Responsibilities The National Health Service Act 2006 (as amended) states that each Clinical Commissioning Group shall have an Accountable Officer and that Officer shall be appointed by the NHS Commissioning Board (NHS England). NHS England has appointed the Chief Officer to be the Accountable Officer of the Clinical Commissioning Group. The responsibilities of an Accountable Officer, including responsibilities for the propriety and regularity of the public finances for which the Accountable Officer is answerable, for keeping proper accounting records (which disclose with reasonable accuracy at any time the financial position of the Clinical Commissioning Group and enable them to ensure that the accounts comply with the requirements of the Accounts Direction) and for safeguarding the Clinical Commissioning Group’s assets (and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities), are set out in the Clinical Commissioning Group Accountable Officer Appointment Letter. Under the National Health Service Act 2006 (as amended), NHS England has directed each Clinical Commissioning Group to prepare for each financial year financial statements in the form and on the basis set out in the Accounts Direction. The financial statements are prepared on an accruals basis and must give a true and fair view of the state of affairs of the Clinical Commissioning Group and of its net expenditure, changes in taxpayers’ equity and cash flows for the financial year. In preparing the financial statements, the Accountable Officer is required to comply with the requirements of the Manual for Accounts issued by the Department of Health and in particular to: 
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Observe the Accounts Direction issued by NHS England, 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 Manual for Accounts issued by the Department of Health have been followed, and disclose and explain any material departures in the financial statements; and, Prepare the financial statements on a going concern basis To the best of my knowledge and belief, I have properly discharged the responsibilities set out in my Clinical Commissioning Group Accountable Officer Appointment Letter. Amanda Hume Chief Officer and Accountable Officer for NHS South Tees CCG 6 June 2014 41 Governance: Governance Statement Amanda Hume Chief Officer Governance Statement The Clinical Commissioning Group was licenced from 1 April 2013 under provisions enacted in the Health & Social Care Act 2012, which amended the National Health Service Act 2006. The Clinical Commissioning Group operated in shadow form prior to 1 April 2013, to allow for the completion of the licencing process and the establishment of function, systems and processes prior to the Clinical Commissioning Group taking on its full powers. As at 1 April 2013, the Clinical Commissioning Group was licensed without conditions. Scope of Responsibility As the Accountable Officer, I have responsibility for maintaining a sound system of internal control that supports the achievement of the Clinical Commissioning Group’s policies, aims and objectives, whilst safeguarding the public funds and assets for which I am personally responsible, in accordance with the responsibilities assigned to me in Managing Public Money. I also acknowledge my responsibilities as set out in my Clinical Commissioning Group Accountable Officer Appointment Letter. I am also responsible for ensuring that the Clinical Commissioning Group is administered prudently and economically and that resources are applied efficiently and effectively, safeguarding financial propriety and regularity. Compliance with the UK Corporate Governance Code Whilst the detailed provisions of the UK Corporate Governance Code are not mandatory for public sector bodies, compliance with relevant principles of the Code is considered to be good practice. This Governance Statement is intended to 42 demonstrate how the Clinical Commissioning Group had regard to the principles set out in the Code considered appropriate for Clinical Commissioning Groups for the financial year ended 31 March 2014. This guidance has enabled a detailed review of Governing Body effectiveness against the following criteria: leadership, effectiveness, accountability, remuneration and relations with stakeholders on a ‘comply or explain’ basis. This review was also supported by a dedicated development session for the Governing Body to review Governing Body compliance with the Code. In particular, having reviewed the effectiveness of our governance framework and arrangements in relation to The UK Corporate Code of Governance, I consider that the organisation complies with the appropriate principles and standards of best practice contained within the guidance on a ‘comply or explain’ basis. I can confirm that the arrangements in place for the discharge of statutory functions have been checked for any irregularities, and that they are legally compliant. The Clinical Commissioning Group Governance Framework The National Health Service Act 2006 states: The main function of the Governing Body is to ensure that the group has made appropriate arrangements for ensuring that it complies with such generally accepted principles of good governance as are relevant to it. Information about the Membership Body and Governing Body, their committees and subcommittees, including membership, attendance records and coverage of their work, is set out on pages 50 to 79 of this report. The Clinical Commissioning Group Risk Management Framework The Governing Body is responsible for determining the nature and extent of the significant risks it is willing to take in achieving its strategic objectives and for maintaining sound risk management and internal control systems. Governance: Governance Statement This is not only the initial year of the CCG, but also a year that has seen large scale changes in the NHS commissioning landscape. Services that were previously commissioned under single Primary Care Trust contracts are now commissioned by multiple bodies with their own distinct responsibilities for commissioning services. This has meant the CCG has to assure itself that contracts identify the correct commissioner as much by service as by registered GP practice. The estate that was previously vested in Primary Care Trusts has been transferred to a new organisation, NHS Property Services Ltd. The CCG has been required to fund the costs of facilities in its area where they exceed the revenues from tenants. This is effectively the same position as the former Primary Care Trusts, but presented in a more transparent manner. In addition the CCG, like most CCGs nationally, has contracted with a commissioning support unit to provide most of its administrative functions. These services are in their own first year of operation and are having to develop their own mechanisms and processes. The Governing Body has established a Governance and Risk Committee, chaired by the Chief Finance Officer as part of its committee structure. This committee provides oversight of our risk management framework Our approach to Risk Management is set out on pages 80 to 81 of this report. The Clinical Commissioning Group Internal Control Framework A system of internal control is the set of processes and procedures in place in the Clinical Commissioning Group to ensure it delivers its policies, aims and objectives. It is designed to identify and prioritise the risks, 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 allows risk to be managed to a reasonable level rather than eliminating all risk; it can therefore only provide reasonable and not absolute assurance of effectiveness. Our internal control framework describing the overarching controls of the CCG including how we maintain a system of information governance and manage our obligations for staff pensions, equality, diversity, human rights and sustainability is set out on pages 82 to 85 of this report. Risk Assessment in Relation to Governance, Risk Management & Internal Control Our approach to risk assessment and a summary of the most significant risks that we face is set out on pages 86 to 88 of this report. None of the risks have been assessed as impacting upon the CCG’s Licence. Review of Economy, Efficiency & Effectiveness of the Use of Resources The key processes that we have applied to ensure that resources are used economically, efficiently and effectively are set out on pages 89 to 90 of this report. Review of the Effectiveness of Governance, Risk Management & Internal Control As Accounting Officer I have responsibility for reviewing the effectiveness of the system of internal control within the Clinical Commissioning Group. Capacity to Handle Risk Our staff are trained and equipped to manage risk in a way appropriate to their authority and duties. Our Risk Management Policy and Strategy sets out our approach and our small management team reviews all risks on a regular basis. Review of Effectiveness My review of the effectiveness of the system of internal control is informed by the work of the internal auditors and the executive managers and leaders within the Clinical Commissioning Group who have responsibility for the development and maintenance of the internal control framework. I have drawn on performance information available to me. My review is also informed by comments made by 43 Governance: Governance Statement the external auditors in their management letter and other reports. The Governing Body Assurance Framework itself provides me with evidence that the effectiveness of controls that manage risks to the Clinical Commissioning Group achieving its principal objectives have been reviewed. I have been advised on the implications of the result of my review of the effectiveness of the system of internal control by the Governing Body, the Audit Committee and the Governance and Risk Committee. These committees reflect on their role each year and amend their terms of reference and membership to reflect changing requirements. The process of maintaining and reviewing the effectiveness of the system of internal control is set out in this report on pages 91 to 92. In addition in sections on the work of the Governing Body and its committees include reflections on how they have developed during the year and what is expected to be improved in the future. Following completion of the planned audit work for the financial year for the Clinical Commissioning Group, the Head of Internal Audit issued an independent and objective opinion on the adequacy and effectiveness of the Clinical Commissioning Group’s system of risk management, governance and internal control. The Head of Internal Audit concluded that: “The purpose of our annual Head of Internal Audit Opinion is to contribute to the assurances available to the Accountable Officer and the Governing Body which underpin the Accountable Officer’s own assessment of the effectiveness of the organisation’s system of internal control. This opinion will, in turn, assist the Accountable Officer in the completion of the Annual Governance Statement. The basis for forming our opinion is as follows: 1. An assessment of the design and operation of the underpinning Assurance Framework and supporting processes; 2. An assessment of the range of individual opinions arising from risk based audit assignments, contained within internal audit risk‐based plans that have been reported throughout the year. This assessment has taken account of the relative materiality of these areas and management’s progress in respect of addressing control weaknesses; 3. Any reliance that is being placed upon third party assurances. The commentary below provides the context for our opinion and, together with the opinion, should be read in its entirety. The design and operation of the Assurance Framework and associated processes The Assurance Framework was inherited from the predecessor PCT and has been further developed in year. Therefore it has existed throughout the year and although it may require some development it is generally ‘fit for purpose’. Risk management processes have been in place throughout the year. The CCG was authorised without conditions and we have found no significant issues with the system of internal control. Furthermore, CCG management assurances indicate no significant issues have occurred throughout the year along with NECS management assertions they are not aware of any significant issues during the year. The range of individual opinions arising from risk‐
based audit assignments, contained within risk‐
based plans that have been reported during the year Our opinion is set out as follows: During the year 2013/14 we have undertaken our work in accordance with the Internal Audit annual plan. In October 2013 we reviewed and refreshed the CCG internal audit plan to ensure the continued provision of effective assurance, which was approved by the Audit Committee. Throughout the year we have reported our findings to the Chief Finance Officer and Chief Officer (and Executive colleagues where applicable). Our internal audit 1. Overall opinion; 2. Basis for the opinion; 3. Commentary. Our overall opinion is that Significant Assurance can be given that there is a generally sound system of internal control, designed to meet the 44 organisation’s objectives, and that controls are generally being applied consistently. However, some weakness in the design and inconsistent application of controls put the achievement of particular objectives at risk. Governance: Governance Statement progress reports to the Audit Committee have set out the areas covered by internal audit work during the year, our results and matters arising. The majority of this work would indicate that significant assurance opinions have, or will be assigned to the majority of the CCG’s systems and processes. There are two audits that we have not have concluded at the time of writing this annual report;  Financial Management & Performance Reporting  Francis II Review We do not anticipate that there will be significant issues arising from these reviews, however, they have not contributed to the overall assurance level provided within this report and will be reported to the Audit Committee in due course. By way of commentary it should also be noted that there have been no ‘no assurance’ final reports issued for 2013/14, nor any ‘limited assurance’ areas. In undertaking our duties we have identified some weaknesses in the design or effectiveness of controls in certain systems. We have reported these issues during the year, and post the year end, however, there are no significant issues that we would specifically bring to the Accountable Officer’s attention for potential disclosure within the Annual Governance Statement.” Where we receive audit reports with significant assurance, we accept the agreed recommendations of Internal Audit to ensure that we continue to develop and refine our controls and processes. Data and business critical models Our approach to data quality, data security and the validation of critical modelling tools is set out in the internal control framework section of this report on pages 83 to 84. Discharge of Statutory Functions During establishment, the arrangements put in place by the Clinical Commissioning Group and explained within the Corporate Governance Framework were developed with extensive expert external legal input, to ensure compliance with the all relevant legislation. That legal advice also informed the matters reserved for Membership Body and Governing Body decision and the scheme of delegation. In light of the Harris Review9, the Clinical Commissioning Group has reviewed all of the statutory duties and powers conferred on it by the National Health Service Act 2006 (as amended) and other associated legislation and regulations. As a result, I can confirm that the Clinical Commissioning Group is clear about the legislative requirements associated with each of the statutory functions for which it is responsible, including any restrictions on delegation of those functions. Responsibility for each duty and power has been clearly allocated to a lead Governing Body member. Directorates have confirmed that their structures provide the necessary capability and capacity to undertake all of the Clinical Commissioning Group’s statutory duties. Conclusion My review confirms that NHS South Tees Clinical Commissioning Group has a generally sound system of internal control that supports the achievement of its policies, aims and objectives. As part of our reflection on the first year we have identified areas where we can improve, we view this as a snagging list for the CCG. Where weaknesses have been identified, actions are being put into place for 2014‐15. Amanda Hume Chief Officer and Accountable Officer for NHS South Tees CCG 6 June 2014 9
Independent review of the arrangements made by SHAs for the approval of registered medical practitioners and approved clinicians under the Mental Health Act 1983. 45 Governance: The Snagging List The Snagging List 2013/14 was the Clinical Commissioning Group’s first year and there are some things that we recognise that we did not get completely right and need to start to fix in 2014/15. Moving forward we commit to ensuring the areas outlined below are addressed and lessons learnt are documented and acted upon where possible to ensure continuous improvement. 46 Governance: The Snagging List We feel it is important to be honest and transparent about the work we do well but also the work that we could improve. We believe that as a commissioner we need to have processes in place to reflect on our performance, continuously review our plans and processes and evaluate the way we utilise our resources. We have identified the areas for improvement; this is not to say to that we have not started work in these areas but we have further to go; and there are a number of recommendations that we will progress throughout 2014‐15. We need to: Patient engagement  Develop initiatives to encourage patient Patients are not just passive recipients of care, involvement in the design, planning and we want to engage patients in their own health, delivery of health services. care and treatment. Throughout 2013/14 we held a number of public  Work with our GPs and other clinicians in secondary care to 'reach out' to less meetings and consulted with voluntary and accessible populations and make them community sector organisations and individuals part of the engagement and involvement via our My NHS database on specific projects process. such as IMProVE but we did not get the uptake or involvement that we would have liked.  Work more closely with voluntary sector This was often due to the tight timescales that colleagues recognising the valuable input we were working to which, when we asked for and resources that they can offer. feedback, left the engagement and involvement of the patients we did liaise with feeling  Understand the experiences that inform tokenistic which in fact it wasn’t. the patients’ perspective of services. We need to work closely with colleagues in We also need to rethink the way in which we our acute hospitals to understand engaged, if we want to involve more people to patients’ experiences. inform our commissioning we need to develop  Be committed to being a listening innovative mechanisms to do this using social organisation and believe that everyone media, working more closely with our local in South Tees has a valuable perspective voluntary community organisations that have that we can learn from. This includes: established groups and contacts within the patients, relatives, carers, independent communities we are trying to reach. providers (GPs, dentists, ophthalmologists and pharmacists), secondary care providers, local authority staff, MPs, friends and patient groups. Further workstream development We need to: We developed a workstream organisational  Work with the experts within the development plan late in the 2013/14 financial commissioning support unit to progress year. We recognise that there is further work to the organisational development plan. be undertaken to ensure we are providing our clinicians with the appropriate skills and abilities to inform their roles within the CCG. 47 Governance: The Snagging List Practice engagement The last 12 months have seen significant change in the relationships between commissioning and general practice. We understand that not all of our practices supported the creation of CCGs but we must now move forward with the architecture as it currently is. We undertook a number of practice visits which were an opportunity for the CCG leadership team to go out and speak to practices to understand their concerns. Of the 49 practices we hoped to see in the 12 months we were unable to visit two. Working with the voluntary sector Though we have made progress within the last 12 months we understand that we need to do more to ensure both the CCG and clinicians working in general practice are able to access, refer and signpost patients to services based in the community. 48 
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We need to; To do this, we need to work with patients, carers, local people, voluntary and community groups and other agencies and, together, build healthier communities which have strong networks Engaging with our practices’ patient participation groups gives us as a CCG essential insight into the experience of the practices’ patients. This will enable us to make informed decisions. Effective engagement will help us to improve health outcomes as well as make the best use of public resources. The CCG wants to make real and sustainable improvements in the health and wellbeing of the people of South Tees. 
We need to; We are working with Middlesbrough Voluntary Development Agency and Redcar and Cleveland Voluntary Development Agency to see how best we can progress this work over the coming year. Governance: Overview Where does NHS South Tees CCG commission health services and which rules apply to it? NHS South Tees CCG is an NHS Clinical Commissioning Group established under provisions enacted in the Health & Social Care Act 2012, which amended the NHS Act 2006. The CCG commissions a range of health services for the population registered with GP practices within the boundaries of both Middlesbrough Council and Redcar and Cleveland Council. We have a constitution based on the Department of Health’s model template. The constitution was reviewed during 2013‐14 to ensure it remained legally compliant and continued to reflect updated guidance. NHS England formally reviewed and approved the changes. A review of our constitution confirms that it complies with the elements of the self‐certification checklist, including;  Specifying the arrangements made by the CCG for the discharge of its functions;  Specifying the arrangements made by the CCG for the discharge of the functions of the Governing Body;  The procedures to be followed by the CCG in making decisions;  The arrangements it has made to secure that individuals to whom health services are being or may be provided pursuant to its commissioning arrangements are involved;  Arrangements made by the CCG for discharging its duties in respect of registers of interests and management of conflicts of interests;  Arrangements made by the CCG for securing that there is transparency about the decisions of the group and the manner in which they are made. The NHS England regulations allow us to amend the constitution on two occasions throughout the year; any changes first being approved by the Clinical Council of Members and the Governing Body. In the intervening period between updates, the CCG experienced an issue relating to the quoracy of the Governing Body when all GP members declared an interest in an item for decision. To ensure continued high levels of governance and probity, the CCG has adopted the use of the ‘emergency powers and urgent decisions’ process provided for in the Constitution. There have been two occasions during 2013‐14 where this process has been used; both of which were reported to the Audit Committee and the Governing Body. In 2014‐15 the CCG intends to review the constitution to ensure that in these circumstances the decision makers can access advice from other clinical experts unaffected by the conflict of interest. What is NHS South Tees CCG’s Governance Structure? The Clinical Commissioning Group has continued to operate with a committee structure which reflects guidance and best practice, including: Quality, Performance and Finance Committee, Governance and Risk Committee, Audit Committee and Remuneration Committee and Funding Panel. Terms of reference have been agreed for these committees which support the organisation in the delivery of effective governance. The organisational structure including key committees is set out below; Quality, Perfomance and Finance
Council of Members
Audit
Governing Body
Governance and Risk
Remuneration
Funding Panel
49 Governance: Overview Committees of the Governing Body Details of the NHS South Tees CCG Governing Body and committee governance structure are set out on page 49. The terms of reference for each of the committees of the Governing Body, which have been approved by the Governing Body are available on the NHS South Tees CCG website www.southteesccg.nhs.uk. Membership and activities of the various committees are summarised on pages 63 to 79 of this report. Provided below is an overview of our key committees. Quality, Performance and Finance Committee Chaired by Dr Ali Tahmassebi Number of Meetings in the year: 6 Role of the Committee The Quality, Performance and Finance Committee has responsibility for overseeing and monitoring the overall performance of the CCG and its contracts. For more information see pages 63 to 64 Audit Committee Chaired by Mr Peter Race MBE Number of Meetings in the year: 5 Role of the Committee The Audit Committee reviews our financial reporting and internal control principles and ensures an appropriate relationship with both internal and external auditors is maintained. For more information see pages 65 to 68 Remuneration Committee Chaired by Mr David Brunskill Number of Meetings in the year: 3 Role of the Committee The Remuneration Committee advises the Governing Body about pay, other benefits and terms of employment for the Chief Officer and other senior staff. For more information see pages 69 to 73 Funding Panel Chaired by a CCG Lay Member Number of Meetings in the year: 12 Role of the Committee The Funding Panel approves the funding of specific treatments in exceptional circumstances working jointly with other CCGs. For more information see page 75 Clinical Council of Members The Clinical Council of Members is established by NHS South Tees Clinical Commissioning Group in accordance with its Constitution, standing orders and scheme of delegation. The Clinical Council of Members is made up of the 49 member practices and is the mechanism through which the member practice representatives come together for collective decision making as a member organisation, ensuring active participation by each practice. The Clinical Council of Members holds our Governing Body to account through communication about the overall performance of the CCG. In line with the Constitution, the Clinical Council of Members determines how it operates; sets the process of appointment and dismissal of Governing Body members through the Nominations Panel; elects GP Governing Body members; considers and approves changes to the Constitution; determines the overarching scheme of delegation; determines delegation of powers to localities and determines any matter in full session of the Council. The Clinical Council of Members has met on three occasions during 2013/14 and the main areas of decision have been  The agreement and adoption of the Clinical Council of Members Terms of Reference  The approval of the CCG’s revised Constitution. Governance and Risk Committee Chaired by Mr Simon Gregory Number of Meetings in the year: 5 Role of the Committee The Governance and Risk Committee is responsible for the development, implementation and monitoring of integrated risk and governance. For more information see page 74 50 Quality in Primary Care One of the most significant opportunities that we have as local commissioners is the opportunity to play an active role in supporting quality improvement in general practice itself. Although we as a CCG do not commission primary care directly, we do have a legal duty to support NHS Governance: Overview England to improve the quality of primary care and it is in our interest as commissioners to achieve this as quality is vital if we are to achieve our wider corporate commissioning objectives. comparative performance data on member practices. Using this tool enables the CCG to work with practices and to understand the narrative behind the data offering peer support to practices. Developing our close relationships with our clinicians has enabled us to encourage innovation and improvement in both general practice but in the broader commissioning of services. We understand that there are wider pressures being placed on primary care which sometimes limits the time that our clinicians can engage with the work of the CCG. We have close relationships with Cleveland Local Medical Committee (LMC) and will support practices where possible Listening to our clinicians we are aware that there is still much work to be done. We recognise that there is still some concern over the roles and relationships of the new organisations including the CCG, commissioning support unit and NHS England. Engagement with localities We are fully committed to engaging with all of our member practices. The Governing Body GP members who are leads for their localities chair locality meetings on a regular basis. In combination with the Council of Members covering all 49 member practices meeting each quarter, there are monthly engagement meetings for all practices either at locality or CCG level. Clinical commissioning is not new; it has a long history involving some success stories and naturally some disappointments. As a CCG we have an opportunity to achieve success through engagement with our 49 member practices. Our mission is ‘Improving health together’; we cannot achieve this if we do not have the support of our local clinical community. We are a membership organisation and this is a new experience for managers and clinicians, but the progress that we have made in the last year is testament to the hard work, cooperation and patience that has occurred through engagement and involvement between the CCG and our members. As a CCG we have taken a supportive approach to work with our practices. We developed within our locality clinical councils a quality support pathway which determines practices that are outliers using Engagement with member practices Listening to and engaging with our clinicians was one of our primary focuses when we were authorised in April 2013. To ensure that practices felt supported and had an opportunity to speak to colleagues in the CCG a schedule of practice visits was planned with our member practices. Though we hoped to visit all 49 within our first year we didn’t quite achieve this but we will be visiting the two practices that we didn’t meet shortly. We have made a commitment to continue these visits each financial year as we have received positive feedback that the visits are welcomed by our practices. Admittedly, initially, there was a mixed response to these visits by some practices but as a CCG we wanted to reiterate that collaboration and joint working is crucial. Practices were, understandably, unsure of what to expect from the newly formed CCG but the practice visits have been an opportunity to demonstrate that, despite the fact that it is still early days, we are developing as a CCG, that we are professionally led and that we are a supportive organisation. The visits were an opportunity to update practices on developments with the CCG, share the CCG priorities and get their feedback on initial ideas regarding future engagement processes and activities. These visits have also started to develop and deepen relationships across the CCG as well as developing processes for communicating and informing all who work in and with NHS South Tees CCG. A table of practice visits is shown over the page. 51 Governance: Overview Practice 52 Address Visited 10 July Albert House Low Grange Health Village, Middlesbrough Bentley Medical Practice Redcar Primary Care Hospital, Redcar
28 November Borough Road and Nunthorpe Medical Group Borough Road, Middlesbrough
2 December Brotton Surgery Alford Road, Saltburn
Cambridge Medical Group Cambridge Road, Middlesbrough
24 October Coatham Surgery Coatham Health Village, Redcar
24 October Coulby Medical Practice Cropton Way, Middlesbrough
9 October Crossfell Health Centre Berwick Hills, Middlesbrough
10 September Discovery Practice Cleveland Health Centre, Middlesbrough
To be visited Erimus Practice Cleveland Health Centre, Middlesbrough
13 November Eston Grange Health Centre Low Grange Health Village, Middlesbrough 18 July Eston Surgery Low Grange Health Village, Middlesbrough 26 September Fulcrum Medical Acklam Road, Middlesbrough
12 September Garth Surgery Rectory Lane, Guisborough
Haven Medical Centre Harris Street, Middlesbrough
Hemlington Health Centre Viewley Centre, Middlesbrough
Hillside Practice Windermere Drive, Skelton
Hirsel Medical Centre North Ormesby Health Village, Middlesbrough Huntcliff Surgery Bath Street, Saltburn
Kings Medical Centre North Ormesby Health Village, Middlesbrough Lagan Surgery Kirkleatham Street, Redcar
Langbaurgh Medical Centre Coatham Health Linthorpe Surgery Linthorpe Road, Middlesbrough 4 October Manor House Surgery Braidwood Road, Middlesbrough
To be visited Marske Medical Centre Hall Close, Marske by the Sea
Martonside Surgery Martonside Way, Middlesbrough
Newland Medical Practice Borough Road, Middlesbrough
Normanby Medical Centre Low Grange Health Village, Middlesbrough 13 August Oakfield Medical Practice North Ormesby Health Village, Middlesbrough 9 January Park Avenue Surgery Park Avenue, Redcar
Park End Clinic Overdale Road, Middlesbrough
Park Surgery One Life, Linthorpe Road, Middlesbrough
Parkway Medical Centre Cropton Way, Middlesbrough
15 July 6 August 23 July 24 October 23 September 23 January 18 July 2 October 11 June 20 September 27 June 22 October 19 November 28 November 24 October 3 July 24 October Governance: Overview Practice Address Visited 12 June Prospect Surgery Cleveland Centre, Middlesbrough
Rainbow Surgery Redcar Primary Care Hospital, Redcar
15 January Ravenscar Surgery Redcar Primary Care Hospital, Redcar
2 July Resolution Health Centre North Ormesby Health Village, Middlesbrough 5 July Saltscar Surgery Kirkleatham Street, Redcar
22 August Skelton Medical Centre Byland Road, Skelton
24 October South Grange Medical Centre Trunk Road, Middlesbrough
12 September Springwood Surgery Rectory Lane, Guisborough
7 October The Endeavour Practice Cleveland Health Centre
25 June The Green House Surgery Redcar Primary Care Hospital, Redcar
25 June The Village Medical Centre Linthorpe Road, Middlesbrough
Thorntree Surgery Beresford Buildings, Middlesbrough
Westbourne Medical Centre North Ormesby Health Village, Middlesbrough 13 September Woodlands Road Surgery Woodlands Road, Middlesbrough
30 September Woodside Surgery High Street, Loftus
Zetland Medical Practice Windy Hill Lane ,Marske
30 September 3 July 12 August 26 November 53 Governance: Governing Body Our Governing Body This body is appointed under the NHS Act 2006; with the main function of ensuring that a Clinical Commissioning Group has made appropriate arrangements for ensuring that it complies with its obligations under the NHS Act 2006 and the generally accepted principles of good governance that are relevant to it. As at 31 March 2014, the Governing Body was made up of 12 members consisting of the Chair and five other GP Members, three Executive Directors, two Lay Members and a Secondary Care Doctor. The six GP members of the Governing Body are elected by the member practices. The Chair is elected from within the six elected GPs by the Governing Body members. The Chief Officer is appointed by NHS England following nomination by the CCG. The other officers, lay members and secondary care doctor are recruited to the Governing Body. Biographical details for each of the Governing Body members in office as at 31 March 2014 are shown on pages 55 to 57 The Lay Members and Secondary care Doctor are each considered by the Governing Body to be independent and free of any relationship which could materially interfere with the exercise of their independent judgement. Who attends Governing Body Meetings? Each Governing Body member is required to attend all meetings of the Governing Body and Committees of which they are a member. In addition, other senior management of the CCG and advisors attend some of the meetings for the discussion of specific items in greater depth. The Governing Body met regularly during the year. There were seven Governing Body meetings held during the year ended 31 March 2014. The attendance record of the Governing Body for 2013‐14 members is shown in the table below. Member Dr Henry Waters, Chair Amanda Hume, Chief Officer Dr John Drury, Secondary Care Doctor Peter Race MBE, Lay Member David Brunskill, Lay Member Dr Janet Walker, GP Member 54 Attended 5/7 6/7 7/7 7/7 6/7 7/7 Dr Ali Tahmassebi, GP Member Dr Mike Milner, GP Member Dr Vaishali Nanda, GP Member Dr Nigel Rowell, GP Member Jean Fruend, Executive Nurse, from 25/04/13 Liz Graham, Acting Executive Nurse, 01/04/13 until 24/04/13 Simon Gregory, Chief Finance Officer 3/7 6/7 6/7 5/7 6/6 0/1 7/7 Two of our early Governing Body meetings were not held in public, but the papers were publicly available. Since that point we have decided that all of our meetings will be held in public, details of the of these meetings are available on our website www.southteesccg.nhs.uk How does the Governing Body operate and how are decisions made? Certain strategic decision making powers are reserved to the Governing Body. The formal schedule of these powers is within the CCG constitution. The principal matters reserved for the Governing Body are set out on page 58. Where appropriate, matters are delegated to a committee that will consider them in accordance with its own terms of reference. Details of each of these committees’ membership and terms of reference are set out on pages 63 to 79 of this report. Day to day operational decisions are managed by the executive group, led by the Chief Officer, Amanda Hume. The Governing Body members and senior managers who regularly attend the executive group meetings are listed on page 79 of this report. Governance: Governing Body Dr Henry Waters Chair Dr Janet Walker GP Member Appointed on 1 April 2013 and will be retiring in the autumn. Appointed on 1 April 2013 and will seek reappointment in October 2015. Key strengths Dr Waters has a specialist interest in Rheumatology and Musculoskeletal Medicine. Dr Waters has also worked in neurology and the Probation and Prison Services and in a community musculoskeletal clinic. Experience Dr Waters has been a GP for 36 years and was a leading figure and board member of Middlesbrough PCT. Other committee membership Member of Executive Group, Remuneration Committee. External appointments Non‐Executive Director of Academic Health Science Network for the North East and North Cumbria, Member of Northern CCG Forum. Key strengths Dr Walker has specialist interests in medicines optimisation, palliative care and children and young people. Dr Walker is passionate about partnership working with other organisations. Experience Dr Walker has been a GP Partner for 15 years and has been involved with the National Medicine Collaborative Programme. Dr Walker was previously a senior figure in the former PCTs. Other committee membership Member of the Quality, Performance and Finance Committee, Funding Panel External appointments Vice Chair of Redcar and Cleveland Health and Wellbeing Board , Tees Medicines Management Committee. Dr Vaishali Nanda GP Member Dr Ali Tahmassebi GP Member Appointed on 1 April 2013 and will seek reappointment in October 2015. Appointed on 1 April 2013 and will seek reappointment in October 2015. Key strengths Dr Nanda has vast understanding of quality in primary care and has specialist interests in gynaecology and obstetrics having led on pathway changes for laparoscopic sterilisation. Experience Dr Nanda qualified as a GP in 2004 and has worked in Middlesbrough since April 2005. Dr Nanda was worked with practice based commissioning in Middlesbrough and was the Vice Chair of the Middlesbrough Pathfinder CCG. Other committee membership Locality Clinical Lead for Middlesbrough, Member of the Quality, Performance and Finance Committee, Chair of Clinical Quality Review Group. External appointments Member of Primary Care Quality Surveillance Group. Key strengths Dr Tahmassebi has a specialist interest in improving quality in primary care, and providing challenge so to ensure that quality is a leading driver for change. Dr Tahmassebi encourages innovation and promotes a culture of joint working between organisations and general practices. He also has extensive knowledge of service redesign. Experience Dr Tahmassebi has been a GP for 14 years and has worked as a Doctor in Middlesbrough and Redcar and Cleveland for over 20 years. Other committee membership Chair of Quality, Performance and Finance Committee. External appointments Director of Slaters Bridge; a social enterprise looking at patients in primary care. Member of the North East Community Health (NECH) social enterprise of General Practices in Langbaurgh. 55 Governance: Governing Body Amanda Hume Chief Officer Jean Fruend Executive Nurse Appointed on 1 April 2013 Appointed on 25 April 2013 Key strengths Mrs Hume has significant experience working within commissioning, workforce development, organisational development and HR. Mrs Hume’s skills include strategic planning and expertise in contracting and performance. Experience Mrs Hume has over 20 years of experience in all sectors of the NHS. Other committee membership Chair of Executive Group, Member of IMProVE Advisory Group, Member of Quality, Performance and Finance Committee. External appointments Member of both Health and Wellbeing Boards, and their executives, Member of Health & Social Care Delivery Partnership (Middlesbrough), Member of Redcar and Cleveland Leadership Forum, Member of Northern CCG Forum. Dr Nigel Rowell GP Member Dr Mike Milner GP Member Appointed on 1 April 2013 and will seek reappointment in October 2015. Appointed on 1 April 2013 and will seek reappointment in October 2015. Key strengths Dr Rowell is the National Clinical Lead in Heart Failure for NHS Improvement and is a GP with a specialist interest in cardiology. Dr Rowell was the founding member of Cardio Vascular General Practitioners and is an undergraduate teacher. Experience Dr Rowell has been a GP in Middlesbrough for 25 years and was a leading figure in the previous PCT and Health Authority. Committee membership Member of Quality, Performance and Finance Committee, Member of Clinical Quality Review Group and is the Urgent Care Workstream Sponsor for the CCG. External appointments Dr Rowell is the Primary Care Lead for the North of England Cardiovascular Network 56 Key strengths Ms Fruend has extensive healthcare experience including management of clinical services, clinical governance, risk management and education. Experience Ms Fruend has over 20 years’ experience in a variety of healthcare and geographic settings, including Europe and the United States. More recently she was working in acute hospital trusts prior to joining the CCG. Other committee membership Member of Quality, Performance and Finance Committee, Member of Governance and Risk Committee. External appointments Ms Fruend is also the Executive Nurse for Hartlepool and Stockton‐On‐Tees Clinical Commissioning Group. Member of Primary and Secondary Care Quality Surveillance Groups and local Safeguarding Boards. Key strengths Dr Milner has extensive experience in out of hours care services and general medical practice. Experience Dr Milner has been a GP for over 25 years and has special interests in epilepsy and urgent care. Involved in the Langbaurgh Pathfinder and PCG for many years, he is the clinical lead for the NHS South Tees CCG Urgent Care workstream and is actively involved in the development of the Urgent Care Strategy. Dr Milner is also the Caldicott Guardian for the CCG Committee membership Member of Governance and Risk Committee. No external appointments Govern
nance: Gooverningg Body Dr Joh
hn Drury Secon
ndary Care
e Doctor
Simon Greggory Chief Finannce Office
er Appointted on 1 April 2013 and wil l seek reaappointment in March 20115. ppointed on 11 April 2013 Ap
Key strengths K
Extensive expe
E
erience at management and
d board level in healthcare and
h
d broad know
wledge of NHS landscape. Experience E
Dr Drury is a re
D
etired Consulttant, formerlyy working at South Tees Ho
S
ospital NHS Fo
oundation Trusst. Dr Drury work
D
ed in Middlessbrough since 1983 and his prior roles incl
p
ude Consultant Chemical P
Pathologist annd General Mana
G
eral Hospital ger of Middleesbrough Gene
and was Mediccal Director off South Tees H
Hospitals NHSS Foundation Tru
ust from 1992
2 to 1997. Oth
her NHS roles in
ncluded Chairr of a Policy Ad
dvisory Group
p – NHS Litigation Auth
hority and thee local research ethics committee. Committee me
C
embership Member of Au
M
udit Committeee, Chair of Cliinical Professional Fo
P
orum, Remuneration Comm
mittee External appo
E
intments Dr Drury has e
D
experience as a trustee in th
he charitable sector of demeentia care. Mr Pe
eter Race MBE Lay M
Member Appointted on 1 April 2013 and wil l seek reaappointment in March 20115. engths Key stre
Mr Race has ex
M
xtensive senio
or management experiencee in
n the public and private secctor. Mr Race joined
M
d the NHS afteer retiring from the gas in
ndustry in 20005 after thirtyy five years’ se
ervice. He jo
oined Redcar and Cleveland
d Primary Care Trust (PCT) as a Non‐Executivve Director. Experience E
ibuted to and
Mr Race contr
M
d witnessed th
he evolving Health Service
H
and supporteed the single m
management te
eam concept when initiallyy, Redcar and Cleveland PCTT and Middlesbrrough PCT shaared their Boa
ard meetings and finally wheen all four PCTTs shared their resources within NHS Tee
w
es. Committee me
C
embership Chair of Audit C
Member of Qu
uality Committee, M
Performance a
P
and Finance Committee, Funding Panel
No external ap
N
ppointments Key stre
engths Mr Greggory has exten
nsive knowleddge of NHS finance, with exp
pertise in NHS tariff mechannisms, contracting and fund
ding systems.
Experien
nce Mr Greggory, a certifie
ed accountantt, has 28 yearss NHS experien
nce working in
n both Primary
ry and Secondary Care. Th
he most recent nine years’ eexperience wo
orking in commisssioning roles.
Committee membersship Memberr of Quality, Performance aand Finance Committtee, Chair of G
Governance a nd Risk Comm
mittee No external appointm
ments Mr David B
M
Brunskill Lay Membber Appointed on 11 April 2013 and will eek reappointtment in Marcch 2015. se
Key strengths Mr Brun
nskill has exten
nsive knowleddge of public partnersship working a
and executivee level manage
ement experien
nce. Experien
nce Mr Brun
nskill has been
n a police officcer for 30 years. He retired ffrom Cleveland police in Maarch 2010. As the Stockton
n Policing Com
mmander withh a career maiinly in uniform he was the head of profes sional standards ment for 5 years and spent ttime in the force departm
commun
nication department. Committee membersship Vice Chaair of NHS Sou
uth Tees CCG, Chair of Remune
eration Committee, Membeer of Audit Committtee, Member of Governancce and Risk Committtee. No external appointm
ments 57 Governance: Governing Body Principal matters reserved for the Governing Body Regulations and Control Approve Standing Orders and suspend, vary or amend Standing Orders. Approve a scheme of delegation of powers. Require and receive the declaration of interests. Approve arrangements for dealing with complaints. Adopt the organisation structures, processes and procedures. Confirm the recommendations of the CCG’s committees where the committees do not have executive powers. Establish terms of reference and reporting arrangements of all committees established by the Governing Body. Authorise use of the seal. Discipline members of the Governing Body or employees who are in breach of statutory requirements or standing orders. Approve any urgent decisions taken by the Chair of the CCG and Chief Officer for ratification by the CCG in public session. Appointments or Dismissal Appoint the Vice Chair of the Governing Body. Appoint and dismiss other committees (and individual members) that are directly accountable to the Governing Body. Appoint, appraise, discipline and dismiss officer members. Confirm appointment of members of any committee of the CCG as representatives on outside bodies. Approve proposals of the Remuneration Committee regarding senior employees and those of the Chief Officer for staff not covered by the Remuneration Committee. Strategy, Commissioning Plan and Budgets Define the strategic aims and objectives of the CCG. Identify the key strategic risks, evaluate them and ensure adequate responses are in place and are monitored. Approve plans in respect of the application of available financial resources to support the agreed Commissioning Plan. 58 Approve proposals for ensuring quality and developing clinical governance in services provided by the CCG or its constituent practices. Approve the CCG annual commissioning strategy or plan. Approve annually the CCG Clear and Credible Plan. Approve the CCG’s policies and procedures for the management of risk. Approve Outline and Final Business Cases for Capital Investment Approve budgets. Approve annually CCG’s proposed organisational development proposals. Approve the opening of bank accounts. Approve proposals in individual cases for the write off of losses or making of special payments above the limits of delegation to the Chief Officer and Chief Finance Officer. Approve individual compensation payments. Approve proposals for action on litigation against or on behalf of the CCG. Approve proposals for CCG or practice incentive schemes. Approve Annual Report and Annual Accounts. Policy Determination Approve management policies including personnel policies incorporating the arrangements for the appointment, removal and remuneration of staff by the CCG. Audit Approve the appointment (and where necessary dismissal) of External Auditors. Receive the annual management letter received from the External Auditor. Delegate responsibility to the NHS South Tees CCG Audit Committee to receive an annual report from the Internal Auditor and agree action on recommendations where appropriate. Governance: Governing Body assurance, risk and governance issues. The arrangements meet the requirements of best practice guidance in respect of risk management and ensure that a strong accountability framework has been established. What has the Governing Body done during the year? During the year 2013/14 our Governing Body met on seven occasions; two of which were not in public and 5 in public, and for which there was an annual cycle of business. Agendas are structured to deal with strategic, performance, quality Governance & Risk April May July September November January March 
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During the year the Governing Body considered Governance Ratification of the key decisions made by the shadow CCG prior to April 2013 The Register of Interests Changes to the NHS Constitution Amendments to the CCG constitution Human Resource policies Equality priority objectives Annual Cycle of Business Standards of Business Conduct Governance assurance framework Minutes of other committees Renewed terms of reference for committees Strategy The corporate objectives for 2013‐14 Information Governance Strategy IMProVE updates and plans Commissioning Intentions Risk Management Strategy and Policy Health and Safety Strategy Commercial Sponsorship and Joint Working with the Pharmaceutical Industry Policy Strategic vision and Better Care Fund Membership Operational Matters Matters 
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Quality Reports on the Francis Report Reports on Winterbourne View Report on the Keogh quality review Report on the Berwick report Winter preparedness assurance Safeguarding Children and Adults report Performance and Finance Reports on the CCG’s financial position Work stream review Planning updates for 2014‐15 NHS England Assurance Reports Investment in winter pressures Engagement Communications Updates Feedback from the council of members Updates from the localities Updates on the Joint Strategic Need Assessment Call to Action report Reports from Public Health Directors
59 Governance: Governing Body How do we maintain an effective Governing Body? Governing Body relationships 
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The effective working of the Governing Body is crucial to the strategic aims of the CCG. This is achieved through strong and open working relationships between Governing Body members, whose roles are agreed and set out in writing. In addition to the core six GP members of the Governing Body there six other roles. A short summary of all roles is set out below Chair 
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Responsible for overall leadership and governance of the Governing Body. Ensures that the Governing Body Members have an understanding of the views of the CCG’s major stakeholders Ensures a healthy culture of challenge and debate at Governing Body and Committee meetings. Chief Officer 
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Responsible for the effective leadership of the CCG. Implementation of the CCG’s objectives and strategy agreed by the Governing Body. Maintaining good relationships and communications with GP practices and other stakeholders. Working closely with the Chief Finance Officer to ensure prudent financial controls. Developing and implementing policies integral to improving the business, including in relation to Health and Safety and Sustainability. Lay Members 
Lay members bring specific expertise and experience, as well as their knowledge as a member of the local community, to the work of the Governing Body. GP Members 
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60 Give a strategic clinical view on all aspects of CCG business. Clinical leader, beyond the boundaries of a single practice or profession – demonstrably able to think beyond their 
own professional viewpoint. In‐depth understanding of a specific locality. Take a balanced view of the clinical and management agenda and draw on their specialist skills to add value. Contribute a generic view from the perspective of a member practice in the CCG, whilst putting aside specific issues relating to their own practice circumstances. Secondary Care Doctor 
This clinical member of the Governing Body will bring a broader view, on health and care issues to underpin the work of the CCG. In particular, they will bring to the Governing Body an understanding of patient care in the secondary care setting. Executive Nurse
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This clinical role of Registered Nurse includes bringing a broader view, from their perspective as a registered nurse, on health and care issues to underpin the work of the CCG especially the contribution of nursing to patient care. Chief Finance Officer  The Governing Body’s professional expert on finance and ensuring, through robust systems and processes, the regularity and propriety of expenditure is fully discharged.  Advise the Governing Body on the effective, efficient and economic use of the CCG’s allocation to remain within that allocation and deliver required financial targets and duties. There was detailed planning throughout the year with the CCG’s governance team to consider and review the Governing Body’s annual rolling agenda programme. This ensured that all matters reserved for the Governing Body and other strategic issues were discussed at the appropriate time. Governance: Governing Body Governing Body Support The CCG’s governance team forms part of the services provided by the CCG’s commissioning support unit, North of England Commissioning Support (NECS). As part of the process of establishing the CCG in its first year of operation it took some months before the NECS support role to the Governing Body and its Committees was effectively developed. From the autumn of 2013 the Governing Body and its Committees are provided with sufficient resources to undertake their duties. Refreshment and Development of the Governing Body We are an organisation that invests in the development of our people. During the year to March 2013 two of our Governing Body GP members completed leadership training provided by the NHS North East Leadership Academy. Two more GPs from the CCG’s membership have now commenced this same course. This develops the group of GPs who may become Governing Body members in the future. Governing Body Development Sessions Our Governing Body reviewed effectiveness to ensure that it is composed of the right people, has strong and effective leadership, demonstrates effective behaviours, values and promotes constructive relationships with management and stakeholders. One of the key requirements of our Governing Body is the ability for members to challenge thinking and critically analyse decisions. Work was undertaken to ensure our Governing Body is developing and promoting our collective vision of the CCG including our purpose, our culture, our values and our behaviours. During the year we have run four development sessions with the Governing Body members. The focus of these sessions included;  Governing Body Effectiveness  Quality and Quality Metrics  Governance  Counter Fraud  Commissioning Plans clarify the legal duties and responsibilities of individual members. It also encourages member participation and involvement, developing commitment and a sense of ownership. Other bodies Members of the Governing Body are also members of other boards and bodies related to health. Amanda Hume Middlesbrough Health and Wellbeing Board Redcar and Cleveland Health and Wellbeing Board Northern Commissioning Forum Dr Henry Waters Academic Health Science Network, Non‐executive Director Northern Commissioning Forum Dr Janet Walker Redcar and Cleveland Health and Wellbeing Board Tees Medicines Management Committee Dr Nigel Rowell North of England Cardiovascular Network Dr Vaishali Nanda Middlesbrough Health and Wellbeing Board Durham, Darlington and Tees ‐ Primary Care Quality Surveillance Group Dr Ali Tahmassebi Director of Slaters Bridge; a social enterprise looking at patients in primary care Ms Jean Fruend Hartlepool and Stockton CCG Governing Body Durham, Darlington and Tees ‐ Secondary Care Quality Surveillance Group Local Safeguarding Boards The sessions were an opportunity to review best practice in governance and assess ourselves against good practice. It was an opportunity to 61 Governance: Governing Body What are the Governing Body’s priorities for 2014/15? Membership Dr Henry Waters, our Chair will be retiring in November 2014 as a member of the Governing Body. The member practices will elect a new member of the Governing Body. The Governing Body Chair is subject to a process requiring selection and election prior to appointment and may be any member of the CCG Governing Body other than the Accountable Officer, Chief Finance Officer, secondary care specialist doctor, registered nurse or the lay member with the lead role in overseeing key elements of financial management and audit. As stated within the constitution the term of office for the new Chair will be a minimum of 2 and maximum of 3 years. The new Chair must be accredited by national assessment criteria stipulated for role and the Chair must be a GP practicing within a member CCG practice. Strategy The Governing Body will continue to develop strategy and provide leadership in 2014‐15. In addition to the delivery of core national strategies, there will also be a local focus on some specific issues. The CCG’s strategy for community services will see the commencement of a consultation exercise regarding the future shape of community services in our area. These plans are designed to tackle the issues of optimising the use of the best quality community estate and ensuring that high quality services are available ‘closer to home’. A related strategy will be developed around urgent care services; the CCG has one of the highest levels of emergency admissions for its population in the country. The Governing Body will work the Health and Wellbeing Boards and local NHS Foundation Trusts to reduce our levels of unplanned care. 2014‐15 will also see the initial steps to implementing the ‘Better Care Fund’, reallocating funds from acute hospital emergency care into 62 integrated services. The additional investment in 2014‐15 will be £1.2 million; this figure will rise significantly in 2015‐16. We will also be looking to develop a full set of strategies that cover the full range of services that the CCG is responsible for commissioning. Another area that we feel we need to improve is the level of public engagement in developing our commissioning intentions. We have held two engagement events in 2013‐14, but we recognise we need to reach out to engage with a greater number and range of patient and carer groups. Development In 2014‐15 the Governing Body will continue with its development sessions, we expect five will be held in 2014‐15. The Governing Body will also develop a Governing Body induction process for new members. The reviews of Governing Body effectiveness have identified a need to ensure clearer distinctions between reporting of subjects that are reviewed both by the Governing Body and the Quality, Performance and Finance Committee. In 2014‐15 it is expected that papers taken to the Governing Body will focus more on strategic issues, leaving performance monitoring to the appropriate committee. The Governing Body and its committees will again review their terms of reference and membership structures in 2014‐15. These reviews will ensure that the CCG maintains is focus on the quality and relevance of it governance. Governance: Quality, Performance and Finance Quality, Performance and Finance Committee 
Committee members during the year ended 31 March 2013 
Member Dr Ali Tahmassebi, Chair Amanda Hume, Chief Officer Dr Janet Walker, GP Member Dr Vaishali Nanda, GP Member Jean Fruend, Executive Nurse Simon Gregory, Chief Finance Officer Attended 6/6 4/6 6/6 5/6 3/6 5/6 Responsibilities The committee is responsible for assuring the Governing Body that commissioned services are being delivered in a high quality and safe manner, and performance is managed according to the agreed terms of the Service Agreements and Legally Binding Contracts and that appropriate corrective action is being taken to address areas of underperformance, including changes to future contracts where necessary. This includes ensuring that services commissioned:  Are safe, effective and deliver a positive experience for patients  Deliver continuous improvement in quality  Operate within the agreed financial control totals  Deliver the quality, innovation, productivity and prevention challenge within financial resources, in line with national requirements (including excellent outcomes), and local joint health and wellbeing strategies  Fulfil their statutory responsibilities with regards to safeguarding 
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Quality monitoring reports on provider commissioned services, including the reporting of serious untoward incidents Provider complaints, claims and untoward incidents Provider Healthcare Acquired Infections Provision of Nursing Home Care Performance monitoring of provider contracts Monitoring delivery of the 2013/14 financial plan Delivery of Quality, Innovation, Productivity and Prevention Plans Self‐Assessment in 2013‐14 During the Governing Body’s effectiveness review, members of the Quality, Performance and Finance committee expressed the view that there was an overlap with the Governing Body. The two meetings are largely attended by all Governing Body members and meet on alternate months. It was felt that there should be more clarity of focus on ensuring that papers for the Governing Body developed and review strategy whilst performance monitoring should be delivered solely by the Quality, Performance and Finance Committee. The terms of reference have been reviewed and amended to establish the role of this committee in establishing budgets at GP practice level for commissioned services and medicines expenditure that may be appropriately monitored at practice level. What has the Committee done during the year? Significantly during the year through its cycle of business, the Quality Performance and Finance Committee and its associated sub‐committees have considered the following issues; 63 Governance: Quality, Performance and Finance cycle of business. Agendas are structured to deal with performance, quality assurance and finance issues. What has the Quality, Performance and Finance Committee done during the year? During the year 2013/14 our QPF Committee met on 6 occasions and for which there was an annual April June August October December February Quality 
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During the year the Quality, Performance and Finance Committee considered In addition to reviewing its terms of reference and the minutes of committees such as the Clinical Quality Review Groups, the committee’s work included: Quality Commissioning for Quality and Innovation (CQIN) scheme Medicines optimisation Patient surveys Healthcare Acquired Infections Risk profiling and care management in primary care Mental health and learning disability Foundation Trust Quality Accounts Quality impact of Cost Improvement Plans Quality, Innovation, Productivity & Prevention (QIPP) plans Provider quality information supporting assurance visits Compliance with recommendations from national inquires e.g. Francis, Winterbourne Serious Untoward Incidents (SUIs) Complaints Quality, Performance and Finance Committee meetings are scheduled to last for two hours. The Committee have spent five hours and 25 minutes discussing quality; on average this is around one hour of each meeting. Performance Clinical workstreams Continuing Health Care Payment by Results Planning – strategic and operation plans, Better Care Fund, financial plan The Committee have spent three hours and 35 minutes discussing performance; on average this is around 35 minutes of each meeting. Finance Financial position and risks Prescribing Budgets The Committee have spent 90 minutes discussing finance; on average this is around 15 minutes of each meeting
64 Governance: Audit Committee endorsement by the Clinical Commissioning Group.  The underlying assurance processes that indicate the degree of achievement of our objectives, the effectiveness of the management of principal risks and the appropriateness of the above disclosure statements.  The policies for ensuring compliance with relevant regulatory, legal and code of conduct requirements and related reporting and self‐certification.  The policies and procedures for all work related to fraud and corruption as set out in Secretary of State Directions and as required by the NHS Counter Fraud and Security Management Service. Audit Committee Committee members during the year ended 31 March 2013 There were five Audit Committee meetings held during the year ended 31 March 2014. The attendance record of the Audit Committee for 2013‐14 members is shown in the table below. Member Peter Race MBE, Chair Dr John Drury, Secondary Care Doctor David Brunskill, Lay Member Attended 3/5 4/5 4/5 Responsibilities The committee is authorised by the Governing Body to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co‐operate with any request made by this committee. The committee is authorised by the Governing Body to obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers necessary. The committee reviews our financial reporting and internal control principles and ensures an appropriate relationship with both internal and external auditors is maintained. In addition the committee is driven by the priorities identified by the Clinical Commissioning Group and the associated risks. In carrying out this work the committee utilises the work of internal audit, external audit and other assurance functions, but is not limited to these sources. It will also seek reports and assurances from Governing Body members and managers as appropriate, concentrating on the over‐arching systems of integrated governance, risk management and internal control, together with indicators of their effectiveness. The committee reviews the establishment and maintenance of an effective system of integrated governance, risk management and internal control, across the whole of our activities supporting the achievement of our objectives. Its work dovetails with the Governance and Risk Committee, assuring that robust risk management systems are in place. In particular, the committee reviews the adequacy and effectiveness of:  All risk and control related disclosure statements, together with any appropriate independent assurances, prior to 65 Governance: Audit Committee Audit Committee‐ Annual Report 2013/2014 This report to the Governing Body covers the year to 1st April 2013 – 31st March 2014 and is submitted as a requirement under the terms of reference of the Audit Committee. The principal purpose of the report is to give the Governing Body assurance as to the work carried out to support the Annual Governance Statement given by the Accountable Officer on its behalf. Audit Committee The Audit Committee is established under Governing Body delegation with approved terms of reference that are aligned with the NHS Committee Handbook, published by the Healthcare Finance Managers Association and the Department of Health. The Committee, that consists of two Lay Members and our Secondary Care Doctor, has met on five occasions formally in the period 2013‐14, and has discharged its responsibilities for scrutinising the risks and controls which affect all aspects of the CCG’s business. The work programme of the Audit Committee is guided by a cycle of business programme agreed annually by the committee. The programme enables the Audit Committee to carry out its key objectives necessary to support its assurances in respect of the Annual Governance Statement. opinion and other appropriate external independent assurances and considered that the Annual Governance Statement was consistent with the Audit Committee’s view on the CCGs system of internal control. Accordingly we supported the Governing Body’s approval of the Annual Governance Statement. 

The Committee reviewed the Assurance Framework and believe that it was fit for purpose and has reviewed evidence to support this. The Framework is in line with Department of Health expectations and has been reviewed by internal and external audit to give additional assurance for our opinion. The Committee has reviewed the completeness of the risk management system and the extent to which it is embedded within the organisation. This included a regular review of the organisation’s risk management arrangements and in particular its risk registers. 2. Internal audit: throughout the year the Committee has worked effectively with internal audit to review and strengthen the CCG’s internal controls and in particular: 
Principal Review Areas This annual report is divided into five sections reflecting the five key duties of the Committee as set out in the terms of reference. 
1.Governance, risk management and internal control: 
66 The Committee has reviewed relevant disclosure statements, in particular the Annual Governance Statement together with the Head of Internal Audit Opinion, external audit Reviewed and approved the internal audit strategy, operational plan and detailed programme of work. The formal meetings always include at least one member of their team. We consider their reports, agree their programmes and consider their effectiveness. They also deliver our fraud protection programmes and we consider the reports to be aware of any issues requiring further action. In this connection there were no major incidents which required additional time allocation. Considered the findings of internal audit and sought assurance that management had responded in an appropriate way and that the Head of Internal Audit Opinion and Annual Governance Statement reflected any significant control weaknesses. Governance: Audit Committee 3. External audit: 5. Financial Reporting: 
We would again like to thank the CFO for their openness and cooperation in sharing information with the Committee and taking the extra time to provide explanations and debate key areas with us. 
The Committee reviewed and agreed external audit’s annual plan The Committee reviewed and commented on the reports prepared by external audit As with internal audit we always have at least one member of their team present at our formal meetings. We review their work and findings, follow up their management requests, and agree their fee proposals. They keep us informed in respect of the ever changing nature of DofH requirements, and have arranged briefing sessions where necessary. The Audit Committee again met with the auditors (both Internal & External) on at least one occasion without Management present. Following examples of best practice the committee also meets with the auditors immediately prior to each of the formal meetings without a management presence and this proves most useful for the members. 4. Management: Whilst the Committee meets formally six times a year we also have informal meetings with the Chief Finance Officer (CFO). These are mainly educational and contain briefings on the monthly accounts including comparatives to budget, outlining future budget plans. The Audit Committee greatly values these discussions, which also give the CFO an informal setting to highlight issues and concerns. We are able as a result to give the Governing Body assurances of independent scrutiny of items submitted to it. Value for Money is important to the organisation as it is an important part of outside monitoring. We take our responsibilities seriously and are involved in scrutiny of both the external auditors report and in helping the CFO formulate his plan and budgets. The time allocated to these meetings permits a greater degree of scrutiny and understanding than is possible at a full meeting of the GB and has helped Inform the reporting of progress to make this more readily accessible. Other matters worthy of note In addition to reviewing in detail the Annual Accounts in order to give assurance to the GB, we also reviewed the Annual Accounts process in detail. Linked to this we also reviewed and approved the CCG’s Annual Report. Self‐Assessment of Effectiveness We confirm that we have carried out our self‐
assessment, strengthening our model of assessment. Following the outcome of the assessment there were no concerns to be actioned. Conclusion We trust the Governing Body will accept that this report demonstrates that the work we have carried out is consistent with opinions on the Annual Governance Statement and that the Committee has complied with its terms of reference. Finally I am pleased to record that members of the Audit Committee are grateful for the openness and commitments of all the management team, an on a personal note I must thanks my colleagues on the Audit Committee for their willing support and expertise. Mr Peter Race MBE Chair Audit Committee 6 June 2014 67 Governance: Audit Committee Audit Committee Annual Cycle of Business for the year 2013/14 During the year the committee has received reports and considered Audit Committee Considered terms of reference and Audit Committee effectiveness Governance Annual Governance Statement Annual Report Review Assurance Framework Statutory duties Received updates on the Audit Committee Handbook Review CCG Annual Report Agree the Audit Committee's annual report to the Governing Body Progress report including consideration of emerging findings from external audit work Approval of External Audit Plan and fees Advice on the Internal Audit strategy and the work plan for the beginning of the new financial year Approval of Internal Audit Plan 68 Counter Fraud Counter Fraud progress report Counter Fraud Annual Report Counter Fraud Annual plan Review of losses and special payments Use of company seal Aged Debtors and Creditors Ensure systems for financial reporting to the Governing Body including budgetary control, are subject to review regarding completeness and accuracy of information Consider reviews by of bodies or regulatory organisations Consider mid‐year report on emerging findings from Internal Audit Assurance report from Governance & Risk Committee regarding compliance with statutory duties and effectiveness of policies Received the Annual Accounts External Audit External Audit annual plan for previous year Internal Audit Review of Internal Audit provision Governance: Remuneration Report Remuneration Committee Remuneration Report The remuneration for senior managers for current and future financial years is determined in accordance with relevant guidance, best practice and national policy. Committee members during the year ended 31 March 2013 Member Attended Dr Henry Waters, Chair 1/3 Dr John Drury, Secondary Care Doctor 3/3 Peter Race MBE, Lay Member 2/3 David Brunskill, Lay Member 2/3 Responsibilities The remuneration committee was established to advise the Governing Body about pay, other benefits and terms of employment for the Chief Officer and other senior staff. The remuneration committee is established in accordance with NHS South Tees Clinical Commissioning Group’s constitution, standing orders and scheme of delegation, the committee is made up as follows: The remuneration committee has delegated authority from the Governing Body to make recommendations on determinations about pay and remuneration for employees of the CCG and people who provide services to the CCG. Self‐Assessment in 2013‐14 During the year it became clear that the committee would need to consider the local market conditions for remuneration. This information would be sourced by the Chief Officer and Chief Financial Officer benchmarking salaries with other local organisations. Continuation of employment for all senior managers is subject to satisfactory performance. Performance in post and progress in achieving set objectives is reviewed annually. There were no individual performance review payments made to any senior managers during the year. This is in accordance with standard NHS terms and conditions of service and guidance issued by the Department of Health. Contracts of employment in relation to all senior managers employed by the Clinical Commissioning Group are permanent in nature and subject to six months’ notice of termination by either party. Lay members and the Secondary care Doctor are appointed for a period of two years in the first instance, and can serve for a maximum of two terms. Termination payments are limited to those laid down in statute and those provided for within NHS terms and conditions of service and under the NHS Pension Scheme Regulations for those who are members of the scheme. No awards have been made during the year to past senior managers. 69 Governance: Remuneration Report For the purpose of this remuneration report, the definition of “senior managers” is as per the Clinical Commissioning Group Annual Reporting Guidance published by NHS England: Those persons in senior positions having authority or responsibility for directing or controlling the major activities of the Clinical Commissioning Group. This means those who influence the decisions of the entity as a whole rather than the decisions of individual directorates or departments. It is considered that the Governing Body members represent the senior managers of the Clinical Commissioning Group. NHS South Tees CCG Senior Officers 2013/14 Declarations of Interests: Name Title Declaration detail Dr Ali Tahmassebi Governing Body Member Locality Lead (Langbaurgh) Urgent Care Lead, Governing Body
Member Partner Bentley Medical Practice; Partner Park Avenue Surgery. Dr Mike Milner 70 Out of hours GP for Northern Doctors Out of hours GP service; South Tees Hospitals NHS Foundation Trust GP Huntcliff Surgery. None.
Mr David Brunskill PPI Lay Member Dr John Drury Ms Jean Fruend Secondary Care Doctor, Lay Member Executive Nurse Mr Simon Gregory Chief Finance Officer
Mrs Amanda Hume Chief Officer None.
Mr Peter Race Lay Member Governance
None.
Dr Nigel Rowell Governing Body Member
Dr Janet Walker Governing Body GP Locality Lead (Eston) Director, Endeavour Practice Ltd; Primary Care Lead, North of England Cardio Vascular Network; GPSI in heart failure, South Tees Hospitals NHS Foundation Trust Live : Life study Principle Investigator, Servier laboratories Ltd. Partner, Dr Royal and Partners Manor House Surgery, Normanby. Dr Henry J Waters Governing Body Chairman
Dr Vaishali Nanda Governing Body GP Locality Lead (Middlesbrough) None.
Executive Nurse for Hartlepool and Stockton on Tees CCG. Partner works for Tees, Esk and Wear Valley NHS FT Finance Team. GP, Village Medical Centre; Non Exec Director, North East & Cumbria Academic Health Science Network; Trustee, Providence Baptist Church, Hemlington. Partner, Discovery Practice; Husband owns Nanda Medical Services for private orthopaedic work; Husband is a consultant in orthopaedics at North Tees & Hartlepool NHS FT. Governance: Remuneration Report South Tees Clinical Commissioning Group Senior Officers Salaries & Allowances 2013/14: Name Dr Ali Tahmassebi Dr Mike Milner Title Governing Body Member, Locality Lead (Langbaurgh)
Urgent Care lead, Governing Body Member 2013/14 Taxable Annual Long‐term All Pension Total Salary & Benefits Performance Performance Related Fees (Rounded Related Related Benefits (bands of to the Bonuses Bonuses £5,000) nearest (bands of (bands of (bands of (bands £000) £5,000) £5,000) £2,500) of £5,000)
£000 £000 £000 £000 £000 £000 65‐70 N/A N/A N/A 80‐82.5 145‐150
35‐40 N/A N/A N/A 87.5‐90 120‐125
Mr David Brunskill PPI Lay Member 10‐15 N/A N/A N/A N/A 10‐15 Dr John Drury Consultant 10‐15 N/A N/A N/A N/A 10‐15 Ms Jean Fruend Executive Nurse from 25 April 2013 30‐35 N/A N/A N/A N/A 30‐35 Mr Simon Gregory Chief Finance Officer 95‐100 N/A N/A N/A 77.5‐80 170‐175
120‐125 N/A N/A N/A Mrs Amanda Hume Chief Officer 115‐117.5 235‐240
Mr Peter Race Lay Member, Governance 10‐15 N/A N/A N/A N/A 10‐15 Dr Nigel Rowell Governing Body Member 25‐30 N/A N/A N/A 307.5‐310 335‐340
Dr Janet Walker Governing Body GP 60‐65 N/A N/A N/A 117.5‐120 175‐180
Dr Henry Waters Governing Body Chairman 105‐110 N/A N/A N/A N/A 105‐110
Dr Vaishali Nanda Governing Body GP 75‐80 N/A N/A N/A N/A 75‐80 Notes: As this is the first full year of the CCG there are no prior year comparatives to disclose. The following senior officers are not directly employed by the CCG. The amounts disclosed above are paid to the respective GP practices, to provide the services of the individuals on a sessional basis (this only applies to Drs Nanda & Tahmassebi): Ms Jean Fruend is employed by Hartlepool and Stockton‐on‐Tees CCG but also works for South Tees CCG as part of a 50/50 staff sharing arrangement. The salary disclosed above shows the CCG’s share of remuneration. Their banded total remuneration in the financial year 2013/14 was £60,000 to £65,000. Pay Multiples Reporting bodies are required to disclose the relationship between the remuneration of the highest‐paid director in their organisation and the median remuneration of the organisation's workforce. The banded remuneration of the highest paid member of the Governing Body in NHS South Tees Clinical Commissioning Group in the financial year 2013/14 was £120,000 ‐ £125,000. This was 3.8 times the median remuneration of the workforce, which was £31,254. Total remuneration includes salary, non‐consolidated performance‐related pay and benefits‐in‐kind. It does not include severance payments, employer pension contributions and the cash equivalent transfer value of pensions. Pay Multiples Band of Highest Paid Director's Total Remuneration (£000) Median Total Remuneration (£) Ratio 2013/14 120‐125 £31,254 3.8 71 72
N/A N/A N/A 2.5 ‐ 5 5 – 7.5 Mr David Brunskill PPI Lay Member Dr John Drury Consultant Ms Jean Fruend Executive Nurse from 25 April 2013 Mr Simon Gregory Chief Finance Officer Mrs Amanda Hume Chief Officer 2.5 ‐ 5 Dr Mike Milner Urgent Care Leas, Governing Body Member N/A 5 – 7.5 Dr Janet Walker Governing Body GP Dr Henry J Waters Governing Body Chairman 12.5 ‐ 15 Mr Nigel Rowell Governing Body GP N/A 2.5 ‐ 5 Dr Ali Tahmassebi Governing Body Member Locality Lead (Langbaurgh) Mr Peter Race Lay Member, Governance £000 Real increase in pension at age 60 (bands of £2500) Name and Title NHS South Tees CCG Senior Officers Pension Benefits 2013/14: N/A 15 – 17.5 40 – 42.5 N/A 15 ‐ 17.5 10 – 12.5 N/A N/A N/A 10 – 12.5 10 – 12.5 £000 Real increase in Pension Lump Sum at aged 60 (bands of £2500) N/A 5 ‐ 10 15 ‐ 20 N/A 35 ‐ 40 30 ‐ 35 N/A N/A N/A 5 ‐ 10 5 ‐ 10 £000 Total accrued pension at age 60 at 31 March 2014 (bands of £5000) N/A 15 ‐ 20 50 ‐ 55 N/A 105 ‐ 110 100 ‐ 105 N/A N/A N/A 25 ‐ 30 15 ‐ 20 £000 Lump Sum at aged 60 related to accrued pension at 31 March 2014 (bands of £5000) N/A 97 362 N/A 597 580 N/A N/A N/A 172 82 £000 Cash Equivale
nt Transfer Value at 31 March 2014 N/A 23 75 N/A 477 495 N/A N/A N/A 91 37 £000 Cash Equivalent Transfer Value at 31 March 2013 N/A 73 285 N/A 110 74 N/A N/A N/A 79 44 £000 Real increase in cash equivalent transfer value N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A £000 Employer’s contribution to stakeholder pension Governance: Remuneration Report N/A Real increase in pension at age 60 (bands of £2500) N/A Real increase in Pension Lump Sum at aged 60 (bands of £2500) N/A Total accrued pension at age 60 at 31 March 2014 (bands of £5000) N/A Lump Sum at aged 60 related to accrued pension at 31 March 2014 (bands of £5000) N/A Cash Equivale
nt Transfer Value at 31 March 2014 N/A Cash Equivalent Transfer Value at 31 March 2013 N/A Real increase in cash equivalent transfer value 6 June 2014 Chief Officer and Accountable Officer for NHS South Tees CCG Amanda Hume N/A Employer’s contribution to stakeholder pension Cash Equivalent Transfer Values A cash equivalent transfer value (CETV) is the actuarially assessed capital value of the pension scheme benefits accrued by a member at a particular point in time. The benefits valued are the member’s accrued benefits and any contingent spouse’s pension payable from the scheme. A CETV is a payment made by a pension scheme or arrangement to secure pension benefits in another pension scheme or arrangement when the member leaves a scheme and chooses to transfer the benefit accrued in their former scheme. The pension figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies. The CETV figures and the other pension details include the value of any pension benefits in another scheme or arrangement which the individual has transferred to the NHS pension scheme. They also include any additional pension benefit accrued to the member as a result of their purchasing additional years of pension service in the scheme at their own cost. CETVs are calculated within the guidelines and framework prescribed by the Institute and Faculty of Actuaries. Real increase in Cash Equivalent Transfer Values This reflects the increase in CETV effectively funded by the employer. It takes account of the increase in accrued pension due to inflation, contributions paid by the employee, (including the value of any benefits transferred from another scheme or arrangement) and uses common market valuation factors for the start and end of the period. Dr Vaishali Nanda Governing Body GP Name and Title Governance: Remuneration Report 73
Governance: Governance and Risk Committee Governance and Risk Committee •
Committee members during the year ended 31 March 2013 Member Attended Simon Gregory, Chair 5/5 David Brunskill, Lay Member 4/5 Dr Mike Milner, GP Member 2/5 Jean Fruend, Executive Nurse, 1/3 from December 2013 Dr Milner is our Caldicott Guardian10 and Mr Gregory is the CCG’s Senior Information Risk Officer. During the year it was agreed that Ms Jean Fruend, Executive Nurse should join the committee. It was felt that this would ensure that issues regarding quality and risk could be assessed more effectively. Responsibilities The principal purpose of the Governance and Risk Committee is to exercise on behalf of the Governing Body the functions that are delegated to it in respect of the development, implementation and monitoring of integrated risk and governance. In particular, by providing assurance on the systems and processes by which the Governing Body leads, directs and controls its functions in order to achieve its organisational objectives. In particular, it has overall responsibility for reviewing the CCG Assurance Framework and Corporate Risk Registers, (together with the Audit Committee), and upon which reports were made to the Governing Body. The Committee’s terms of reference are referenced within our Constitution and are available on our website. What has the Committee done during the year? Significantly during the year through its cycle of business, the Governance and Risk Committee has considered the following quality, risk, safety and governance issues; •
10
The Caldicott Guardian is the senior person responsible for protecting the confidentiality of patient information. 74 •
•
•
•
Information Governance Strategy and associated updates Corporate Risk Register and Governing Body Assurance Framework Risk Management Strategy and Governance Framework Health and Safety Strategy Assurance on Equality, Diversity and Human Rights arrangements Relevant policy approval Self‐assessment in 2013‐14 The role of the Governance and Risk committee evolved during 2013‐14. The CCG was established with a set of policies developed in the shadow year. In the first year of operation a considerable amount of committee time was involved in reviewing and approving new policies for the CCG. The CCG started the year with a risk register created during the previous year, many of the risks identified related to transitional issues relating to the commencement of the CCG. The committee was able to close most of these risks as the CCG established itself. The committee established a clear view on risk, but felt that it needed more clinical advice on quality risks. The CCG’s Executive Nurse was asked to join the committee in December to provide this support. In addition the committee decided during the year that the terms of reference should be amended and its role in relation to information risk management should be made explicit. Governance: Funding Panel Funding Panel Committee members during the year ended 31 March 2013 Member Peter Race, Chair Dr Janet Walker, GP Governing Body Member Dr Tony Chahal, GP Clinical Advisor Responsibilities The Funding Panel will consider all individual funding requests and decide whether to support or not support these individual requests on the basis of the information provided with the request to the Committee. It develops and agrees protocols for accessing services or treatment not within contract, either for NHS or non‐NHS providers where a service level agreement or contract does not exist. 75 Goverrnance: EEquality and Diveersity Equality and Divversity We are aa CCG with aa small numb
ber of directlly employeed team mem
mbers. We are based in tthe heart off North Ormeesby Health V
Village, and w
we are supp
ported by a ccommissioning support uunit (North o
of England Co
ommissionin
ng Support).
We havee a dedicated
d Diversity Lead and nominatted Lay Mem
mber for Equa
ality and Diversityy within the CCG. Our divversity manaager and hum
man resourcees support arre provided bby our com
mmissioning ssupport unit to provide proactivve advice and
d guidance on all equalityy matters. This is mon
nitored throu
ugh the e. The group has Governaance and Risk Committee
an estab
blished set off equality ob
bjectives thatt it reviews quarterly. In ad
ddition, the CCG has effeectively managed its emp
ployment relations, workking construcctively with
h staff on a range of issuees. These have inclu
uded the devvelopment oof employme
ent policies, develop
pment of thee on‐call process and the identification of trainingg and development needs through a
appraisal. Stafff gender profile The CCG genderr profiles for employees ccan be seen
n in Figure 1 alongside thhe number o
of senior man
nagers within
n the CCG of f each sex tha
at are at the grade ‘Very Senior Man ager' (VSM) in Figure 2. A
A breakdown
n of the num ber of peoplle of each
h sex within the CCG on tthe Governin
ng Body is Figure 3. d support staaff aim to saffeguard patieent CCG and
confiden
ntiality and m
maintain data security w hilst empoweering staff within NHS So
outh Tees CCCG to perform
m their role using key info
ormation governaance principlees. As part o
of staff inducction processees new emplloyees will be made awa re of CCG policies and aree encouraged
d to familiariise nal legislativee themselves with locaal and nation
and stattutory requirrements. CCG Governing
g Body staff 2013‐14 8 staff me
embers are male Figu
ure 1
During 22013‐14, the CCG has mo
onitored workforce sickness levels. We are committeed to taking stteps to improve the health and wellbbeing of our sttaff, offer support and to
o reduce the levels an
nd cost of sicckness absen
nce. CC
CG VSM stafff 2013‐14 1 staff member is m
The CCG
G has an annu
ual absence rate of 1.59%
% male which is below the o
overall North
h of England CCGs rate of 22.08%. Whilsst there are n
noticeable peeaks Figu
ure 2
and trou
ughs across tthe year it is not recomm
mended that any significance is attachhed to this, aas the small number of sttaff within thhe All CCG staff 2
2013‐14 CCG doees result in an exaggerate
ed picture. Sicknesss Absence (ro
olling year) 15 staff Annual SSickness Abssence Rate 1 .59%
members are m
Short Teerm Absencee <4 wks 00.52%
female Long Terrm Absence >=4 wks 1 .07%
Calendar Days Lost 95
Figgure 3 FTE Days Lost 995.00
Estimateed Cost £288,573
Sicknesss absence 76 4 staff membe
ers are female 1 sta
aff memb
ber is fema
ale 10 staff bers are memb
male Governance: Equality and Diversity Our Equality Strategy sets out our commitment to taking equality and human rights into account in everything we do, whether we are commissioning services, employing people, developing policies, communicating, consulting or involving people in our work. We are already planning to take further our Equality and Diversity work in the coming year in particular patient experience, working with our member practices and developing the equality champions alongside colleagues in NECS. We promote a human rights based approach to our work, with the belief that individuals should be treated with fairness, respect, equality, dignity, and autonomy. Equality & Diversity in all we do We have demonstrated our commitment to taking equality and human rights into account in everything we do, and we fully comply with the Equality Act 2010 and the Public Sector Equality Duty. We have developed and published our equality objectives for 2013/14 and have approved plans detailing actions we will take to ensure that individuals, communities and staff are treated equitably. The following tools will enable us to adhere to and measure our equality and diversity objectives: 
The Equality Delivery System (EDS) enables organisations to analyse their equality performance with the assistance of local stakeholders, prepare equality objectives and embed equality into mainstream commissioning activities in order to raise equality in service commissioning and performance for the community, patients, carers and staff. 
Staff Training is a mandatory requirement for all our staff. Senior managers are also required to undertake recruitment and selection training which includes awareness of equality and diversity legislation as it relates to the recruitment process. All new employees are taken through an induction process which covers equality and diversity awareness, CCG policies and the CCG’s approach to partnership working and accessibility. 
NHS Diversity Calendar which promotes the positive work that can be achieved when equality and diversity principles are embedded within organisations. 
Diversity Matters Newsletter which contains up‐to‐date information on relevant equality diversity and human rights legislation and developments. 
Equality Analysis (EA) ensures that we can identify the impact or effect, either positive or negative, of our policies, procedures and functions on various sections of the population we serve. For any negative impacts identified we will take immediate steps to deal with such issues and make sure equity of service delivery is available for all. Our EA Toolkit and Guidance process covers all equality groups offered protection under the Equality Act 2010 (Race, Disability, Gender, Age, Sexual Orientation, Religion/Belief, Marriage and Civil Partnership and Gender Re‐assignment) as well as Human Rights and Carers. Accessibility and Communications We ensure that our public buildings are accessible for people with a disability. We use Everyday Language Solutions when an interpreter is required by telephone and when face‐to‐face interpreting may be needed. Information for patients and the general public is available in other languages or formats such as large print or Braille and audio upon request. We have also earned the two tick ‘positive about disabled people’ symbol awarded by Jobcentre Plus which demonstrates our commitment to employ, retain and develop the abilities of disabled staff.
77 Governance: Equality and Diversity Equal Opportunities for staff We can demonstrate fair and equitable recruitment, workforce engagement and employment terms and conditions to ensure levels of pay and related terms and conditions are fairly determined for all posts, with staff doing equal work, and work rated as of equal value, being entitled to equal pay. Any employee who feels that they have been discriminated against on any grounds set out within our Equal Opportunities policy should initially raise their concerns with their line manager. Where an employee’s concerns relate to their line manager, the employee should raise their concern with the next more senior officer. Alternatively, employees may wish to discuss their concern with a member of the Human Resources Department. Where resolution cannot be achieved through informal discussion, an employee may put forward a grievance in line with the guidelines set down in the CCG’s Grievance Procedure. Alternatively the CCG’s Prevention of Harassment and Bullying at Work policy may be followed. At all stages of the procedure, employees can be accompanied by a Trade Union representative or work colleague. As a CCG we recognise the importance of completing Equality Analysis, as a way of finding out whether an existing or proposed policy, function or service has differential impact on particular people and, if so, whether the differential impact is adverse or positive and whether it can be justified or not. Completing an equality analysis is a necessary step to ensure opportunity for all is achieved with a new service or project or a ‘significant’ change to an existing service. It will show where there are gaps in services/ projects and can be used to ensure that services are commissioned which are right for local communities and cater to the needs of our diverse and ever changing population 78 “The communities that we serve as a CCG are diverse and so we must ensure that the services we commission are accessible for all, guaranteeing that access, information and fairness stay at the heart of the NHS” Mr Peter Race MBE, Lay member Govern
nance: Exxecutive Team The Execu
T
tive Team
m The Executive
T
e addresses operational issues and iss responsible
e for implementing CCG sstrategies an
nd to‐day manaagement and
policies, day‐
p
d performancce monitorin
ng. The Execu
utive review
ws business ca
ases, draft plans an
d
nd commissioning intenttions prior too their presen
ntation to th
he formal corrporate meetings. The inclusion
T
n of all of ourr Governing B
Body GPs in the executivve team means that all ouur weekly meetings retain a cliniccal focus. Thee Governing Body membbers and seniior managerss who regulaarly attend th
he executive tea
e
am are show below. Dr Henry W
D
aters Amanda Hume Jean Fruend Chair C
Chief Officcer Executiive Nurse Dr JJanet Walke
er Estoon Locality Dr Vaishali N
D
Nanda Dr Ali Tah
hmassebi Dr Niggel Rowell Dr M
Mike Milne
er Middlesbroug
M
gh Locality Langbaurggh Locality Middle
esbrough Loccality Langgbaurgh Loca
ality Simon Grregory Craig B
Blair Associaate Director o
of Commiissioning, De
elivery and Op
perations In
n addition to
o our own staaff the execu
utive team iss supported o
on a regular basis by mem
mbers of our commissionin
c
ng support unit staff who
o are subjectt matter experts for speccific issues. Chief Finance Officer
79 Governance: Risk Management Framework Risk Management System Risk Management Framework Identifying the risks that matter As we respond to new challenges and the continually changing demands of the local health economy, so does our system of risk management and internal control. Our risk appetite has been developed by our Governance and Risk Committee, responsible for the oversight of risk management within the CCG. It is the view of the committee that there is a level of normal risk inherent within healthcare commissioning. Risks that are regarded as normal business, such as any individual budget may become overspent, are not recorded on our risk register. Specific issues that arise either internally or externally that would lead to significant financial pressure or damage our reputation are recorded on our risk register. How are risks identified and reported The CCG came into being on 1 April 2013 with the risk management policy that had been adopted by the shadow CCG as part of the authorisation process. At this time the CCG brought forward the risks previously reported on the risk register of the two prior PCTs as part of the authorisation process. These risks were reassessed as part the CCGs risk management process in its initial year. The CCG formally approved its risk management policy in May 2013. The policy sets out the organisation wide approach to managing risk at all levels within the CCG. Its aims are; 
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To ensure that the risks to the achievement of the CCG’s objectives are understood and effectively managed. To ensure that the risk to the quality of services that CCG commissions are understood and effectively managed. To assure the public and other stakeholders that the CCG is committed to managing risk appropriately. To protect the resources of the CCG through the process of early identification, assessment, control and elimination of risk 80 Our risk management system is used to categorise risk against nine domains set out in the following table. Impact on the safety of patients, staff or public Quality/Complaints/Audit Human resources/organisational development Statutory duty/inspections Adverse publicity/reputation Business objectives/projects Finance including claims Services/business interruption Environmental impact Risks are rated on a matrix that measures the combination of the impact of a risk with its likelihood. Likelihood Impact 1 Rare 1 Negligible 2 Unlikely 2 Minor 3 Possible 3 Moderate 4 Likely 4 Major 5 Almost Certain 5 Catastrophic Risks are scored by multiplying the Impact by the likelihood and scores in the range of 15 to 25 are considered to be high risk. Reviewing the risk register also includes the process of assessing the effectiveness of the identified controls. The residual level of risk is then derived from the combination of initial risk and control effectiveness. Risks are reviewed at four levels within the CCG. The first level is during the day to day operations of the CCG, where our staff are working within the policies of the CCG. Risks are identified within departments, work streams and the CCG management team. Our Chief Finance Officer meets with the CCG senior team to assess risks at this level. During the CCG’s first year of operation, no new risks to the CCG at this level were identified by the CCG’s commissioning support unit (CSU). Part of developing the relationship between the CSU and the CCG will enable the better identification of risks by external support staff. Governance: Risk Management Framework The second level is a full review of the risk register with the CCG’s Executive team. This review allows Governing Body GPs the opportunity to consider the range and severity of the risks the CCG is assessing. The third level is the corporate oversight provided by the Governance and Risk Committee. This committee reviews the CCGs risk register at each meeting, validating the scoring identified. The fourth level of review is at the Governing Body where the Board Assurance Framework in considered at each meeting. Risks with a residual level score of high risk are automatically included the assurance framework. 81 Governance: Internal Control Framework Internal Control Framework Our system of internal control is the set of processes and procedures in place to ensure that we deliver our policies, aims and objectives. Combined with the risk management framework described above we can ensure that we manage risk to a reasonable level. Internal control is driven by our policies and procedures and embedded in our programme of mandatory staff training. made during first six months of the year. The CCG itself continually reviews its financial performance and it’s subject to monthly reviews of its ledgers by NHS England. We have no reason to believe that our controls were any less effective in the first half of 2013‐14. We also work in partnership with other CCGs in the North East. These collaborations are:  Arrangements with the CCGs with regard to coordinating commissioning arrangements for contracts with NHS healthcare providers in the North of England.  Joint arrangements with the CCGs to determine commissioning for health gain policies and to review and approve individual funding requests, including conducting an appeals process.  Joint arrangements with the CCGs to advise upon and make recommendations to CCGs on high cost cancer drugs and high cost treatments.  Joint arrangements with the to provide a Partnership Forum through which the CCGs will work together with Trade Union and Professional Organisation representatives to discuss issues relating to employment matters affecting their employees. The Forum will also advise and make recommendations on employment policies and procedures. A significant element of our organisational structure is that 60% of the administration of the CCG is provided via a contract with a commissioning support unit (North of England Commissioning Support). Our policies and procedures have been designed to reflect this organisational arrangement, as well as the service level agreement with the North of England Commissioning Support unit containing performance metrics relevant to their performance of this role. The commissioning support unit works with NHS Shared Business Services who provide the transaction processing services and financial ledger facilities for NHS England and all CCGs. We work closely with the commissioning support unit to ensure tight budgetary control, where we gain a good understanding of debtors and creditors to facilitate accurate cash‐flow forecasting and to ensure the NHS Shared Business Services financial ledger is accurate to enable NHS England to carry out their reporting requirements. We achieve this through twice monthly meetings between the CSU and the CCG’s CFO, monthly reconciliation sign off controls by the CCG and the production of clear, concise and accurate reporting. We contract with other support service providers and their sub‐contractors. The CCG’s payroll services are provided by Northumbria Healthcare NHS Foundation Trust using the electronic staff record service provided by McKesson UK. These support services commission service auditor reports that are available to their clients’ auditors to assess internal control risk for the purposes of planning and executing their financial audit. Our commissioning support unit in its first year of operation has commissioned a service auditor report but its findings will only apply from 1 October 2013. The CCG will experience more extensive external audit testing on transactions 82 Legacy Balance Transfers In accordance with the Health and Social Care Act 2012, Strategic Health Authorities and Primary Care Trusts were dissolved on 1 April 2013 and their assets and liabilities transferred to successor bodies in the NHS or to other entities Information Governance The NHS Information Governance Framework sets the processes and procedures by which the NHS handles information about patients and employees, in particular personal identifiable information. The NHS Information Governance Framework is supported by an information governance toolkit and the annual submission process provides assurances to the Clinical Commissioning Group, other organisations and to individuals that personal information is dealt with legally, securely, efficiently and effectively. Governance: Internal Control Framework Information governance is monitored by the Governance and Risk Committee which reports to the Governing Body. We have also appointed Governing Body members as Caldicott Guardian, Dr Mike Milner and Senior Information Risk Owner, Mr Simon Gregory. We place high importance on ensuring that there are robust information governance systems and processes in place to help protect information. We have an Information Governance Framework in place comprising an approved strategy and a suite of approved policies and procedures in line with the Information Governance Toolkit. We have ensured all staff undertake annual information governance training and have implemented a staff information governance handbook to ensure staff are aware of their information governance roles and responsibilities. We have adopted and implemented the Health and Social Care Information Centre’s (HSCIC), ‘Checklist for Reporting, Managing and Investigating Information Governance Serious Untoward Incidents’. We have adopted a suite of policies to mitigate data security breaches: Information Governance Risk Policy, Information Access Policy, Information Security Policy and Acceptable Use of Email and Internet Policy. There are processes in place for incident reporting and investigation of serious incidents. This process outlines the scope of responsibilities and details the reporting procedures to be used in the event of a data security breach. We are continuing to develop information risk assessment and management procedures and a programme is being established to further embed an information risk culture throughout the organisation. The Information Governance Toolkit has been provided by the HSCIC to support performance monitoring of progress on Information Governance in the NHS. The CCG has published the HSCIC Information Governance Toolkit and has been self‐assessed as being 68% overall compliant, which confirms the organisation’s rating as overall ‘satisfactory’ in this regard. In accordance with the agreed internal audit plan for 2013/14 an audit of the IG Toolkit self‐assessment was undertaken, the scope of which was to provide on‐going assurance that the processes for determining scores against individual requirements was adequate. Significant assurance has been given in respect of the CCG’s Information Toolkit submission following a review by Internal Audit. We use the NHS Standard Contract with our provider organisations. This contract requires them to achieve level 2 of the NHS information governance toolkit standards, thus ensuring satisfactory levels of data quality and data protection. There have been no Information Governance breaches in year 2013‐14. The CCG complies with its statutory duty to respond to requests for information. During the year the CCG received 185 requests under the Freedom of Information Act 2000 and 1 request under the Data Protection Act 1998. All the requests were responded to within the statutory timescales. Data Quality We rely on a significant number of data and information flows. These include;  Activity information from providers’ submissions into the NHS Secondary Uses Service.  Performance and quality information directly received from providers.  Financial information managed within the national Integrated Single Financial Environment.  National performance and quality measurement systems. These systems are reviewed by our internal and external auditors as part of their routine work. Additional scrutiny comes from NHS England as part of their assurance process. The Governing Body and its committees are satisfied these systems are sufficiently robust and can be relied upon. 83 Governance: Internal Control Framework Complaints The Chief Officer’s private office team responds to enquiries, comments and concerns from our local population. This service includes the Complaints Department which handles complaints in accordance with the NHS Complaints Regulations and MP enquiries on behalf of the organisation. There were 21 complaints received in 2013/14 which required our intervention. Complaints are managed in accordance with the NHS Complaints Regulations. From 1st April 2013 NHS South Tees CCG became responsible for managing complaints received from our local population in respect of commissioned services. The day to day management of the complaints process is undertaken by the Commissioning Support Unit on behalf of the CCG, with overall responsibility remaining with the CCG. Business Critical Models In partnership with our commissioning support unit we operate a small number of business critical models. These include systems that calculate our liabilities for expenditure against our contracts with healthcare providers. Critical features of these systems are;  The calculation of the correct tariffs for the service.  The correct application of algorithms that are responsible for checking that the appropriate commissioner has been assigned on the basis of service provided as well as where the patient resides. Systems managed by the NHS Business Services Authority are used to assess our liabilities for the costs of primary care drugs. These systems have not been fully assessed against the five recommendations of the Macpherson report11; however they have been subject to reconciliation with the calculations of our healthcare providers and associate commissioners to assure ourselves that they are reasonably robust and fit for purpose. We intend to work with our partners to ensure that we move towards full compliance with the recommendations. 11
Review of quality assurance of Government analytical models 84 Data Security The current legal and regulatory environment that we operate in does not permit the CCG to have direct access to patient identifiable information. We only deal with this level information when handling patients’ complaints and with the explicit permission of the data subject. We do need to be assured that the healthcare that we fund is being correctly charged to the CCG. We achieve this with data checks that are run directly under the control of the Health and Social Care Information Centre and supplied to our commissioning support unit. Pension Obligations 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, employer’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. Equality, Diversity & Human Rights Obligations Control measures are in place to ensure that all of our obligations under equality, diversity and human rights legislation are complied with. This included the agreement of a new Equality and Diversity Strategy during 2013‐14 and agreement of, and reports on progress against, our equality duties and objectives. Sustainable Development Obligations The Clinical Commissioning Group is required to report its progress in delivering against sustainable development indicators. We are developing plans to assess risks, enhance our performance and reduce our impact, including against carbon reduction and climate change adaptation objectives. This includes establishing mechanisms to embed social and environmental sustainability across policy development, business planning and in commissioning. Governance: Internal Control Framework We will ensure the Clinical Commissioning Group complies with its obligations under the Climate Change Act 2008, including the Adaptation Reporting power, and the Public Services (Social Value) Act 2012. We are also setting out our commitments as a socially responsible employer. 85 Governance: Risk Assessment Risk Assessment Significant risks facing the CCG The nature of the healthcare exposes the CCG to a number of risks. The Governing Body has considered the nature and extent of the significant risks it is willing to take in achieving the CCG’s objectives. These key risks, their level and trend are summarised in the tables below. Residual risk Risk description Mitigation
CCG Clostridium difficile target Year to date performance against Controls the CCG C.Diff target indicates Executive level discussions 20 High Risk that the CCG’s main provider will not stay within their annual target. The effect of the risk would be the failure of a key Constitutional target resulting in a reputational risk, increased focus from the Area Team and financial impact through the quality premium. Lead Executive Nurse Residual risk Risk description Executive to Executive meeting on 15 October 2013 Schedule of announced and unannounced visits by the CCG ‐
Involvement of the CCG in programme of 'Board to ward' visits in the Trust Multi‐agency meetings with CCGs, Trust and Local Authority. Reviews of reporting arrangements Contract monitoring meetings GPs received advice and guidance re C.Diff and prescribing. Discussions between GB GPs and STHFT Chiefs of Service Working Group being established between STHFT and primary care re C.Diff Internal Assurance Regular Contract Review meetings with providers. Quality, Performance and Finance Committee. Executive Group Clinical Quality Review Group Quality Surveillance Groups External Assurance Care Quality Commission Reports Local Area Team. Monitor inquiry. Actions Required Continued monitoring. Establishment of working group between primary care and STHFT. Medicines Management team developing pack for primary care re. antibiotic usage. Mitigation
CCG referral to treatment target of 90% for the 2013/14 Risk of failure against the CCG Controls referral to treatment target of Remedial action plan agreed and discussed at Contract Review 20 High Risk 90% for the 2013/14 period. The effect of the risk would be the failure of a key Constitutional target resulting in a reputational risk, increased focus from the Area Team and financial impact through the quality premium. meetings. Visit of the NHS Intensive Support Team to provide advice and guidance to the Trust. Ongoing monitoring of action plan. Executive level discussions. Monthly contract management meetings. Internal Assurance Contract Review meetings with providers. Executive Group Quality Performance and Finance Committee. External Assurance Visit of the NHS Intensive Support Team to provide advice and guidance to the Trust. Monitor inquiry Actions Required Continued monitoring of action plan Lead Chief Finance Officer & Head of Commissioning & Delivery 86 Governance: Risk Assessment Residual risk Description Mitigation
Non‐identification of Safeguarding Children GP Failure to comply with OFSTED Controls and CQC requirements relating to Weekly meetings of CCG’s quality team and designated doctor and 15 High Risk the identification of Safeguarding Children GP resulting in non‐
compliance with OFSTED and CQC requirements. Lead Executive Nurse safeguarding nurse ensures communication. Regular updates to Executive Group thus ensuring that Locality Leads are informed of key issues. Programme of visits of Children’s safeguarding team to GP Practices. Internal Assurance QPF Committee Governing Body quality updates CCG safeguarding team attended Council of Members meeting in January 2014. External Assurance None identified Actions Required Work to be undertaken to review the role to encourage more interest. Action Plan to be developed. Residual risk Description Implementation of the Better Care Fund Implementation of Better Care Fund (formerly ITF) will require 15 High Risk funding to be transferred from acute emergency care to support more integrated social and health care services. Lead Chief Finance Officer Mitigation
Controls Joint working with external agencies to ensure that all investment has health impact. Executive Group meetings. Governing Body reporting. BCF Plan to be completed and agreed with stakeholders by mid‐
February Internal Assurance Meetings with Executive Teams of Health & Wellbeing Board. NHS England monitoring. Submission and acceptance of plan by NHS England. External Assurance Health and Wellbeing Board Meetings with Executive teams of Local Authorities. Actions Required Continue joint working with partners and stakeholders. Ongoing monitoring Residual risk Description Capacity of Continuing Health Care Team CHC cases and restitution requests, together with CHC 12 High Risk staffing pressures results in continuing healthcare activity exceeding the capacity of the CHC team. This could result in a backlog Lead Executive Nurse Mitigation
Controls Reviewed fortnightly with the CSU CHC finance team. Performance management of CHC team to ensure reviews of cases are carried out in a timely manner. Internal Assurance Reporting to QPF Committee. Approval of CHC cases in line with Standing Orders. Reviewed as part of monthly budget management. External Assurance Non ISFE reporting to Area Team. Benchmarked with other local CCGs Meetings with Executive teams of Local Authorities. Actions Required Evidence of CSU compliance with SOP Consider for inclusion within internal audit plan. Ongoing monitoring 87 Governance: Risk Assessment Residual risk Description Mitigation
Membership Engagement CCG member organisations disengaging with the CCG due to 12 High Risk Controls Regular dialogue with Localities and Locality Leads Collaborative working with Local Area Team Collaboration with other CCGs Regular engagement with LMC. Financial plan in place including budget to facilitate GP engagement. Workstreams established with GP Leads. Programme support for workstreams provided by the CSU and CCG. Internal Assurance Monitoring attendance at Locality Council meetings. Monitoring of attendance at Council of Members meetings. External Assurance Local Medical Committee Actions Required Continued monitoring of attendance. Continued support of workstreams by CSU and CCG. changes in primary care contractual arrangements resulting in financial losses to GP businesses. Lead Chief Finance Officer Residual risk Description Mitigation
Urgent Care Reputational risk of surge in activity resulting in a failure to achieve winter planning targets resulting in greater pressures on A&E and delayed transfers of care. Lead Chief Finance Officer Controls Additional investment into acute trust to mitigate against potential increased pressures. High profile communications campaign. Detailed action plan and strategy for managing winter pressures. Dedicated CSU team. Internal Assurance Daily tele‐conferences with Area Team and CSU. Monitoring of action plan and key indicators. Monitoring via QPF Committee. Regular updates to Governing Body. External Assurance Weekly meetings with Area Team and CSU. Daily tele‐conferences with Area Team and CSU. Gaps None identified. Actions Required None identified 12 Extreme Risk 88 Governance: Economy, Efficiency & Effectiveness Economy, efficiency and effectiveness in the use of resources Planning Prior to commencement of our first year, the shadow CCG developed financial and activity plans for the year to 31 March 2014. These plans were reviewed by NHS England’s local Area Team. The financial plan set out;  The financial resources available to us  The anticipated expenditure programme based on historic trends and demographic information and delivering the commitments of the NHS constitution  Planned quality, innovation, productivity and prevention measures that would release funds for new investment  Planned investments for the year based on our commissioning intentions  An assessment of the potential financial risks for the year and our options for their mitigation  Areas where we entered into risk sharing agreements with NHS Hartlepool and Stockton on Tees CCG for specific commissioned services  The clear expectation that we would achieve our financial targets for 2013‐14, delivering a 1% surplus, committing no more than 98% of our funding to recurrent programmes and not spending more than £25 per head of population on our administrative costs The CCGs annual plan was reviewed by the Executive then the plan was agreed by our Governing Body in shadow form in March 2013. The plans included reserves set aside that could be used to cover emerging in risks in year. Commissioning and Contracting During the last quarter of 2012‐13 the shadow CCG identified a set of commissioning intentions for 2013‐14 in line with the financial and activity plans. Contracts were negotiated and signed for the majority of commissioned services at the start of 2013‐14. The majority of secondary care contracts were funded on a cost per transaction basis, using the national Payment by Results (PbR) tariffs and locally agreed prices where there was no national PbR tariff. The use of these tariffs means that the CCG is effectively paying providers the national average cost of the service. Contracts for Community Services and Mental Health and Learning Disability services were mainly funded on fixed sum ‘block’ basis. These contract items are mainly based on historical figures and the CCG will need to develop mechanisms to assess value for money in these services. We are starting in 2014‐15 with an external review of how audiology services are charged. We negotiated a quality incentive scheme for each NHS contract linking 2.5% of the contract value to the achievement of agreed quality standards. Quality, Innovation, Productivity and Prevention plans were agreed mainly focussed on reductions in emergency admissions and a potential continued reduction in medicines costs. The CCG planned additional non‐recurring investments during 2013‐14. These investments included;  Additional funding to support an anticipated surge in activity during the winter proposed by South Tees Hospitals NHS Foundation Trust.  A funding process for innovative community projects.  Support for education projects in community and primary care.  Support for system redesign in secondary care emergency admission pathways These investments were in line with our original plans or approved in year following a review of the business case by the executive and Governing Body as appropriate to the level of investment. The CCG developed a process to assess bids for small scale projects that involved local partner bodies, patient representatives and the CCG executive. Performance monitoring Our Governing Body has delegated responsibility for monitoring performance to its Quality, 89 Governance: Economy, Efficiency & Effectiveness Performance and Finance Committee. The membership and terms of reference for this committee are set out on pages 64‐65. The Quality, Performance and Finance Committee receive at each meeting reports on;  the activities of our clinical work streams  a report on the quality metrics of commissioned services at CCG and provider level  a report on performance metrics and issues of commissioned services at CCG and provider level  a report on financial performance of commissioned services including where reserves were utilised to cover overspent plans Provider contractual performance is reviewed in line with the processes contained in the NHS standard contract. The principal meeting for each contract is the Contract Management Board involving members of the CCG’s and the Foundation Trust’s executive and senior management teams. Quality and performance issues are reviewed at Clinical Quality Review Group meetings. Additional operational meetings involve the CCG’s and Foundation Trust management teams and deal with routine data reconciliation issues. Any issues arising are escalated first to the Contract Management Board and then into our corporate governance system at the Quality, Performance and Finance Committee. Any significant issues raised may lead to an ‘Executive to Executive’ meeting with the relevant provider and potentially lead to the application of contract penalties. Our Governing Body receives summary reports on quality and finance at each Governing Body meeting. As part of this process the CCG seeks approval to pay providers contracts where expenditure exceeds the approved plans for the year. Assurance Our performance is subject to continual review by our Internal Audit service and the oversight provided by NHS England’s CCG Assurance process. For the year 2013‐14 Internal Audit have reviewed and found significant assurance in the following areas.  Financial Planning and Budget Setting  Governance and Risk Management  Management of NECS12 service level agreement  Information Governance Toolkit Review In additional we submit monthly financial information to NHS England via the integrated single finance system. The plans and performance of the CCG are reviewed by the NHS England Area Team and their directors participate in quarterly assurance meetings with members of our Governing Body and Executive Team. The NHS England Assurance Framework covers five domains 1. Are local people getting good quality care? 2. Are patient rights under the NHS Constitution being promoted? 3. Are health outcomes improving for local people? 4. Are CCGs delivering services within their financial plans? 5. Are conditions of CCG authorisation being addressed and removed (where relevant)? Performance is assessed against lower level indicators within each domain. The final assessment for the CCG for 2013‐14 will not be completed until autumn 2014. 12
90 North of England Commissioning Support Governance: Review of effectiveness of governance Review of the effectiveness of governance, risk management and internal control Review of 2013‐14 During our first year the mechanisms described above became established routines after the first few months. As we are a new organisation it was inevitable that the early period would see an initial lack of information as the normal timing of data flows meant that activity metrics for the first month would not be available until the end of May 2013. In addition to this the roles of the corporate meetings took a few months to become fully established. We completed and submitted a balanced financial plan in March 2013 in line with NHS England’s timetable. We met with the two Foundation Trusts where the CCG acts as lead commissioner. During the year there were 10 Contract Board Meetings with South Tees Hospitals NHS Foundation Trust and 12 Contract Meeting with Tees, Esk and Wear Valleys NHS Foundation Trust. There were also 8 Clinical Quality Review Group meetings with South Tees Hospitals and we participated in 5 equivalent meetings with Tees, Esk and Wear Valleys Trust. We also participated in the Commissioning Quality Review Group meeting with the North East Ambulance Foundation Trust. We have some smaller contracts with other health care providers in the region. Our interests in these contracts are represented by the local lead commissioner and managers from our commissioning support unit. During the year the CCG had one Executive to Executive meeting with South Tees Hospitals NHS Foundation Trust alongside representatives from other relevant commissioners of the Trust’s services. The purpose of the meeting was to discuss waiting list performance, the number of ‘Never Events’13 in the first part of the year and the 13
Never Events are serious, largely preventable patient safety incidents that should not occur if risks associated with healthcare acquired infections. We also participated in one Executive to Executive meeting with Tees, Esk and Wear Valleys NHS Foundation Trust, to discuss the Monitor14 inquiry into the governance of the Trust. During the first half of the year we participated in a review of allocations made to NHS England for commissioning specialised services. The aim of the review was to validate the allocations for specialised commissioning. This review was conducted with NHS England’s Cumbria, Northumberland, Tyne and Wear Area Team, Darlington, Durham and Tees Area Team and their associated CCGs. The outcome of this review was that we transferred £1.564 million non‐recurringly from our planned contingency to NHS England. The Quality, Performance and Finance Committee met six times and received the three main performance reports at each meeting. From early in the year it was clear that the CCG face two main areas where expenditure was exceeding plan. The anticipated savings on medicines, and primary care saw increases in some drug costs. The other area was an increase in demand and costs of continuing health care packages. These pressures were reported to the Governing Body during the year and the CCGs reserves were used to mitigate the costs. Our administrative budget for 2013‐14 was £6.9 million; we only spent £5.9 million on our management costs. We were able to transfer the unspent funds to support commissioned services. At 31 March 2014 the CCG had met its financial target of delivering a 1% surplus. As described during the year we used the 0.5% planned contingency to mitigate the financial risk associated with specialised services across the North East health economy. the available preventative measures have been implemented. 14
Monitor is the organisation that regulates Foundation Trusts 91 Governance: Review of effectiveness of governance Plans for the future Our planning process has continued to develop during 2013‐14 culminating in the production of our five year plan covering the period 2014‐19. The plans for 2014‐15 have been developed from a review of the final position in 2013‐14 and a new assessment of the opportunities for efficiencies We will face many challenges over this period including;  Anticipated low levels of funding growth combined with increased demand for services over the five years  Working with our Local Authority partners and Health and Wellbeing 92 
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Boards to improve the integration of health and social care Commissioning a range of primary and community care and other sector services that will reduce our dependency on hospital based unplanned care Working with NHS Property Services Ltd to resolve the issues surrounding the legacy estate facilities on our patch Independent Auditor’s Report INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF SOUTH TEES CLINICAL COMMISSIONING GROUP We have audited the financial statements of South Tees Clinical Commissioning Group (the CCG) for the year ended 31 March 2014 under the Audit Commission Act 1998. The financial statements comprise the Statement of Comprehensive Net Expenditure, the Statement of Financial Position, the Statement of Changes in Taxpayers’ Equity, the Statement of Cash Flows and the related notes 1 to 44. The financial reporting framework that has been applied in their preparation is applicable law and the accounting policies directed by the Secretary of State with the consent of the Treasury as relevant to the National Health Service in England. We have also audited the information in the Remuneration Report that is subject to audit, being:  the table of salaries and allowances of senior managers and related narrative notes on page 71; 
the table of pension benefits of senior managers and related narrative notes on pages 72 to 73; and 
the table of pay multiples and related narrative notes on page 71. This report is made solely to the members of South Tees Clinical Commissioning Group in accordance with Part II of the Audit Commission Act 1998 and for no other purpose, as set out in paragraph 44 of the Statement of Responsibilities of Auditors and Audited Bodies published by the Audit Commission in March 2014. Our audit work has been undertaken so that we might state to the CCG those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the CCG, as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of the Accountable Officer and auditor As explained more fully in the Statement of Accountable Officer’s Responsibilities, the Accountable Officer is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors. Scope of the audit of the financial statements An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the CCG’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the CCG; and the overall presentation of the financial statements. In addition, we read all the financial and non‐financial information in the annual report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. 93 Independent Auditor’s Report In addition, we are required to obtain evidence sufficient to give reasonable assurance that the expenditure and income reported in the financial statements have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them. Opinion on regularity In our opinion, in all material respects the expenditure and income have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them. Opinion on financial statements In our opinion the financial statements:  give a true and fair view of the financial position of South Tees Clinical Commissioning Group as at 31 March 2014 and of its net operating costs for the year then ended; and  have been prepared properly in accordance with the accounting policies directed by the NHS Commissioning Board with the approval of the Secretary of State. Opinion on other matters In our opinion:  the part of the Remuneration Report subject to audit has been prepared properly in accordance with the requirements directed by the NHS Commissioning Board with the approval of the Secretary of State; and  the information given in the annual report for the financial year for which the financial statements are prepared is consistent with the financial statements. Matters on which we report by exception We report to you if:  in our opinion the governance statement does not reflect compliance with NHS England’s Guidance;  we refer the matter to the Secretary of State under section 19 of the Audit Commission Act 1998 because we have a reason to believe that the CCG, or an officer of the CCG, is about to make, or has made, a decision involving unlawful expenditure, or is about to take, or has taken, unlawful action likely to cause a loss or deficiency; or  we issue a report in the public interest under section 8 of the Audit Commission Act 1998. We have nothing to report in these respects. Conclusion on the CCG’s arrangements for securing economy, efficiency and effectiveness in the use of resources We are required under Section 5 of the Audit Commission Act 1998 to satisfy ourselves that the CCG has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources. The Code of Audit Practice issued by the Audit Commission requires us to report any matters that prevent us being satisfied that the audited body has put in place such arrangements. 94 Independent Auditor’s Report We have undertaken our audit in accordance with the Code of Audit Practice, having regard to the guidance issued by the Audit Commission in October 2013. We have considered the results of the following:  our review of the Governance Statement;  the work of other relevant regulatory bodies or inspectorates, to the extent that the results of this work impact on our responsibilities at the CCG; and  locally determined risk‐based work. As a result, we have concluded that there are no matters to report. Certificate We certify that we have completed the audit of the accounts of South Tees Clinical Commissioning Group in accordance with the requirements of the Audit Commission Act 1998 and the Code of Audit Practice issued by the Audit Commission. David Wilkinson (Engagement Lead) for and on behalf of Deloitte LLP, Appointed Auditor, One Trinity Gardens, Broad Chare, Newcastle‐upon‐Tyne NE1 2HF 6 June 2014 95 Financial Statements Index Financial Statements The Primary Statements Statement of Comprehensive Net Expenditure for the year ended 31 March 2014 ..................... 97 Statement of Financial Position as at 31 March 2014 .................................................................... 98 Statement of Changes in Taxpayers Equity for the year ended 31 March 2014 ............................ 99 Statement of Cash Flows for the year ended 31 March 2014 ...................................................... 100 Notes to the Accounts 1 Accounting Policies ................................................................................................................ 101 2 Other Operating Revenue ...................................................................................................... 110 3 Revenue ................................................................................................................................. 110 4. Employee benefits and staff numbers .................................................................................. 111 4.5 Pension costs ....................................................................................................................... 113 5. Operating expenses .............................................................................................................. 115 6.1 Better Payment Practice Code ............................................................................................ 116 7 Income Generation Activities ................................................................................................. 116 8. Investment revenue .............................................................................................................. 116 9. Other gains and losses .......................................................................................................... 116 10. Finance costs ....................................................................................................................... 116 11. Net gain/ (loss) on transfer by absorption .......................................................................... 116 12. Operating Leases ................................................................................................................. 117 13 Property, plant and equipment ........................................................................................... 118 14 Intangible non‐current assets .............................................................................................. 119 15 Investment property ............................................................................................................ 119 16 Inventories ........................................................................................................................... 119 17 Trade and other receivables ................................................................................................ 120 18 Other financial assets ........................................................................................................... 120 19 Other current assets ............................................................................................................ 120 20 Cash and cash equivalents ................................................................................................... 121 21 Non‐current assets held for sale .......................................................................................... 121 22 Analysis of impairments and reversals ................................................................................ 122 23 Trade and other payables .................................................................................................... 122 24 Other financial liabilities ...................................................................................................... 122 25 Other liabilities ..................................................................................................................... 122 26 Borrowings ........................................................................................................................... 122 27 Private finance initiative, LIFT and other service concession arrangements ....................... 122 28 Finance lease obligations ..................................................................................................... 122 29 Finance lease receivables ..................................................................................................... 122 30 Provisions ............................................................................................................................. 122 31 Contingencies ....................................................................................................................... 122 32 Commitments ...................................................................................................................... 122 33 Financial instruments ........................................................................................................... 123 34 Operating segments ............................................................................................................. 125 35 Pooled budgets .................................................................................................................... 125 36 NHS Lift investments ............................................................................................................ 125 37 Intra‐government and other balances ................................................................................. 125 38 Related party transactions ................................................................................................... 126 39 Events after the end of the reporting period ....................................................................... 127 40 Losses and special payments ............................................................................................... 127 41 Third party assets ................................................................................................................. 127 42 Financial performance targets ............................................................................................. 127 43 Impact of IFRS ...................................................................................................................... 127 44 Analysis of charitable reserves ............................................................................................. 127 96 Financial Statements: Statement of Comprehensive Net Expenditure Statement of Comprehensive Net Expenditure for the year ended 31 March 2014 Note Administration Costs and Programme Expenditure Gross employee benefits Other costs Other operating revenue Net operating costs before interest 4.1 5 2 2013‐14 £000 1,103
387,716
(5,343)
383,476 Net operating costs for the financial year 383,476 Net (gain)/loss on transfers by absorption Net operating costs for the financial year including absorption transfers ‐
383,476 Of which: Administration Costs Gross employee benefits Other costs Other operating revenue Net administration costs before interest Programme Expenditure Gross employee benefits Other costs Other operating revenue Net programme expenditure before interest Other Comprehensive Net Expenditure Total comprehensive net expenditure for the year 4.1 5 2 970 4,914
‐
5,884
4.1 5 2 133
382,802 (5,343)
377,592
2013‐14 £000 383,476 The notes on pages 101 to 127 form part of this statement.
97 Financial Statements: Statement of Financial Position Statement of Financial Position as at
31 March 2014 31 March 2014
Note Non‐current assets: Total non‐current assets ‐
Current assets: Trade and other receivables Cash and cash equivalents Total current assets Total assets Current liabilities Trade and other payables Total current liabilities Total Assets less Current Liabilities 17 20 1,655 213 1,868 1,868 23 18,650
18,650
(16,782)
Non‐current liabilities Total non‐current liabilities ‐
Total Assets Employed (16,782)
Financed by Taxpayers’ Equity General fund Total taxpayers' equity: (16,782)
(16,782)
The notes on pages 101 to 127 form part of this statement. The financial statements on pages 97 to 100 were approved by the Governing Body on 6 June 2014 and signed on its behalf by: Chief Officer & Accountable Officer Amanda Hume 98 £000
Financial Statements: Statement of Changes in Taxpayers Equity Statement of Changes in Taxpayers Equity for the year ended 31 March 2014 Changes in CCG taxpayers’ equity for 2013‐14 Net operating costs for the financial year Net Recognised CCG Expenditure for the Financial Year Net funding Balance at 31 March 2014 General fund Total reserves £000 £000 (383,476)
(383,476)
(383,476)
366,695 (16,782)
(383,476)
366,695 (16,782)
99 Financial Statements: Statement of Cash Flows Statement of Cash Flows for the year ended
31 March 2014 Note Cash Flows from Operating Activities Net operating costs for the financial year Increase in trade & other receivables Increase in trade & other payables Net Cash Outflow from Operating Activities (383,476)
(1,655)
18,649 (366,482)
Cash Flows from Investing Activities Net Cash Inflow from Investing Activities ‐
Net Cash Outflow before Financing (366,482)
Cash Flows from Financing Activities Net funding received Net Cash Inflow from Financing Activities 366,695 366,695 Net Increase in Cash & Cash Equivalents 100 2013‐14
£000
20 213 Cash & Cash Equivalents at the Beginning of the Financial Year ‐
Cash & Cash Equivalents (including bank overdrafts) at the End of the Financial Year 213 Financial Statements: Note 1 Notes to the financial statements
1 Accounting Policies 1.1 1.2 1.3 NHS England has directed that the financial statements of Clinical Commissioning Groups shall meet the accounting requirements of the Manual for Accounts issued by the Department of Health. Consequently, the following financial statements have been prepared in accordance with the Manual for Accounts 2013‐14 issued by the Department of Health. The accounting policies contained in the Manual for Accounts follow International Financial Reporting Standards to the extent that they are meaningful and appropriate to Clinical Commissioning Groups, as determined by HM Treasury, which is advised by the Financial Reporting Advisory Board. Where the Manual for Accounts permits a choice of accounting policy, the accounting policy which is judged to be most appropriate to the particular circumstances of the Clinical Commissioning Group for the purpose of giving a true and fair view has been selected. The particular policies adopted by the Clinical Commissioning Group are described below. They have been applied consistently in dealing with items considered material in relation to the accounts. In accordance with the Directions issued by NHS England comparative information is not provided in these Financial Statements. The accounting arrangements for balances transferred from predecessor PCTs ("legacy" balances) are determined by the Accounts Direction issued by NHS England on 12 February 2014. The Accounts Directions state that the only legacy balances to be accounted for by the clinical commissioning group are in respect of property, plant and equipment (and related liabilities) and inventories. All other legacy balances in respect of assets or liabilities arising from transactions or delivery of care prior to 31 March 2013 are accounted for by NHS England. The clinical commissioning groups's arrangements in respect of settling NHS Continuing Healthcare claims are disclosed in note 30 to these financial statements. Going Concern These accounts have been prepared on the going concern basis. Public sector bodies are assumed to be going concerns where the continuation of the provision of a service in the future is anticipated, as evidenced by inclusion of financial provision for that service in published documents. Where a Clinical Commissioning Group ceases to exist, it considers whether or not its services will continue to be provided (using the same assets, by another public sector entity) in determining whether to use the concept of going concern for the final set of Financial Statements. If services will continue to be provided the financial statements are prepared on the going concern basis. Accounting Convention These accounts have been prepared under the historical cost convention modified to account for the revaluation of property, plant and equipment, intangible assets, inventories and certain financial assets and financial liabilities. Acquisitions & Discontinued Operations Activities are considered to be ‘acquired’ only if they are taken on from outside the public sector. Activities are considered to be ‘discontinued’ only if they cease entirely. They are not considered to be ‘discontinued’ if they transfer from one public sector body to another. 101 Financial Statements: Note 1 1.4 Movement of Assets within the Department of Health Group Transfers as part of reorganisation fall to be accounted for by use of absorption accounting in line with the Government Financial Reporting Manual, issued by HM Treasury. The Government Financial Reporting Manual does not require retrospective adoption, so prior year transactions (which have been accounted for under merger accounting) have not been restated. Absorption accounting requires that entities account for their transactions in the period in which they took place, with no restatement of performance required when functions transfer within the public sector. Where assets and liabilities transfer, the gain or loss resulting is recognised in the Statement of Comprehensive Net Expenditure, and is disclosed separately from operating costs. Other transfers of assets and liabilities within the Department of Health Group are accounted for in line with IAS 20 and similarly give rise to income and expenditure entries. For transfers of assets and liabilities from those NHS bodies that closed on 1 April 2013, HM Treasury has agreed that a modified absorption approach should be applied. For these transactions only, gains and losses are recognised in reserves rather than the Statement of Comprehensive Net Expenditure. 1.5 Charitable Funds From 2013‐14, the divergence from the Government Financial Reporting Manual that NHS Charitable Funds are not consolidated with bodies’ own returns is removed. Under the provisions of IAS 27: Consolidated & Separate Financial Statements, those Charitable Funds that fall under common control with NHS bodies are consolidated within the entities’ accounts. The clinical commissioning group does not hold any charitable funds as at 31st March 2014. 1.6 Pooled Budgets The clinical commissioning group is party to a pooled budget arrangement in relation to the loan of community equipment. The pool is hosted by Middlesbrough Council. As a commissioner of healthcare services, the clinical commissioning group makes contributions to the pool that are then used to purchase healthcare services. Annual contributions to the pool are £167,000. 1.7 Critical Accounting Judgements & Key Sources of Estimation Uncertainty In the application of the Clinical Commissioning Group’s accounting policies, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from those estimates and the estimates and underlying assumptions are continually reviewed. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. 1.7.1 Key Sources of Estimation Uncertainty The following are the key estimations that management has made in the process of applying the Clinical Commissioning Group’s accounting policies that have the most significant effect on the amounts recognised in the financial statements: Examples include; prescribing, continuing healthcare, non‐contracted activity, work in progress. 1.8 Revenue Revenue in respect of services provided is recognised when, and to the extent that, performance occurs, and is measured at the fair value of the consideration receivable. Where income is received for a specific activity that is to be delivered in the following year, that income is deferred. 102 Financial Statements: Note 1 1.9 Employee Benefits 1.9.1 Short‐term Employee Benefits Salaries, wages and employment‐related payments are recognised in the period in which the service is received from employees, including bonuses earned but not yet taken. 1.9.2 Retirement Benefit Costs Past and present employees are covered by the provisions of the NHS Pensions Scheme. 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: the cost to the Clinical Commissioning Group of participating in the scheme is taken as equal to the contributions payable to the scheme for the accounting period. 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 expenditure at the time the Clinical Commissioning Group commits itself to the retirement, regardless of the method of payment. 1.10 Other Expenses Other operating expenses are recognised when, and to the extent that, the goods or services have been received. They are measured at the fair value of the consideration payable. Expenses and liabilities in respect of grants are recognised when the Clinical Commissioning Group has a present legal or constructive obligation, which occurs when all of the conditions attached to the payment have been met. 1.11 Property, Plant & Equipment 1.11.1 Recognition Property, plant and equipment is capitalised if: ∙ It is held for use in delivering services or for administrative purposes; ∙ It is probable that future economic benefits will flow to, or service potential will be supplied to the Clinical Commissioning Group; ∙ It is expected to be used for more than one financial year; ∙ The cost of the item can be measured reliably; and, ∙ The item has a cost of at least £5,000; or, ∙ Collectively, a number of items 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, ∙ Items form part of the initial equipping and setting‐up cost of a new building, ward or unit, irrespective of their individual or collective cost. Where a large asset, for example a building, includes a number of components with significantly different asset lives, the components are treated as separate assets and depreciated over their own useful economic lives. Following the demise of Primary Care Trusts, there were no property, plant and equipment assets transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 103 Financial Statements: Note 1 1.12 Intangible Assets 1.12.1 Recognition Intangible assets are non‐monetary assets without physical substance, which are capable of sale separately from the rest of the Clinical Commissioning Group’s business or which arise from contractual or other legal rights. They are recognised only: ∙ When it is probable that future economic benefits will flow to, or service potential be provided to, the Clinical Commissioning Group; ∙ Where the cost of the asset can be measured reliably; and, ∙ Where the cost is at least £5,000. Following the demise of Primary Care Trusts, there were no intangible assets transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 1.13 Depreciation, Amortisation & Impairments Following the demise of Primary Care Trusts, there were no depreciation, amortisation or impairment values transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 1.14 Donated Assets Following the demise of Primary Care Trusts, there were no donated assets transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 1.15 Government Grants Following the demise of Primary Care Trusts, there were no government grants transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 1.16 Non‐current Assets Held For Sale Non‐current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met when: ∙ The sale is highly probable; ∙ The asset is available for immediate sale in its present condition; and, ∙ Management is committed to the sale, which is expected to qualify for recognition as a completed sale within one year from the date of classification. Following the demise of Primary Care Trusts, there were no non‐current assets held for sale transferred to the Clinical Commissioning Group at the start of the financial year 2013/14. 1.17 Leases Leases are classified as finance leases when substantially all the risks and rewards of ownership are transferred to the lessee. All other leases are classified as operating leases. 1.17.1 The Clinical Commissioning Group as Lessee Operating lease payments are recognised as an expense on a straight‐line basis over the lease term. Lease incentives are recognised initially as a liability and subsequently as a reduction of rentals on a straight‐line basis over the lease term. Contingent rentals are recognised as an expense in the period in which they are incurred. Where a lease is for land and buildings, the land and building components are separated and individually assessed as to whether they are operating or finance leases. 1.18 Private Finance Initiative Transactions Following the demise of Primary Care Trusts, all PFI agreements held by the demised Primary Care Trusts transferred to Community Health Partnership and the clinical commissioning group does not hold any lift investments. 1.19 Inventories Inventories are valued at the lower of cost and net realisable value using the first‐in first‐out cost formula. This is considered to be a reasonable approximation to fair value due to the high turnover of stocks. The Clinical Commissioning Group does not hold any stock as at 31st March 2014. 104 Financial Statements: Note 1 1.20 Cash & Cash Equivalents Cash is cash in hand and deposits with any financial institution repayable without penalty on notice of not more than 24 hours. Cash equivalents are investments that mature in 3 months or less from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and that form an integral part of the Clinical Commissioning Group’s cash management. 1.21 Provisions Provisions are recognised when the Clinical Commissioning Group has a present legal or constructive obligation as a result of a past event, it is probable that the Clinical Commissioning Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the expenditure required to settle the obligation at the end of the reporting period, taking into account the risks and uncertainties. Where a provision is measured using the cash flows estimated to settle the obligation, its carrying amount is the present value of those cash flows using HM Treasury’s discount rate as follows: ∙ Timing of cash flows (0 to 5 years inclusive): Minus 1.90% ∙ Timing of cash flows (6 to 10 years inclusive): Minus 0.65% ∙ Timing of cash flows (over 10 years): Plus 2.20% ∙ All employee early departures: 1.80% When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursements will be received and the amount of the receivable can be measured reliably. A restructuring provision is recognised when the Clinical Commissioning Group has developed a detailed formal plan for the restructuring and has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or announcing its main features to those affected by it. The measurement of a restructuring provision includes only the direct expenditures arising from the restructuring, which are those amounts that are both necessarily entailed by the restructuring and not associated with on‐going activities of the entity. The clinical commissioning group does not hold any provisions in the 2013/14 accounts. The previous PCT provisions for restitution of Continuing Healthcare, relating to clinical commissioning group services, is now held centrally with NHS England and will be accounted for in NHS England accounts. 1.22 Clinical Negligence Costs The NHS Litigation Authority operates a risk pooling scheme under which the Clinical Commissioning Group pays an annual contribution to the NHS Litigation Authority which in return settles all clinical negligence claims. The contribution is charged to expenditure. Although the NHS Litigation Authority is administratively responsible for all clinical negligence cases the legal liability remains with the Clinical Commissioning Group. 1.23 Non‐clinical Risk Pooling The Clinical Commissioning Group participates in the Property Expenses Scheme and the Liabilities to Third Parties Scheme. Both are risk pooling schemes under which the Clinical Commissioning Group 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. 105 Financial Statements: Note 1 1.24 Carbon Reduction Commitment Scheme Carbon Reduction Commitment and similar allowances are accounted for as government grant funded intangible assets if they are not expected to be realised within twelve months, and otherwise as other current assets. They are valued at open market value. As the Clinical Commissioning Group makes emissions, a provision is recognised with an offsetting transfer from deferred income. The provision is settled on surrender of the allowances. The asset, provision and deferred income amounts are valued at fair value at the end of the reporting period 1.25 Contingencies A contingent liability is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non‐occurrence of one or more uncertain future events not wholly within the control of the Clinical Commissioning Group, or a present obligation that is not recognised because it is not probable that a payment will be required to settle the obligation or the amount of the obligation cannot be measured sufficiently reliably. A contingent liability is disclosed unless the possibility of a payment is remote. A contingent asset is a possible asset that arises from past events and whose existence will be confirmed by the occurrence or non‐occurrence of one or more uncertain future events not wholly within the control of the Clinical Commissioning Group. A contingent asset is disclosed where an inflow of economic benefits is probable. Where the time value of money is material, contingencies are disclosed at their present value. The Clinical Commissioning Group has no contingencies as at 31st March 2014. 1.26 Financial Assets Financial assets are recognised when the Clinical Commissioning Group 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 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. 1.26.1 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 calculating the Clinical Commissioning Group’s surplus or deficit for the year. The net gain or loss incorporates any interest earned on the financial asset. 1.26.2 Held to Maturity Assets Held to maturity investments are non‐derivative financial assets with fixed or determinable payments and fixed maturity, and there is a positive intention and ability to hold to maturity. After initial recognition, they are held at amortised cost using the effective interest method, less any impairment. Interest is recognised using the effective interest method. 106 Financial Statements: Note 1 1.26 Financial Assets (continued) 1.26.3 Available For Sale Financial Assets Available for sale financial assets are non‐derivative financial assets that are designated as available for sale or that do not fall within any of the other three financial asset classifications. They are measured at fair value with changes in value taken to the revaluation reserve, with the exception of impairment losses. Accumulated gains or losses are recycled to surplus/deficit on de‐recognition. 1.26.4 Loans & 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 initial fair value of the financial asset. At the end of the reporting period, the Clinical Commissioning Group 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 expenditure and the carrying amount of the asset is reduced 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 impairment was recognised, the previously recognised impairment loss is reversed through expenditure 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. 1.27 Financial Liabilities Financial liabilities are recognised on the statement of financial position when the Clinical Commissioning Group 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. Loans from the Department of Health are recognised at historical cost. Otherwise, financial liabilities are initially recognised at fair value. 1.27.1 Financial Guarantee Contract Liabilities Financial guarantee contract liabilities are subsequently measured at the higher of: ∙ The premium received (or imputed) for entering into the guarantee less cumulative amortisation; and, ∙ The amount of the obligation under the contract, as determined in accordance with IAS 37: Provisions, Contingent Liabilities and Contingent Assets. 1.27.2 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 Clinical Commissioning Group’s surplus/deficit. The net gain or loss incorporates any interest payable on the financial liability. 107 Financial Statements: Note 1 1.27 Financial Liabilities (continued) 1.27.3 Other Financial Liabilities After initial recognition, all other financial liabilities are measured at amortised cost using the effective interest method, except for loans from the Department of Health, which are carried at historic cost. 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. 1.28 Value Added Tax Most of the activities of the Clinical Commissioning Group 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. 1.29 Foreign Currencies The Clinical Commissioning Group’s functional currency and presentational currency is sterling. Transactions denominated in a foreign currency are translated into sterling at the exchange rate ruling on the dates of the transactions. At the end of the reporting period, monetary items denominated in foreign currencies are retranslated at the spot exchange rate on 31 March. Resulting exchange gains and losses for either of these are recognised in the Clinical Commissioning Group’s surplus/deficit in the period in which they arise. The Clinical Commissioning Group has no foreign currency transactions as at 31st March 2014. 1.30 Third Party Assets Assets belonging to third parties (such as money held on behalf of patients) are not recognised in the accounts since the Clinical Commissioning Group has no beneficial interest in them. The Clinical Commissioning Group has no third party assets as at 31st March 2014. 1.31 Losses & 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 that individual cases are handled. Losses and special payments are charged to the relevant functional headings in expenditure on an accruals basis, including losses which would have been made good through insurance cover had the Clinical Commissioning Group not been bearing its own risks (with insurance premiums then being included as normal revenue expenditure). The Clinical Commissioning Group has not made any losses and special payments during 2013/14. 1.32 Subsidiaries Material entities over which the Clinical Commissioning Group has the power to exercise control so as to obtain economic or other benefits are classified as subsidiaries and are consolidated. Their income and expenses; gains and losses; assets, liabilities and reserves; and cash flows are consolidated in full into the appropriate financial statement lines. Appropriate adjustments are made on consolidation where the subsidiary’s accounting policies are not aligned with the Clinical Commissioning Group or where the subsidiary’s accounting date is not co‐terminus. Subsidiaries that are classified as ‘held for sale’ are measured at the lower of their carrying amount or ‘fair value less costs to sell’. The Clinical Commissioning Group has no subsidiary arrangement as at 31st March 2014. 108 Financial Statements: Note 1 1.33 Associates Material entities over which the Clinical Commissioning Group has the power to exercise significant influence so as to obtain economic or other benefits are classified as associates and are recognised in the Clinical Commissioning Group’s accounts using the equity method. The investment is recognised initially at cost and is adjusted subsequently to reflect the Clinical Commissioning Group’s share of the entity’s profit/loss and other gains/losses. It is also reduced when any distribution is received by the Clinical Commissioning Group from the entity. The Clinical Commissioning Group has no associate arrangement as at 31st March 2014. 1.34 Joint Ventures Material entities over which the Clinical Commissioning Group has joint control with one or more other parties so as to obtain economic or other benefits are classified as joint ventures. Joint ventures are accounted for using the equity method. Joint ventures that are classified as ‘held for sale’ are measured at the lower of their carrying amount or ‘fair value less costs to sell’. The Clinical Commissioning Group has no joint venture arrangement as at 31st March 2014. 1.35 Joint Operations Joint operations are activities undertaken by the Clinical Commissioning Group in conjunction with one or more other parties but which are not performed through a separate entity. The Clinical Commissioning Group records its share of the income and expenditure; gains and losses; assets and liabilities; and cash flows. The Clinical Commissioning Group has no joint operations arrangement as at 31st March 2014. 1.36 Research & Development Research and development expenditure is charged in the year in which it is incurred, except insofar as development expenditure relates to a clearly defined project and the benefits of it can reasonably be regarded as assured. Expenditure so deferred is limited to the value of future benefits expected and is amortised through the Statement of Comprehensive Net Expenditure on a systematic basis over the period expected to benefit from the project. It should be re‐valued on the basis of current cost. The amortisation is calculated on the same basis as depreciation. The Clinical Commissioning Group had no research and development expenditure during 2013/14. 1.37 Accounting Standards That Have Been Issued But Have Not Yet Been Adopted The Government Financial Reporting Manual does not require the following Standards and Interpretations to be applied in 2013‐14, all of which are subject to consultation: ∙ IAS 27: Separate Financial Statements ∙ IAS 28: Investments in Associates & Joint Ventures ∙ IAS 32: Financial Instruments – Presentation (amendment) ∙ IFRS 9: Financial Instruments ∙ IFRS 10: Consolidated Financial Statements ∙ IFRS 11: Joint Arrangements ∙ IFRS 12: Disclosure of Interests in Other Entities ∙ IFRS 13: Fair Value Measurement The application of the Standards as revised would not have a material impact on the accounts for 2013‐14, were they applied in that year. 109 Financial Statements: Notes 2‐3 2 Other Operating Revenue Non‐patient care services to other bodies Other revenue Total other operating revenue 2013‐14 Total 2013‐14 Admin 2013‐14 Programme £000 £000 £000 5,043 300 5,343 ‐ ‐ ‐ 5,043 300 5,343 Admin revenue is revenue received that is not directly attributable to the provision of healthcare or healthcare services. Revenue in this note does not include cash received from NHS England, which is drawn down directly into the bank account of the Clinical Commissioning Group and credited to the General Fund. 3 Revenue Revenue is totally from the supply of services. The Clinical Commissioning Group receives no revenue from the sale of goods. 110 111 £000 £000 ‐ ‐ 1,103 970 Less: Employee costs capitalised Net employee benefits excluding capitalised costs ‐ 1,103 ‐ ‐ 1,103 970 Less recoveries in respect of employee benefits ‐ Total ‐ Net admin employee benefits including capitalised costs 1,103 £000 Total 927 815 73 63 103 92 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 1,103 970 Total Permanent Employees
2013‐14 Total 927 73 103 ‐ ‐ ‐ ‐ 1,103 Employee Benefits Salaries and wages Social security costs Employer Contributions to NHS Pension scheme Other pension costs Other post‐employment benefits Other employment benefits Termination benefits Gross employee benefits expenditure 4.1.1 Employee benefits 4. Employee benefits and staff numbers
£000 Total ‐ ‐ 970 133 ‐ ‐ 970 133 815 112 63 10 92 11 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 970 133 £000 Admin Permanent Employees
‐
133
‐
133
112 10 11 ‐
‐
‐
‐
133
£000 Programme Permanent Employees Financial Statements: Note 4 Financial Statements: Notes 4.2 to 4.4 4.2 Average number of people employed
2013‐14 Total Number Total 18 Permanently employed Other Number Number
16 2 4.3 Staff sickness absence and ill health retirements
2013‐14 Number 46
16
3
Total Days Lost Total Staff Years Average working Days Lost The sickness figures are for the period April ‐ December 2013 The Clinical Commissioning Group had no ill health retirement costs during 2013/14. 4.4 Exit packages agreed in the financial year
The Clinical Commissioning Group had no exit packages during 2013/14. 112 Financial Statements: Notes 4.5 4.5 Pension costs Past and present employees are covered by the provisions of the NHS Pension 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, GP 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: the cost to the Clinical Commissioning Group 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, every five years) and an accounting valuation every year. An outline of these follows: 4.5.1 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. In order to defray the costs of benefits, employers pay contributions at 14% of Pensionable pay and most employees had up to April 2008 paid 6%, with manual staff paying 5%. Following the full actuarial review by the Government Actuary undertaken as at 31 March 2004, and after consideration of changes to the NHS Pension Scheme taking effect from 1 April 2008, his Valuation report recommended that employer contributions could continue at the existing rate of 14% of Pensionable pay, from 1 April 2008, following the introduction of employee contributions on a tiered scale from 5% up to 8.5% of their Pensionable pay depending on total earnings. On advice from the scheme actuary, scheme contributions may be varied from time to time to reflect changes in the scheme’s liabilities. 4.5.2 Accounting valuation A valuation of the scheme liability is carried out annually by the scheme actuary as at the end of the reporting period 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 2011 is based on detailed membership data as at 31 March 2008 (the latest midpoint) updated to 31 March 2011 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. 113 Financial Statements: Note 4.5 4.5 Pension costs (continued) 4.5.3 Scheme Provisions The NHS Pension Scheme provides defined benefits, which are summarised below. This list is an illustrative guide only, and is not intended to detail all the benefits provided by the Scheme or the specific conditions that must be met before these benefits can be obtained: • The Scheme is a “final salary” scheme. Annual pensions are normally based on 1/80th for the 1995 section and of the best of the last three years pensionable pay for each year of service, and 1/60th for the 2008 section of reckonable pay per year of membership. Members who are practitioners as defined by the Scheme Regulations have their annual pensions based upon total pensionable earnings over the relevant pensionable service; • With effect from 1 April 2008 members can choose to give up some of their annual pension for an additional tax free lump sum, up to a maximum amount permitted under HM Revenue & Customs rules. This new provision is known as “pension commutation”; • 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; • Early payment of a pension, with enhancement, 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 is payable; • 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 statement of comprehensive net expenditure at the time the Clinical Commissioning Group commits itself to the retirement, regardless of the method of payment; and, • Members can purchase additional service in the Scheme and contribute to money purchase AVC’s run by the Scheme’s approved providers or by other Free Standing Additional Voluntary Contributions (FSAVC) providers. 114 Financial Statements: Note 5 5. Operating expenses 2013‐14 Total £000 Gross employee benefits Employee benefits excluding Governing Body members
Executive Governing Body members Total gross employee benefits Other costs Services from other CCGs and NHS England Services from foundation trusts Services from other NHS trusts Services from other NHS bodies Purchase of healthcare from non‐NHS bodies Chair and lay membership body and Governing Body members Supplies and services – clinical Supplies and services – general Consultancy services Establishment Transport Premises Audit fees Other auditor’s remuneration ∙ Internal audit services Prescribing costs Pharmaceutical Services General ophthalmic Services GPMS/APMS and PCTMS Other professional fees excl. audit Clinical negligence Education and training Total other costs Total operating expenses 2013‐14 2013‐14 Admin Programme
£000 £000 497 364 606 606 1,103 970 133
‐
133
6,768 4,040 2,728 274,193 ‐ 274,193
759 ‐
759 75 ‐
75 46,042 ‐ 46,042 149 149 960 ‐
146 28 18 18 62 60
1 1 5,763 175 104 104 ‐
960 118 ‐
2 ‐
5,588 ‐
30 30 51,527 ‐
12 ‐
100 ‐
671 ‐
272 272
6 6 59 32
‐
51,527 12 100 671 ‐
‐
27 387,716 4,914
382,802 388,819 5,884 382,935 Admin expenditure is expenditure incurred that is not a direct payment for the provision of healthcare or healthcare services. Other professional fees of £272,000 relate to: ‐ GP clinical engagement £228,000 ‐ Patient engagement with Black, Minority, Ethnic communities £10,000 ‐ Legal fees £34,000 115 Financial Statements: Note 6.1 to 11 6.1 Better Payment Practice Code
Measure of compliance 2013‐14 Number 2013‐14 £000 Non‐NHS Payables Total Non‐NHS Trade invoices paid in the Year Total Non‐NHS Trade Invoices paid within target Percentage of Non‐NHS Trade invoices paid within target 6,485 47,278 6,376 46,703 98.32%
98.78%
NHS Payables Total NHS Trade Invoices Paid in the Year Total NHS Trade Invoices Paid within target Percentage of NHS Trade Invoices paid within target 1,319 285,063 1,302 284,967 98.71%
99.97%
The Better Payment Practice Code requires the Clinical Commissioning Group to aim to pay all valid invoices by the due date or within 30 days of receipt of a valid invoice, whichever is later. 6.2 The Late Payment of Commercial Debts (Interest) Act 1998 In 2013/14 the Clinical Commissioning Group has no late payment of Commercial Debts. 7 Income Generation Activities
The Clinical Commissioning Group does not undertake any income generation activities. 8. Investment revenue The Clinical Commissioning Group does not have any investment revenue as at 31st March 2014. 9. Other gains and losses The Clinical Commissioning Group does not have any other gains and losses as at 31st March 2014 10. Finance costs The Clinical Commissioning Group does not have any finance costs as at 31st March 2014. 11. Net gain/ (loss) on transfer by absorption
The Clinical Commissioning Group has no net gain/ (loss) on transfer by absorption as at 31st March 2014. 116 Financial Statements: Note 12 12. Operating Leases 12.1 As lessee The significant operating lease represented in the figure below is in relation to NHS Property Services. 12.1.1 Payments recognised as an Expense 2013‐14 Buildings
£000 Payments recognised as an expense Minimum lease payments Contingent rents Sub‐lease payments Total 5,735 ‐
‐
5,735 Other
£000
2 ‐
‐
2 12.1.2 Future minimum lease payments 5,737
‐
‐
5,737
2013‐14 Buildings
£000 Payable: No later than one year Between one and five years After five years Total Total £000 ‐
‐
‐
‐
Other
£000
‐
‐
‐
‐
Total £000 ‐
‐
‐
‐
The clinical commissioning group occupies property owned and managed by NHS Property Services Ltd. For 2013‐14, a transitional occupancy rent based on annual property cost allocations was agreed. This is reflected in Note 12.1.1. While our arrangements with NHS Property Services Ltd fall within the definition of operating leases, the rental charge for future years has not yet been agreed.
12.2 As lessor The Clinical Commissioning Group has no lessor arrangement. 117 Financial Statements: Note 13 13 Property, plant and equipment
The Clinical Commissioning Group does not have any property, plant or equipment as at 31st March 2014. 13.1 Additions to assets under construction The Clinical Commissioning Group does not have any assets under construction as at 31st March 2014. 13.2 Donated assets The Clinical Commissioning Group does not have any donated assets as at 31st March 2014. 13.3 Government granted assets The Clinical Commissioning Group does not have any government granted assets as at 31st March 2014. 13.4 Property revaluation The Clinical Commissioning Group does not have any property revaluation as at 31st March 2014. 13.5 Compensation from third parties The Clinical Commissioning Group does not have any compensation from third parties as at 31st March 2014. 13.6 Write downs to recoverable amount The Clinical Commissioning Group does not have any assets which have been written down as at 31st March 2014. 13.7 Temporarily idle assets The Clinical Commissioning Group had no temporarily idle assets as at 31st March 2014. 13.8 Cost or valuation of fully depreciated assets The Clinical Commissioning Group had no fully depreciated assets as at 31st March 2014. 118 Financial Statements: Notes 14 to 16 14 Intangible non‐current assets
The Clinical Commissioning Group had no intangible assets as at 31st March 2014. 14.1 Donated assets The Clinical Commissioning Group does not have any donated assets as at 31st March 2014. 14.2 Government granted assets The Clinical Commissioning Group does not have any government granted assets as at 31st March 2014. 14.3 Revaluation The Clinical Commissioning Group does not have any intangible asset revaluation as at 31st March 2014. 14.4 Compensation from third parties The Clinical Commissioning Group does not have any compensation from third parties as at 31st March 2014. 14.5 Write downs to recoverable amount The Clinical Commissioning Group does not have any assets which have been written down as at 31st March 2014. 14.6 Non‐capitalised assets The Clinical Commissioning Group does not have any non‐capitalised assets as at 31st March 2014. 14.7 Temporarily idle assets The Clinical Commissioning Group had no temporarily idle assets as at 31st March 2014. 14.8 Cost or valuation of fully amortised assets The Clinical Commissioning Group had no fully depreciated assets as at 31st March 2014. 15 Investment property The Clinical Commissioning Group had no investment property as at 31 March 2014. 16 Inventories The Clinical Commissioning Group had no inventories as at 31 March 2014.
119 Financial Statements: Notes 17 to 19 17 Trade and other receivables
Current 2013‐14 £000 NHS receivables: Revenue Non‐NHS receivables: Revenue Non‐NHS prepayments and accrued income VAT Total 1,172 406 67 10 1,655 Total current and non‐current 1,655 The great majority of trade is with NHS England. As NHS England is funded by Government to provide funding to Clinical Commissioning Groups to commission services, no credit scoring of them is considered necessary. 17.1 Receivables past their due date but not impaired 2013‐14 £000 By up to three months By three to six months By more than six months Total 154 6 ‐
160 £4017.14 of the amount above has subsequently been recovered post the statement of financial position date. The Clinical Commissioning Group did not hold any collateral against receivables outstanding at 31 March 2014. 17.2 Provision for impairment of receivables The Clinical Commissioning Group did not make any provision for impairment of receivables during 2013/14. 18 Other financial assets The Clinical Commissioning Group had no other financial assets as at 31st March 2014. 19 Other current assets The Clinical Commissioning Group had no other current assets as at 31 March 2014. 120 Financial Statements: Notes 20 to 21 20 Cash and cash equivalents Balance at 1 April 2013 Net change in year Balance at 31 March 2014 2013‐14 £000 ‐ 213 213 Made up of: Cash with the Government Banking Service Cash and cash equivalents as in statement of financial position 213 213 Balance at 31 March 2014 213 21 Non‐current assets held for sale The Clinical Commissioning Group had no non‐current assets held for sale as at 31st March 2014. 121 Financial Statements: Note 22 to 32 22 Analysis of impairments and reversals The Clinical Commissioning Group had no impairments or reversals of impairments recognised in expenditure during 2013/14. Current 2013‐14 £000 358 3,485 6,394 8,324 89 18,650
23 Trade and other payables NHS payables: revenue NHS accruals and deferred income Non‐NHS payables: revenue Non‐NHS accruals and deferred income Other payables Total Total payables (current and non‐current) 18,650
24 Other financial liabilities The Clinical Commissioning Group had no other financial liabilities as at 31st March 2014. 25 Other liabilities The Clinical Commissioning Group had no other liabilities as at 31st March 2014. 26 Borrowings The Clinical Commissioning Group had no borrowings as at 31st March 2014. 27 Private finance initiative, LIFT and other service concession arrangements The Clinical Commissioning Group had no PFI, LIFT or other service concession arrangements that were excluded from the SoFP as at 31st March 2014. 28 Finance lease obligations The Clinical Commissioning Group had no finance lease obligations as at 31st March 2014. 29 Finance lease receivables The Clinical Commissioning Group had no finance lease receivables as at 31st March 2014. 30 Provisions Under the Accounts Direction issued by NHS England on 12 February 2014, NHS England is responsible for accounting for liabilities relating to NHS Continuing Healthcare claims relating to periods of care before establishment of the clinical commissioning group. However, the legal liability remains with the clinical commissioning group. The total value of legacy NHS Continuing Healthcare provisions accounted for by NHS England on behalf of this clinical commissioning group at 31 March 2014 is £2,172k. 31 Contingencies The clinical commissioning group had no contingencies as at 31st March 2014. 32 Commitments 32.1 Capital commitments The clinical commissioning group had no capital commitments as at 31st March 2014. 32.2 Other financial commitments The clinical commissioning group had no none‐cancellable contracts (which were not leases, PFI contracts or other service concession arrangements) as at 31st March 2014. 122 Financial Statements: Note 33 33 Financial instruments 33.1 Financial risk management Financial reporting standard IFRS 7 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 the Clinical Commissioning Group is financed through parliamentary funding, it 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 the financial reporting standards mainly apply. The Clinical Commissioning Group has limited powers to borrow or invest surplus funds and financial assets and liabilities are generated by day‐to‐
day operational activities rather than being held to change the risks facing the Clinical Commissioning Group in undertaking its activities. Treasury management operations are carried out by the finance department, within parameters defined formally within the Clinical Commissioning Group’s standing financial instructions and policies agreed by the Governing Body. Treasury activity is subject to review by the Clinical Commissioning Group’s internal auditors. 33.1.1 Currency risk The Clinical Commissioning Group is principally a domestic organisation with all transactions, assets and liabilities being in the UK and sterling based. The Clinical Commissioning Group has no overseas operations. The Clinical Commissioning Group therefore has low exposure to currency rate fluctuations. 33.1.2 Interest rate risk The clinical commissioning group borrows from government for capital expenditure, subject to affordability as confirmed by NHS England. The borrowings are for 1 to 25 years, in line with the life of the associated assets, and interest is charged at the National Loans Fund rate, fixed for the life of the loan. The clinical commissioning group has no borrowings and therefore has no exposure to interest rate fluctuations. 33.1.3 Credit risk Because the majority of the Clinical Commissioning Group’s revenue comes from parliamentary funding, the Clinical Commissioning Group has low exposure to credit risk. The maximum exposures as at the end of the financial year are in receivables from customers, as disclosed in the trade and other receivables note. 33.1.4 Liquidity risk The Clinical Commissioning Group is required to operate within revenue and capital resource limits agreed with NHS England, which are financed from resources voted annually by Parliament. The Clinical Commissioning Group draws down cash to cover expenditure, from NHS England, as the need arises. The Clinical Commissioning Group is not, therefore, exposed to significant liquidity risks.
123 Financial Statements: Note 33 33 Financial instruments (continued)
33.2 Financial assets Loans and Receivables 2013‐14 £000 Receivables: ∙ NHS ∙ Non‐NHS Cash at bank and in hand Total at 31 March 2014 Total 2013‐14 £000 1,172 406 213 1,791 1,172 406 213 1,791 33.3 Financial liabilities Other 2013‐14 £000 Payables: ∙ NHS ∙ Non‐NHS Total at 31 March 2014 124 3,843 14,718 18,561 Total 2013‐14 £000 3,843 14,718 18,561 Financial Statements: Notes 34 to 37 34 Operating segments The Clinical Commissioning Group consider that they have only one segment: commissioning of healthcare services. 35 Pooled budgets The Clinical Commissioning Group had entered into a pooled budget with: • Middlesbrough Council • Redcar & Cleveland Borough Council • Stockton Council • Hartlepool Council • Hartlepool and Stockton Clinical Commissioning Group The pool is hosted by Middlesbrough Council. Under the arrangement, funds are pooled under Section 75 of the NHS Act 2006 for the loan of community equipment. The memorandum account for the pooled budget is: Income Expenditure Net Underspend 2013‐14 £000 719 514 205 36 NHS Lift investments The Clinical Commissioning Group had no NHS Lift investments as at 31st March 2014. The share in LIFT previously held by Middlesbrough Primary Care Trust was transferred to Community Health Partnership on the 1st April 2013. 37 Intra‐government and other balances Current Current Receivables Payables
2013‐14 £000 2013‐14 £000 Balances with: ∙ Other Central Government bodies ∙ Local Authorities 10 ‐ 194 2,244 Balances with NHS bodies: ∙ NHS bodies outside the Departmental Group ∙ NHS Trusts and Foundation Trusts Total of balances with NHS bodies: 914 293 258 3,550 1,172 3,843 ∙ Bodies external to Government 279 12,563 Total balances at 31 March 2014 1,655 18,650 125 126
Bentley Medical Practice Discovery Practice Endeavour Practice Huntcliff Surgery Manor House Surgery NHS Hartlepool & Stockton Clinical Commissioning Group Northern Doctors Urgent Care North Tees & Hartlepool NHS Foundation Trust Park Surgery South Tees Hospitals NHS Foundation Trust South Tees Hospitals NHS Foundation Trust Tees Esk & Wear Valley NHS Foundation Trust Village Medical Centre Dr A Tahmassebi Dr V Nanda Dr N Rowell Dr M Milner Dr J Walker Ms J Fruend Dr M Milner Dr V Nanda Dr A Tahmassebi Dr M Milner Dr N Rowell Mr S Gregory Dr H J Waters £000 98 88 44 71 52 1,018 1,048 2,683 43 211,798 211,798 43,800 46 £000 ‐
‐
‐
‐
‐
4,879 69 ‐
‐
‐
‐
‐
‐
2
‐
‐
‐
‐
180
‐
‐
‐
2,114
2,114
114
‐
£000 £000 ‐
‐
‐
‐
‐
82 ‐
75 ‐
‐
‐
‐
‐
Amounts due Payments to Receipts from Amounts owed from Related Related Party Related Party to Related Party
Party The Department of Health is regarded as a related party. During the year the Clinical Commissioning Group has had a significant number of material transactions with entities for which the Department is regarded as the parent Department. For example: • NHS England (including North England Commissioning Support Unit); • NHS Foundation Trusts; • NHS Trusts; • NHS Litigation Authority; • NHS Business Services Authority; and, • NHS Property Services. In addition, the Clinical Commissioning Group 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 Middlesbrough Council and Redcar & Cleveland Borough Council. Related Party Member Details of related party transactions with individuals are as follows: 38 Related party transactions Financial Statements: Note 38 Financial Statements: Notes 39 to 44 39 Events after the end of the reporting period
There are no post balance sheet events that will have a material effect on the financial statements of the Clinical Commissioning Group. 40 Losses and special payments
The Clinical Commissioning Group had no losses and special payments cases during 2013/14. 41 Third party assets The Clinical Commissioning Group had no third party assets as at 31st March 2014. 42 Financial performance targets
Clinical Commissioning Groups have a number of financial duties under the NHS Act 2006 (as amended). The Clinical Commissioning Group’s performance against those duties was as follows: NHS Act Section
2013‐14 2013‐14 Target Performance £000 £000 Duty Achieved Expenditure not to exceed income Capital resource use does not exceed the amount specified in Directions Revenue resource use does not exceed the amount specified in Directions Capital resource use on specified matter(s) does not exceed the amount specified in Directions Revenue resource use on specified matter(s) does not exceed the amount specified in Directions Revenue administration resource use does not exceed the amount specified in Directions 223H(1) 387,308 223I(2)
223I(3)
223J(1)
223J(2)
223J(3)
383,476
Yes ‐
‐
‐ 387,308 383,476
‐
‐
‐ ‐
‐
‐ 6,850 5,884
‐
Yes Yes 43 Impact of IFRS Accounting under IFRS had no impact on the results of the Clinical Commissioning Group during the 2013/14 financial year. 44 Analysis of charitable reserves
The Clinical Commissioning Group had no charitable reserves as at 31st March 2014. 127 Glossary NHS England Performance manages CCGs, Hosts Commissioning Support Units and directly commissions £20bn of Primary Care and Specialist services Performance This is how we measure and evaluate how well we are doing and how well the services we commission are doing. Waiting times, ambulance repose times and the number of healthcare acquired infections are also measures of performance. Planned Care This is care that is planned in advance. It is usually non‐urgent such as planned operations. Primary Care Primary care is many people's first point of contact with the NHS. Around 90% of patient interaction is with primary care services. In addition to GP practices, primary care covers dental practices, community pharmacies and high street optometrists. Provider An organisation providing services to the CCG through a contract. This could be a large hospital Trust or a smaller voluntary sector service. Urgent Care Care that is required quickly for conditions that cannot wait. This could be condition requiring an ambulance or a minor injury that must be treated quickly. Glossary Area Team Regional Team of NHS England. Our team spans Durham, Darlington and Tees. CCG Clinical Commissioning Groups are groups of GPs responsible for designing local health services in England. CCG’s do this by commissioning or buying health and care services including:  Elective hospital care  Enhanced Rehabilitation care  Urgent and emergency care  Most community health services  Mental health and learning disability services Commissioning Commissioning involves determining needs of the local population and ensuring services are planned and designed to meet health needs. It also involves ensuring services are effectively procured (bought) and then managed and monitored to ensure that they deliver what is required for patients and the local population, safely and effectively Foundation Trust NHS organisations that have more freedom from central government. They are accountable to their local communities their local communities through their members and governors and their commissioners (CCGs) through contracts. Lay Member Lay members are employed by the CCG although they are not involved in the day to day running of the organisations. They are members of the Governing Body and bring specific expertise and experience, as well as their knowledge as a member of the local community, to the work of the Governing Body. They are unable to be a Lay member if they are employed by organisations such as the NHS and local councils. 128 

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