The matter is important to those of us who live in the Greater Glasgow and Clyde NHS Board area and who represent constituencies there. Populations can change; they are usually declining and they leave behind—in crude terms—the old, the lame and the sick. That has not changed. Populations may change, but the disproportionate need of those people grows.
We have had evidence from both sides of the argument, including from senior board members, that although everyone accepts that there is no perfect funding mechanism, more work needs to be done to refine the system. If you have seen that evidence, what is your response to it?
That is a good point, convener. A key task for the integrated joint boards will be to provide foresight on workforce requirements. You are absolutely right to say that by no means all the workforce that provides care will come from health.
The one figure that I would put in front of the committee is that, in September 2009—I am deliberately taking it out of any political space by quoting figures that begin then—there were 9,579 allied health professionals, such as occupational therapists and all the others that we have mentioned, and in March 2014, there were 11,194. If I compare that with the changes in other staffing ratios in the health service, the most significant increase that I can see is in the allied health professionals. Similarly, the staffing in personal and social care has gone up from 763 in September 2009 to 909 in March 2014.
I am deliberately making a comparison within one Government’s term of office to show the trajectory on some of the relevant areas.
Convener, I will give an example that more directly answers your question about the quality and cost balance.
Each year, we support across Scotland what we call a framework for quality, efficiency and value. Through that, we try to spread best practice and support lower cost but better quality. For example, we are running across Scotland a little project called productive general practice for practice nurses in which we outline the benefits to practice teams of streamlining activity across the practice, eliminating waste and enabling practice nurses to add value and spend more time with patients. That is a practical example in productive general practice, in which we can see the achievement of a lower cost base and better quality outcomes. There are many such examples. The committee might want to see the annual report that gives a number of examples from all health boards in Scotland.
So basically you are taking active steps, such as not reducing lighting but putting in the better type of lamps that give the same light at a reduced energy cost.
That is helpful, but I am trying to link that to the budget scrutiny that is taking place. You are quite right to point out that you do not change staffing and skill mixes overnight, and that there is a wider picture. Health and social care integration is, I hope, developing apace. Across parties, there is a dramatic move away from ring fencing.
Would the funding of the staff mix by territorial health boards come under an NRAC formula? Would that be part of the normal uplift? NHS Greater Glasgow and Clyde got its 2.6 per cent—it gets a real-terms, above-inflation increase. It is not a dramatic amount, but it is still an increase. When that was done, was the staffing mix taken into account, or was it a case of health boards having to manage large budgets and redesign services themselves?
I suppose that I am trying to ask to what extent things are micromanaged from the top. To what extent is it up to health boards to get on with using the mandatory planning tools and designing the service accordingly?
I will turn again to Christine McLaughlin in a second. It is fair to say that senior members of most boards can advance compelling arguments about the local conditions that they face. I do not want in any way to underestimate or undervalue the multiple deprivation that is faced by communities that are served by Greater Glasgow and Clyde NHS Board. That is why we keep the formula under review.
I want to avoid—I do not think that it happens—NRAC funding turning into a competition among boards. I do not say that simply to make the point; the situation is as fair as we can make it at any given time and changes will inevitably introduce elements of perceived unfairness, which is why we try to keep the matter under review.
Would you like to hear more about that from Christine?
Yes but, of course, we have been reminded in previous committee meetings that we find it difficult to change the existing services. We add on services but do not necessarily tackle the others. It is an interesting area and we would happily engage with the Scottish Government on exploring it. There is no doubt about that.
That leads on to the other side of the argument. There are concerns about the shifts in nursing care and availability. There is a question of quality. Indeed, some of the savings that the special boards propose relate to reducing the number of people that they employ. How do we do that safely and, in the process, maintain quality and achieve the changes in the workforce that we need to achieve?
All the boards get a baseline uplift, which I think is 2.5 per cent. Greater Glasgow and Clyde NHS Board will get 2.6 per cent, which reflects its different circumstances. On top of that, Grampian NHS Board gets an additional uplift to bring it closer to parity. Greater Glasgow and Clyde NHS Board does not need to be given uplifts to bring it closer to parity, but it will get 2.6 per cent, as opposed to 2.5 per cent, in recognition of the prevailing circumstances.
All the boards will get at least a 2.5 per cent uplift. Greater Glasgow and Clyde NHS Board will get 2.6 per cent and, in addition, Grampian NHS Board will get more, because it needs to be brought to within 1 per cent of parity. We could give you a table.
Thank you for that. I entirely accept that the plans are about speech and language therapy, physiotherapy, community nurses, school nurses and all those groups as well. Is it possible for you to let us have the local delivery plans, which I know encompass those areas? Are they now available in the public domain? If not, when could the committee get hold of them to see what is planned for shifting the balance?
I will provide a bit of context. There are three components of funding in relation to what Aileen McLeod is talking about. The current financial year, 2014-15, is the final year of the reshaping care for older people change fund; the integrated care fund, to which Aileen McLeod referred, is for the year 2015-16. In addition to that, we are providing transitional funding for partnerships to support the implementation of integration, and we have just agreed on the allocation of £7 million to go out to partnerships.
We expect plans for the £100 million for partnerships to be developed in partnership between NHS boards, local authorities and the third sector, as the change fund has been. We will give partners further guidance on that so that they can develop their plans, but the funding is very much intended to be an enabler—to help partners to unlock some of the improvement that we are looking for.
Partnerships already have a good sense of what they think that the money could be used for, in preparation for integration, but in this financial year they are able to make good use of the change fund, so they do not have to wait until 2015-16. Our strong message to all partners is to get on with things now and to use this year’s change fund money to pump prime some of the work that we are looking for. There will be slightly different criteria for the 2015-16 fund on integrating care, but the key themes of working in partnership and keeping people out of hospital by having services in the community and the home setting will apply.
One difference between the change fund and the 2015-16 fund is that the latter fund applies to people who are under 65 and who have co-morbidities and complex needs. We will be looking for the fund to have an impact on that group.
Thank you.
Members have no further questions, but I have a final point. The committee is interested in preventative spend and how the Scottish Government is supporting health boards in estimating preventative savings. In response to a questionnaire on the issue of preventative spend, some boards said that it was not possible to provide us with information on financial savings; given those responses, it seemed that some boards did not understand the question of outputs and outcomes.
The evidence is there for you to see. I do not know how much work you do in that area and whether you need to do more to bring about a situation in which boards can identify what they are doing and what their preventative strategy will gain, and can understand the difference between outputs and outcomes.
Yes—I think that you need to do that.
All local delivery plans are available on board websites, so they are available now and have been for some months.
It might be useful to draw the committee’s attention to the guidance on producing plans that we sent out to boards this year, as it might help you to understand the context of how those plans were set. In the fullness of time, the committee will also need to be briefed on the health and wellbeing outcomes that we are currently consulting on as part of integration. The consultation is currently under way, but that is another important factor in shifting the balance of care.
How will that link in with strategic commissioning and the national health and wellbeing outcomes?
This line of questioning is relevant, not just to the committee’s scrutiny but to the future of the NHS. A couple of years ago Mr Connaghan presented department figures that clearly showed that there would be a reduction in nurses but a substantial increase in allied health professionals. I presume that that fitted with ideas about where we were going and the 2020 vision of treating more people at home.
We have a workforce planning tool that is focused on nursing, and there have been recent announcements about appointments to accident and emergency—I do not know whether those appointments were in the long-term planning. Mr Connaghan mentioned the need for a degree of triangulation between the money that is available, the service changes and plans and—what was the other one?
What we do not do is drop our quality standards. I have had a number of interesting conversations with, for example, the Scottish Ambulance Service about the changes that it has already made to the way in which it delivers services that provide a much higher level of care to people before they reach any hospital setting.
Part of what we do in that process is take advantage of new techniques and new technologies. We are also benefiting from, and spreading the implementation of, telehealth and telecare, which remove some of the need for home visits. I have seen that working effectively in NHS Ayrshire and Arran, which I pick only as an example.
Christine McLaughlin or John Connaghan might want to come in on the way in which we ensure quality in the delivery by special boards in particular, given the resource pressures that we face.
Yes, please.
That is a fair point, convener. We will certainly bring forward some of the lessons that we have learned from the change funds. One test will be when we get to the 2015-16 financial year and beyond, as we seek to be integrated by the end of that year. One of the tests, which will apply equally to health as it does to every other portfolio, is to get the sense that there is a real willingness to devote resource to making integration happen and to ensure that there is a sense of equity and parity.
I do not want to pass by your point about the third sector. One thing that I have consistently said to senior colleagues in the health service is that we must make it as easy as possible for the third sector to make a contribution and that we must not overbureaucratise our approach to engaging with it.
I have a few additional remarks that I can make on that and Christine McLaughlin can fill in some details.
I think that I am right in saying that NHS boards simply have their broad NRAC allocation, and they then need to determine how best to use it for their local population, taking into account the mix of what they have available at local level in terms of expenditure on fixed costs and resources versus variable costs, which involve the workforce. Obviously, not all boards are at the same place when it comes to their investment plans for using the bricks and mortar that they have available. There needs to be some degree of local flexibility.
In relation to workforce and workload tools, I should also have mentioned that a significant element of discretion is left to local practitioners, managers, clinicians and senior nurses as regards how they adjust what the workforce planning tool tells them for local circumstances. If they have a mix of patients who are more frail than the norm, they are able to adjust the workforce tool to provide for additional staff to cope with the requirement for flexibility.
You make a very fair point, but I do not think that there will ever be a line in any health board budget that clearly encapsulates preventative spend and shows a percentage. The difficulty is that quite a lot of what we do is preventative spend. For example, statin therapy is part of the management strategy for the primary prevention of cardiovascular disease for adults. An economic model that was developed by the Department of Health in England estimated that vascular checks every four or five years for all those aged 40 to 70 was cost effective.
I mention those two examples to show that preventative activities are undertaken as part of a regular visit to a GP surgery. Preventative activities are also undertaken by NHS 24; when people phone up, they get advice and do something that prevents them from having to go to hospital. We are also doing preventative activities around exercise and wellbeing. Encapsulating all that in budget lines is virtually impossible. However, you referred to outcomes, which I think is the place for us to look.
To put it simply, I am keen that we do more on understanding the value for money of intervention so that, if we are in an age of resource constraints—as everyone in the public and private sector is—we can ensure that our interventions are the ones that are most likely to deliver positive outcomes for people and communities. Part of that is about involving people and communities in discussions about what would work for them.
A top-down imposition of solutions is not always effective, so part of our programme for the integration of health and social care is to ensure that the conversations that happen in localities are meaningful to the people concerned. I am quite certain that what will work in the convener’s constituency might not work in one or two of the constituencies that committee members represent. That is why it is important that we take our preventative spend agenda right into communities and ask what is most likely to work for them, given the resource and options that we have.
All that is a long way of saying that it is the focus on outcomes that will actually start to bite. Trying to strip out budget lines will probably not work.
The planning assumption in 2014-15 is that we are putting £47.5 million into bringing boards closer to NRAC parity. We have planning assumptions on additional funding over the next three years, as part of the budget-setting process, to put aside money to bring boards closer to parity. The trajectory based on the current figures for NHS Grampian shows that the money that we are putting in over the next three years will bring it to within 1 per cent. That involves a planning assumption for that period.
NRAC is about relative shares. We do not take money from boards that are funded above parity, but additional money goes into boards that are below parity. All territorial boards are receiving a real-terms increase for 2014-15. The plan is for that to continue in future years, including 2015-16. Boards such as NHS Greater Glasgow and Clyde would still receive a real-terms increase in their funding, but they would not get the additional top-up on NRAC funding. That is how we manage the relative shares so that no board is below 1 per cent below parity.
We hold boards to account through their health improvement, efficiency, access and treatment—or HEAT—targets. I will bring in colleagues in a second, but without wanting to deflect the question, I point out that I would not hold an individual health board to account with regard to health inequalities, because I believe that the issue stretches across the range of public and voluntary services that are commissioned in any area.
For example, through the early years collaborative, we are trying to recognise that the only way of tackling persistent health inequalities and, indeed, persistent inequalities in general is to have cross-sector working that delivers locally. With something like the childsmile programme, we are attempting to tackle long-standing, persistent and deep-rooted inequalities, and we are very alert to the risk of population shift to which the convener referred, as it could result in inequalities increasing, not decreasing.
I know that Linda de Caestecker, the director of public health in NHS Greater Glasgow and Clyde, takes the whole agenda very seriously. John Connaghan will be more specific about health inequalities.
Yes. The new hospital in Glasgow is being designed in line with the latest energy efficiency standards. When we open or develop new premises, we ensure that they conform to those standards. We can give more detail from individual boards, as John Connaghan has said, but the overall reduction has, as Christine McLaughlin has said, saved us £9 million and has reduced carbon emissions.
Agenda item 4 is our continuing scrutiny of national health service board budgets. Today, we are hearing from the Scottish Government. We welcome Paul Gray, who is the director general of health and social care and chief executive of NHS Scotland; Christine McLaughlin, who is deputy director of finance health and wellbeing in the Scottish Government; and John Connaghan, who is the Scottish Government’s director for health workforce and performance.
I believe that you wish to make an opening statement, Mr Gray.
In 2014-15, Greater Glasgow and Clyde NHS Board is receiving a 2.6 per cent uplift, so there will be no funding reduction. Glasgow receives a higher amount of funding than the formula would suggest, based on current assumptions.
The review of acute morbidity in life circumstances to which I referred started in February. Glasgow is heavily involved in that and has a number of health economists and other public health representatives on the group to look at whether anything else should be done to change the formula.
Every board, Glasgow included, will have our best estimates of the likely NRAC funding over the next three to five years, so that they have some financial planning certainty over that period. If something changes, we would accept the group’s recommendations and make amendments to the formula.
I will make it as simple as I can. In 2014-15 Greater Glasgow and Clyde NHS Board will get an uplift of 2.6 per cent and Grampian NHS Board will get an uplift of 4.6 per cent. All boards will get an uplift, but there are different levels.
Partners are starting to work on draft strategic plans, so they are able to consider how to use the change fund in 2014-15 and the integrated care fund in 2015-16 as enablers, to deliver their ambitions. The work starts now, and a number of partnerships already have draft strategic plans. They will consider how to use the non-recurring funds to kick-start some of their initiatives.
I welcome that. We have substantially reduced energy costs in this building. I welcome the good news that you have reduced your energy consumption, too.
The workforce that is required.
Some of the evidence that the committee heard from people such as Simon Belfer from NHS National Services Scotland was about the focus within its efficiencies on, for example, rationalising its estate. In some ways, it is perhaps an exemplar of how to go about such a review. It has considered what it could make more efficient in the way in which it provides services and its overall infrastructure. It has been able to make its staff savings within its existing turnover levels. There has been a very successful programme of redeployment and retraining for staff in quite specialised areas.
NSS has been able to do all that within the context of being one of the four special health boards that returned funding of £144 million over four years and within existing policies of no compulsory redundancies. We would like some of the examples that NSS gave the committee to be spread more across the boards. Special health boards have had a different set of circumstances and a different uplift and we have set them some quite challenging savings targets while looking for them to generate savings within the territorial health boards as well. The story from the special health boards is quite positive.
We might overuse the term “preventative”, but we all seem to use it.
Thank you for your attendance, which we appreciate. We look forward to using the information that you have offered during this evidence session to complete our report. The committee will be happy to play a role in addressing some of the challenging issues that we face.
12:15 Meeting continued in private until 12:28.
That is helpful. Thank you.
It is very much at the discretion of the boards. Their baseline funding, which is the majority of funding for territorial health boards, will comprise the nursing costs. It is for the boards to consider their service redesign, their efficiency savings plan and how they manage all that, taking into account how they achieve change. Their turnover levels would form part of that.
We do not micromanage that process, although we do consider how boards compare, what they are doing and their relative percentages. We would always seek to understand why there are differences across boards. It is for the boards, however, to decide how to use their baseline funding in the provision of services for their populations.
How can the NRAC formula guarantee that the allocated resources reflect the true needs of an area, and that they are not based just on proportion of the population and age groups, which I think has previously been the case?
Can you update us on what is going on between COSLA, the NHS and the department? At one stage we had evidence that the budget was being top-sliced and handed over. We know that there has been constructive discussion about who is funding what and whether funds can and will transfer. You have referred to on-going discussions. What stage are those discussions at?
I can give more information on how that is done, if you want more detail. In general terms, the formula takes account of population, and it takes into consideration morbidity and life circumstances. There is an adjustment within the formula in relation to the number of hospital admissions in an area and the average length of stay. There is also a mechanism within the formula for understanding relative need and the cost of that need within each population.
There is a group that represents boards and which has health economists on it, which always tries to refine the formula as it goes. Work is currently being done on acute morbidity and life circumstances over a two-year period. The group is considering whether all the relevant factors are being taken into account.
That is good to hear. Given the efficiency savings target that Greater Glasgow and Clyde NHS Board is expected to meet, and that it will not receive its current share of NRAC funding—I am not sure whether that is a reduced or a zero share—what is the comparison between the amount of money allocated now and how much that money will reduce by over the coming year, if you play in the efficiency savings?
Rhoda Grant wants to come in on NRAC and funding.
I will make a brief comment, rather than asking another question. Hindsight is a wonderful thing. We are trying to establish how best to carry out board budget scrutiny. Perhaps there are more detailed questions that we should have been asking of boards. In particular, we might have asked where they see their nursing staff numbers in three years’ time, what their budget assumptions around that are for this year and how they can move towards them while identifying other pressures.
Those are not necessarily questions for you, but we are trying to find a meaningful way of developing budget scrutiny around something as significant as nursing numbers and the workload.
The workforce. I do not know whether that is a triangle or a see-saw, given the political pressure under which we are all working.
Bob Doris was right to say that workforce planning is essential. Are you confident that we are planning the workforce of the future? We currently do that by measuring the number of consultants, nurses, hospitals, procedures in hospitals and so on, but we need to move away from an approach that does not enable us to focus on how the new workforce will look.
I thank the committee for this opportunity to discuss the budgets. We start from a strong base in NHS Scotland budgets; we plan for the long term and the short term, and we have clear financial planning assumptions. Our base is built on the fact that boards have delivered services within financial plans for the past six years, and they continue to deliver efficiency savings at or above the targets that have been set.
I assure the committee that budgets are not developed in isolation; they form part of boards’ planning for service delivery and workforce. Our methods of funding are designed to provide equity as well as stability, and to incentivise the right behaviours around efficiency and planning.
Boards’ plans for 2014-15 will deliver a balanced position. We recognise, however, that it is becoming increasingly challenging to do so, and that will continue. That is why we have such a strong focus on improvement and efficiency, and it is why we are proceeding with the very important work on integration of health and social care.
If there is information that the committee wishes to know that we do not have immediately to hand, I undertake, as I always do, to provide it as quickly as possible.
I will make good use of the colleagues who are with me, and who have expertise in particular areas in which the committee may have an interest.
I have a supplementary question about the share of the budget that general practice gets. It may be more of an accounting question, but it relates to two things that are going on now.
First, link workers are based in the deep-end practices in Glasgow. There is a cash cost to that, but it alleviates pressures on GPs in those deep-end practices, because those link workers are dealing with matters that a GP would otherwise deal with. I am not sure whether that shows up in the GP’s budget or in another budget, but it is an example of a spend that contributes towards general practice. I am not sure how that is accounted for.
Another example is prescription for excellence. One of the first workstreams relates to medications reviews and health boards paying money to different areas. I understand that work has already been done on that in Glasgow and that some of that money will go into health centres and into work in general practices, with pharmacists going in and doing medications reviews. Again, it is not money that is being paid to GPs, but it relieves pressures and burdens on GPs. Does that money go towards share of spend in general practice?
I am not sure that we are capturing all the public spend in general practice appropriately, so it might be a false share that we are looking at. Maybe you could write to us about this, but where do those things sit on the budget line?
That is helpful. Maybe plans could be shared with the committee, so that we can see how the integrated care fund sits with everything else around health and social care.
The discussions are continuing. I understand that the Cabinet Secretary for Health and Wellbeing and Peter Johnston are about to issue a letter of guidance to the health board chief executives about the policy expectations, so I do not want to pre-empt that. My understanding is that that letter should go out shortly, and I would want to ensure that it is shared with the committee immediately. I do not know whether Christine McLaughlin wants to say any more about the discussions with COSLA at this stage.
I will start by seeking clarification. You say that all the boards will get an uplift in real terms; they will get an increase in real terms. Is that calculation based on basic inflation or on health inflation?
We did a fairly large piece of work recently on best practice in strategic-level planning for the workforce. The work was about a year and a half in preparation. It might be useful if we gave the committee sight of the guidance that we are issuing to boards in that regard.
Thank you for those short opening remarks. We will go directly to questions.
Boards that are above parity do not receive additional NRAC funding, but they receive their uplift. In 2014-15, the uplift for Glasgow will be 2.6 per cent. The efficiency savings that Glasgow generates are all retained locally. There is no baseline cut; its baseline, along with that of every other board, has been increased. Therefore, the question is about the value of efficiency savings that the board must generate in order to maintain and redesign its services and to deal with cost pressures. All those funds are retained within NHS Greater Glasgow and Clyde for reinvestment.
We would certainly be happy to do that, to ensure that the funds provided are properly represented.
As you have mentioned the deep-end practices, I want to take the opportunity to say that I have had some conversations about what they are doing and I think that it is a valuable piece of work that sits well with the approach that we are trying to take to tackling persistent inequalities. They are a good example of work in progress.
One thing that has been quite consistent is that there will be an identification of resources in relation to the total spend on adult social care. That needs to cover hospital care in the community, social care and the part of acute care that relates to that population. Partners are working on how they can use the integrated resource framework to identify all of that resource. We have had discussions about that with the directors of finance of some territorial boards. The integrated resource framework allows partners to identify the resources through the whole pathway. The costs will be calculated on that basis, so that they are transparent for the partnerships going forward.
The committee will want to bear it in mind that NHS Education for Scotland looks ahead to demand for training places for nurses and doctors and so on. There is a long-term planning horizon to ensure that, as far as possible, we have the right number of people available to come into the system in years to come.
The committee is right to recognise that it is a complex environment. We certainly do not attempt to reach down from the centre to try and define dispositions at hospital and ward level.
12:00
I return to the two board areas that I mentioned. The NHS Grampian area clearly does not have the extent of deprivation that NHS Greater Glasgow and Clyde has to deal with, but we do have a particularly rapidly ageing population in Aberdeenshire. There are also hidden pockets of deprivation that perhaps do not always come to light. There is a real concern there. It is about getting a bit more parity so that we can achieve what is best for the population as a whole.
The committee accepts the principle that integration and collaboration are not simply the responsibility of health, although health has a big part to play. We will want to know what lessons have been learned from how the change fund has been spent and whether we can be confident that the third and voluntary sector is engaged. The sector has complained bitterly to us that it does not have the sign-off that it should have and that it feels like the poor relation at the wedding. Those are important issues.
Health is contributing £100 million to integration. What are others bringing to the party? Integration will involve many issues that relate to the education budget, the justice budget and the social work budget. What will the pot look like? Will initiatives on integration and collaboration get the maximum buy-in from others?
11:45
It will probably come as no surprise to people in the Government that, as a member for North East Scotland, I have a particular concern about the NHS Scotland resource allocation committee—NRAC—formula. At this point, NHS Grampian is £34.7 million below parity, while NHS Greater Glasgow and Clyde is above parity by more than that. I know that there is an aim to make things more equal over the next three years or so, but I would be interested to know how the Scottish Government expects to find the resources to bridge that gap. Given the financial pressures on health boards and alignment towards parity, how can NHS Greater Glasgow and Clyde be expected to undergo a reduction to get towards parity, and how can NHS Grampian expect to have an increase towards parity?
My basic point is that the disproportionate need will not change over the three or four-year period. Will Greater Glasgow and Clyde NHS Board have more or less money to work with to meet that need over that period?
I return to the HEAT targets, but not in the way that you might think. I previously served on the Rural Affairs, Climate Change and Environment Committee, which is interested in asking other committees to look at the contribution made in their respective areas to the reduction of climate change. The Scottish Government has an excellent programme, but in some ways we have not met its aims.
What is the health department doing to reduce energy consumption? Given that the budget as a whole is £12 billion to £13 billion, what is the current energy cost across all the boards within that budget? I am sure that you will have a figure that you can give me straight away. In any hospital, the main costs are for staff and so on, but energy costs are also tremendous. Most lights are on 365 days a year. What are we doing to reduce energy costs in the NHS?
We would welcome that.
The uplift is based on the gross domestic product deflator, which is at the core of the definition of “real terms” for local government.
Thank you.
As Christine McLaughlin has explained, we seek to keep a close watch on the formula. Populations change; we want to be sure that we reflect population mobility. No funding formula will be perfect. It cannot change weekly or monthly; it changes slowly over time to reflect changes in population and other factors. We are considering the impact of providing remote and rural services through the addition of an element that would reflect variations in the cost of providing out-of-hours general practitioner services across urban and rural geographies, and which better reflects the higher costs of providing services in the islands.
We try to keep the formula under close review and to ensure that changes in circumstances are reflected. However, given the allocation process that we have, there will never be a perfect fit for every circumstance.
If you were to base the figure on health inflation, what would that mean in real terms?
Mr Connaghan will comment on that, and Christine McLaughlin will follow up.
Christine McLaughlin will say a little more about the detail. One of the reasons why we have set a trajectory to bring boards close to parity within the next few years is to give them foresight of what we plan to do, so that we do not introduce a series of shocks into the system.
We recognise the pressures that are faced by boards. We seek to support them through a number of measures, including interventions that John Connaghan and his team lead, to ensure that boards that face short-term pressures are supported. Christine McLaughlin will give you a slightly more detailed account of our approach to moving towards NRAC parity.
11:15
In baseline terms, the board will have more, not less, money.
I call Aileen McLeod—and I thank her for her patience.
It is a good piece of work, and it helps boards to look ahead five or 10 years. It brings together all the evidence that we have collected over the past year and a half about what really happens.
We should not set out a stall that says that the only way forward is to have more staff in a particular area. Staff mix, skill mix and services change. For example, the introduction of one-stop clinics in Scotland over the past 10 years has reduced the requirement to have half a dozen clinics that are staffed by half a dozen sets of administrative staff. It is a better deal for patients, but we have tended to put the associated savings into clinical staff.
That is why when I scan down the NHS workforce I can see significant changes in staff groups. All that happens against a plan that says, “This is how we will do it”, which is refreshed annually by boards. I am happy to give you something on that.
I do not have such a comparator just now.
We will need to reflect on your question about the amount of money that is spent on energy and what we are doing to reduce the figure. I am afraid that I do not have the figures to hand, but we can send them to you.
You mentioned HEAT targets. We have HEAT targets to reduce energy-based carbon dioxide emissions and to continue the reduction in energy consumption to contribute to meeting the greenhouse gas emissions reduction targets that have been set in the Climate Change (Scotland) Act 2009. There are specific targets for the boards to chase. In our written submission to the committee, we can give you an update on where boards are on delivering on the targets.
In simple terms, if the board has £100 now, will it have £100 in four years? Will the amount be less or more?
I want to go back to the health and social care integration agenda. Health boards and local authorities will be required to put in place the local integrated arrangements by April next year, with full integration of services by April the following year. The key will obviously be how we implement that on the ground. I know that the Scottish Government has made available an additional resource of £100 million for the integrated care fund, but I would like to ask Mr Gray for more detail about the criteria that will be used to determine the allocation and distribution of that fund and how it will be implemented to ensure that there is real and genuine partnership and collaborative approaches between the key stakeholders.
I shall ask Christine McLaughlin to comment on that in a second, but first I would like to say that, for me, the key criterion on the integration fund is that it is used to fund projects or implementations that make a real difference to the way in which we deliver services for the benefit of people. There will be many more criteria, but for my part the focus of the integration of health and social care is to ensure that we provide, within available resources, the best possible services to individuals and that our approach to delivering services is focused on need rather than on a provider-centric approach. A key element of what I want to be delivered through the integration fund is that focus on individuals and communities.
Christine McLaughlin can give more detail.
I add that the “Annual State of NHSScotland Assets and Facilities Report for 2013” identified that energy consumption has reduced by 9.7 per cent and that boards are continuing to reduce energy consumption. The report estimates that the cost would have been about £9 million higher if that reduction in consumption had not taken place in the last 12 months.
It will be more, because there is an annual uplift.
I guess that your point is about what the boards need to do with that money.
Could we get that information in writing? It would be useful.
Yes—although I do not think that we have such a definition. I can give you the cost pressures and the inflation that boards identify as a cost within that, but I do not have the equivalent of the GDP deflator for health.
Yes.
There used to be a figure for health inflation.
In absolute terms, they will have more rather than less money.
In absolute terms they will have more, but the money will not increase proportionally with inflation.
I can give you the figures that boards quote as the inflationary factor for different pressures such as pay and prescribing, if that would help.
There will be a real-terms 2.6 per cent uplift to the baseline. There is no cut to Glasgow’s funding.
That would be helpful.
I can give the committee something in writing on that. I can also give it the table on the percentage uplifts for each board, so that members can understand the differences between boards.
I am just trying to figure out the position. In your opening remarks, you said that Greater Glasgow and Clyde NHS Board would not get additional NRAC funding.
Greater Glasgow and Clyde NHS Board will not get the additional uplift that, for example, NHS Grampian will get.
The second issue on which I seek clarification is whether the NRAC formula is a blunt instrument. Is it responsive enough to changing circumstances? Highland NHS Board, for example, has been trying to cut budgets for so long, but it is now suddenly underfunded. Change seems to be happening, but the formula does not reflect it quickly enough.
How can it get the same money if it does not get the additional uplift?
As I said, the NRAC formula is the best instrument that we have at the moment, but it does not, for example, enable us to make significant in-year changes to reflect changing circumstances. However, were we to do so there would be great uncertainty about what health boards’ budgets would be. We must balance carefully the need to take into account the factors that affect the formula with the need to give boards current and future certainty. I would describe NRAC as an imperfect instrument, but it is the best one that we have. It replaced the Arbuthnott formula—a lot of work went into producing NRAC and into making it more flexible and responsive. It is certainly a flexible and responsive instrument, but I do not think that any such instrument in the world could be claimed to be perfect, and I would not make such a claim.
We have been at this for a long time. In 1976 the then principal of Heriot-Watt University, Robin Smith, produced the initial share system to try to redistribute funds, but we have never quite got to a situation in which there is parity.
I have two brief questions. First, given that under NRAC, which is a blunt instrument, Greater Glasgow and Clyde NHS Board has received funding that is greater than its share, what do you do to hold the board to account for the fact that health inequalities have not improved at all in Glasgow? For NRAC, the two big factors are age and deprivation, and rurality is also a factor. However, given that deprivation is one of the main features of the distribution formula, the boards that get a greater share of the distribution should apply the funds to tackling health inequalities. How do you hold the board to account for that?
11:30
We would appreciate that, because I cannot see how the 2020 focus on treating patients closer to home fits with the thinking and planning for hospital-based clinicians.
Of course, planning the workforce is not just an issue for health—that takes me back to the point that I made earlier. We need to plan for not just the clinical workforce but the social workers, support workers and carers who we will need in the community. Aileen McLeod mentioned commissioning services; we need to know where the workforce will come from. That is pretty important.
I suppose that I should declare an interest, as Dr Simpson did. I am afraid that I do not have any particular qualifications, as Dr Simpson does, but I will ask about workforce planning tools in relation to nursing. My wife is a nurse—I suppose that I should put that on the record—and I tell her on a daily basis how wonderful the NHS is, then she tells me what happens on her ward on a daily basis. Sometimes, the truth lies in the middle somewhere.
A lot of progress has been made on workforce planning tools, in conjunction with the Royal College of Nursing and other stakeholders, to nail down, in certain circumstances, the size and shape of the workforce and the workload that is expected of nurses.
I would be interested to know a little bit more about how that relates to future budget settlements. Workforce is the largest part of the NHS budget and head counts are a very politicised affair. It would be helpful to have some more information about how workforce and workload management tools feed into budget settlements. I am referring not just to the current year that we are scrutinising, but to future years. Where would you signpost us if we are to scrutinise future budgets in that regard?
I also wish to ask what the Scottish Government’s plans are. Could you develop that a bit further? Allied health professionals will have an additional significant role, particularly with health and social care integration. There will be a lot of change in the workforce as it becomes a lot more community based. It is not a matter of simply saying, “Isn’t it good that we have a workforce planning tool?” That is a good thing, but by its very nature that tool will have to develop and change radically in the years ahead. How will that be managed? How will the financial underpinning of that be fed into NHS budgets?
I will bring in both John Connaghan and Christine McLaughlin on that, but first I will mention that, this year, the use of those tools is now mandated. In the past, it was optional. We believed that it was right to move to making them mandatory. We have already seen some improvements in the way in which boards have been able to assign the resources that are available to them.
I think that it was in 2008-09 that we introduced the first workforce and workload planning tools, particularly for nursing in the NHS in Scotland. In 2010-11, the national RCN held up Scotland as an example of good practice in this area and commended that approach to the rest of the UK. You are right to say that Scotland did a little bit of path breaking on the issue.
The tools have developed over the past three or four years. Our director general has intimated that we have now made them mandatory, because we think that they work and that they produce good results. As for how they relate to budgets, we expect each board to produce an annual workforce plan, and we have guidance on that in chief executive’s letter or CEL 32 (2011). Each health board is required to produce an annual workforce plan and projection, and to relate the plan to two other things: budgets and service changes.
Workforce planning cannot take place in isolation. It needs to have some degree of triangulation with the resource that is available and some degree of triangulation with service changes and plans. All those are subject to the annual planning process. Furthermore, boards are requested to look further ahead, such that they have some forecast of workforce planning requirements. All that is refreshed annually.
You mentioned the development of tools. Most of the tools that are currently in practice are used for nursing, and we are considering how we can expand their use. We have opened some discussions around expanding the use of the workload planning tool into accident and emergency departments. That will cover not just nursing but also doctors and allied health professionals. That is at a relatively early stage, however. In the fullness of time, when we are a bit further down the track, we can return to the committee to inform you about how we are developing that into other areas.
Perhaps I can amplify some of Mr Gray’s comments about HEAT targets.
Over the years, we have given boards a number of targets to pursue, including increases in dental registrations, reductions in suicide rates, delivery of smoking cessation targets, drug and alcohol waiting times and child and adolescent mental health services, reductions in infection rates and so on. Because some of those are clearly related to deprivation and inequalities, we will want a relatively better performance from boards that are below the norm in some of those areas.
When we track HEAT performance over the years, we see that boards set individual trajectories that are part of the local delivery plan that is signed off annually. That is one of the ways in which we can hold boards to account for relative differences in performance.
Paul Gray has already alluded to the other issue that I wanted to raise, which was about shifting the balance of care.
In various reports, Audit Scotland has made it very clear that there is not a great deal of evidence that the balance of care is being shifted. General practitioners—I should at this point declare an interest as a fellow of the Royal College of General Practitioners and a member of the British Medical Association—are increasingly campaigning against and clamouring about the massive pressure that they are under. Indeed, my mailbag is filling up with correspondence from GPs about the fact that they are under such pressure at a time when their share of the budget has gone down rather than up. I admit that there has been a rising tide in the overall budget, but their tide has been rising less than others’ tides.
My question about NRAC, therefore, is: how do you hold health boards to account for shifting the balance of care?
Again, I will ask colleagues to say a bit about local delivery plans and the trajectory and expectations that we are setting health boards for their funding of primary care in general.
I am very clear that primary care can play a fundamental role in the integration of health and social care, and I expect that, when the integrated joint boards are fully established and the functions are fully up and running, that will in time help us make the shift towards out-of-hospital care. We have said that our vision for the health service is that by 2020 more people will lead longer, healthier lives at home or in a homely setting, and I think that that vision speaks for itself.
I should say that I am using the broader term of “primary care” deliberately. GPs make an enormous contribution, but the contribution of the wider primary care family is also very valuable. I am quite happy to tell this committee that I regard the utilisation of primary care as a key component in the successful delivery of the integration of health and social care.
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