Annex A > Chapter 6 - Funding and Resources > UBHT's funding after 1991 > The delegation of budgetary control after 1991

The delegation of budgetary control after 1991

56 The UBHT drew up its own Standing Financial Instructions (SFI). [84] Mr Nix stated in his written evidence to the Inquiry that overall responsibility for finance lay with the Chief Executive and the Trust Board. Clinical directors were accountable to the Chief Executive for the directorates' performance, including financial performance. In this regard, they had the assistance of general managers. [85]

57 Paediatric cardiac surgical services were delivered through two different directorates. Paediatric cardiac surgery formed part of the Surgical Directorate, with Mr Roger Baird as the Clinical Director. Mr Wisheart was Associate Clinical Director of Cardiac Surgery; Mr Dhasmana later succeeded him. [86] Paediatric cardiology was separately managed, as it formed part of the Children's Services Directorate. [87]

58 From 1 April 1995 cardiac surgery was removed from the Directorate of Surgery by the creation of a Directorate of Cardiac Services. This included the disciplines of both surgery and adult cardiology. [88] In October 1995 paediatric cardiac surgery and paediatric cardiology were brought together within the Children's Services Directorate, when paediatric cardiac surgery was relocated to the Children's Hospital.

59 Mr Nix explained that the aim of appointing associate directors was not only to ensure that clinicians were involved in the management of the services they provided, but also to place the responsibility for achieving the patient service contracts and the financial targets on those who were delivering the service. [89]

60 He explained further that:

`Budgetary control was delegated to the Associate Directorates and then within them to the wards, theatres, perfusionists, cardiology, etc. All budgets were reviewed annually and mainly rolled forward at the same level as for previous years, with an increase for inflation and for any developments agreed with purchaser Health Authorities or GP fundholders'. [90]

61 The report of the Director of Finance dated March 1992 set out rules for virement [91] and budget guidelines for clinical directors. [92] The arrangements gave complete discretion to the clinical directors to transfer between revenue budget headings during the year, to use funds for minor capital schemes, and to carry forward underspending. [93]

62 When implementing any budget changes during the financial year, clinical directors and their managers were required to take account of the advice of their financial manager and those other officers who possessed a relevant professional interest. [94]

63 Any proposal to reduce the level of service to patients had first to be approved by the Chief Executive.

64 As with the District Health Authority, senior finance staff acted as financial managers in respect of each directorate. They were responsible for providing advice on financial management to directorates. This included establishing principles for the compilation of annual budgets, regularly advising on budgetary performance and service agreements, ensuring the proper appraisal of all proposals for changes in service, and encouraging the search for efficiencies, cost improvements and initiatives for income generation. [95]

65 Within the UBHT, financial management was on three levels:

• senior financial managers, providing strategic financial advice to clinical directors;
• a qualified accountant, working with the clinical director and general manager on a day to day basis;
• a team at operational level, supporting the budget managers.

66 Mr Nix explained that budget managers received monthly expenditure reports, with detailed transaction reports and summaries provided at directorate level for the Trust. The expenditure reports included an analysis of income against planned expenditure and data on actual workload against the plan as analysed by the purchaser. The purpose in supplying the data to the directorates was to assist them in meeting the targets set by the purchasers and the financial targets set by the Trust. [96]

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Footnotes

[84] UBHT 0023 0297; UBHT Standing Financial Instructions

[85] WIT 0106 0182 Mr Nix. Further details of the directorate structure and of hospital management structures, are to be found in Chapter 8

[86] UBHT 0338 0114; UBHT Budget

[87] UBHT 0338 0044; UBHT Budget

[88] WIT 0106 0023 Mr Nix

[89] WIT 0106 0023 Mr Nix

[90] WIT 0106 0034 - 0035 Mr Nix

[91] This is the ability to move money between designated budgets or budget sub-heads, e.g. to be able to spend money designated for capital expenditure on revenue costs

[92] UBHT 0338 0027; Report of the Director of Finance 1992/93

[93] UBHT 0338 0027; Report of the Director of Finance 1992/93

[94] UBHT 0338 0034; Budget 1992/93: `Budget Flexibility and Guidelines for all Budget Managers'

[95] UBHT 0338 0033; Budget Management

[96] WIT 0106 0036 Mr Nix