Priority 4: Managing our resources effectively

In a climate of increasing need for services and continuing pressures on budgets, it is vital that we make best use of available resources.

Financial management and performance

Financial information is a key element of our governance framework. Each year we produce a financial plan which sets out how we ensure our limited resources are targeted to support delivery of our strategic plan. Our financial plan for 2021/22 was agreed by the board in March 2021.

Regular updates on financial performance against this plan were provided to the Performance and Delivery Committee as well as to the EIJB itself. Included in these reports were details of the financial impact of the pandemic and progress with the savings and recovery programme.

Budget monitoring of delegated functions is carried out by the finance teams in the City of Edinburgh Council and NHS Lothian, reflecting the EIJB’s role as a strategic planning body which does not directly deliver services, employ staff or hold cash.  However, the board needs oversight of the in-year budget position as this highlights any issues that need to be accounted for when planning the future delivery of health and social care services.

You will find a comparison of costs against the budget for the year summarised in the table below:

Whilst there is no doubt that we will continue to face significant financial pressures, we saw our previous improvements in financial planning and performance sustained during 2021/22 as we delivered a surplus of £3m against the budget for the year.  These funds have been transferred to our reserves and will be carried forward to 2022/23 for prioritisation by the board. Interpreting the financial results during a pandemic is not straightforward but it is evident from the table above that we continue to experience pressure in our purchasing budget. In the main this can be attributed to spot purchasing, predominantly care at home/care and support, residential services and direct payments.

The pandemic clearly had an impact on our finances, and this was closely monitored during the year. We incurred net additional costs of £42m as a direct result of COVID-19. The main categories of associated expenditure being: sustainability payments made to support providers during the pandemic; purchase of additional capacity; additional staffing and reimbursement of independent contractors; increased prescribing costs; delivery of the vaccination programmes and slippage in the delivery of the savings and recovery programme. In line with their commitment, these costs were met in full by the Scottish Government and are summarised below:

The chart below shows costs in key areas for the last four financial years:

Bar chart of costs for last four financial years across various services

Although many of the delegated services are delivered directly in localities, a significant proportion are run on a city-wide basis. Showing how the associated costs are incurred within each locality requires a degree of estimation and assumption. This exercise shows that the cost of services is relatively consistent across the four localities, as shown in the diagram below.

Pie chart showing split 23% South West, 26% North East, 24% South East, 27% North West

Bed-Based Review

The bed-based review is continuing to redesign bed-based services across the city, taking into consideration demand and capacity to ensure provision of sustainable services. The project covers a range of bed-based services including medically led beds in hospital settings, and beds located in the community led by social care staff.

A phased approach has been adopted to the project activities, with the implementation of Phase 1 under way. Work is progressing to implement the agreed Phase 1 changes, which will see an increase in intermediate care capacity, a streamlined Hospital Based Complex Clinical Care (HBCCC) service, and the introduction of nursing staff into our internally managed Care Homes. These changes will enable us to leave the Liberton Hospital site, freeing it up for redevelopment.  Work is also ongoing in specialist inpatient rehabilitation and palliative / end of life care.

In September 2021 the EIJB agreed to undertake a consultation on the future provision of older people’s services in Edinburgh. We have been working with the Consultation Institute to plan and develop the consultation activity, and it will be published in the latter part of 2022. The outcome from the consultation will inform the options for the delivery of bed-based services in Edinburgh.