Agenda Document Pack - Midlothian Integration Joint Board - Audit and Risk Committee - 12/09/2024
Midlothian Council · 12 September 2024
Back to Midlothian Integration Joint Board - Audit and Risk Committee — 12 September 2024 and its agenda
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Notice of Meeting and Agenda Midlothian Integration Joint Board - Audit and Risk Committee Venue: Virtual Meeting, Date: Thursday, 12 September 2024 Time: 09:00 Morag Barrow Chief Officer Contact: Clerk Name: Democratic Services Clerk Telephone: Clerk Email: democratic.services@midlothian.gov.uk Further Information: This is a meeting which is open to members of the public. Page 1 of 184
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1 Welcome, Introductions and Apologies 2 Order of Business Including notice of new business submitted as urgent for consideration at the end of the meeting. 3 Declaration of Interest Members should declare any financial and non-financial interests they have in the items of business for consideration, identifying the relevant agenda item and the nature of their interest. 4 Minute of Previous Meeting 4.1 Minute of MIJB Audit and Risk - 6 June 2024 Submitted for approval 3 - 12 5 Public Reports 5.1 Matter Arising - David King -Datix Presentation -Independent Member 5.2 Risk Register 13 - 18 5.3 Annual Accounts 23/24 - report of the appointed auditors - External auditors - To Follow 5.4 Annual Accounts 23/24 19 - 64 5.5 Audit Scotland - Audit report on IJB's 65 - 130 5.6 Audit Report - MIJB directions 131 - 144 5.7 Audit Report - NHS Lothian Directions from IJBs 145 - 184 6 Private Reports No items for discussion 7 Date of Next Meeting The next meeting will be held on Thursday 5 December 2024. Page 2 of 184
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Midlothian Integration Joint Board Meeting Date Time Venue Audit and Risk Committee Thursday, 6 June 2024 2.00pm Virtual Meeting held using MS Teams Present (voting members): Angus McCann (Chair) Councillor McManus Councillor Milligan Councillor Parry Present (non-voting members): Morag Barrow (Chief Officer) David King (Chief Finance Officer (Interim)) Duncan Stainbank (Chief Internal Auditor) Gill Main (Integration Manager) Patricia Fraser (External Auditor) Roxanne King (Executive Business Manager) In attendance: Gary Leadbetter (Democratic Services Officer) Apologies: Val de Souza MIJB – Audit and Risk Committee Thursday, 12 September 2024 Item No 4.1 Page 3 of 184
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2 MIJB - Audit and Risk Committee Thursday 7 March 2024 1. Welcome and Introductions Angus McCann noted that they were stepping in as the Chair in the absence of Val de Souza, whose apologies were provided. The Chair welcomed everyone to the meeting of the Midlothian Integration Joint Board (MIJB) – Audit and Risk Committee. 2. Order of Business The Order of Business was as detailed in the agenda. 3. Declarations of interest No declarations of interest were received. 4. Minutes of Meeting 4.1 The Minute of Meeting of the Audit and Risk Committee held on 7 March 2024 was submitted and approved as a correct record. David King, Interim Chief Financial Officer, explained that there was a comment in the previous minute in relation to setting up training for Datix. They advised that this is addressed in the paper for Item 5.3 and so would be picked up when that Item is discussed. 5. Public Reports 5.1 Scottish Audit Report on Mental Health – Head of Adult Services and Social Care Nick Clater, Head of Adult Services and Social Care, presented the report. Audit Scotland published an audit report in September 2023 on the access to adult mental health services in Scotland. This report noted that: • Funding for adult mental health services in Scotland has increased significantly since 2017; however, the impact remains unclear due to a lack of data. • Access to these services remains challenging. • The mental health workforce faces high vacancy rates, and progress in expanding primary care mental health support is delayed. Page 4 of 184
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3 MIJB - Audit and Risk Committee Thursday 7 March 2024 • Disparities persist, particularly affecting ethnic minorities, rural residents, and those in poverty. • The government lacks sufficient oversight and focuses primarily on waiting times for psychological therapies. • The Scottish Government's progress on mental health commitments is mixed, with further goals not on track for achievement. The Committee were asked to note the report. The Chair thanked Nick Clater for the report and opened it up for questions. Morag Barrow, Chief Officer, stated that it would be useful to see a progress update on this particularly in terms of how the Midlothian perspective is benchmarked against the recommendations. The Chair queried whether Midlothian offered the full choice in relation to face-to-face and virtual. Nick Clater advised that the offer a choice is being rolled out, starting with old age mental health. Nick Clater explained that the default had been face-to-face and that if people were to ask for something else then the alternative would be offered. The Chair stated that when this is brought back it would be useful to bring facts and evidence around data quality and the offer of choice. 5.2 Appointment of an Independent Member to the Audit and Risk Committee – Chief Financial Officer (Interim) David King, Chief Financial Officer (Interim), presented the report. The IJB Audit and Risk committee’s terms of reference lay out the membership of the committee. That is four members from the voting members of the IJB (two from NHSiL and two from Midlothian Council) and an independent member. The latter being an individual who is not a member of the IJB (nor a member of the NHS Lothian Board nor a Midlothian Councillor) and is therefore literally independent from the IJB and its partners. Such an individual will bring their previous experience to the committee, provide an additional input into the work of the committee and support the committee’s role in assuring proper governance. This role is considered best practice in the development of an audit committee and such a member has sat on the IJB’s audit and Risk committee in previous years although currently this role is vacant. The Committee were asked to support the appointment of an independent member to the Committee. Page 5 of 184
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4 MIJB - Audit and Risk Committee Thursday 7 March 2024 The Chair thanked David King for the report and opened it up for questions. Councillor Milligan noted that the Community Planning Partnership (CPP) could be asked to nominate a member. Duncan Stainbank, Chief Internal Auditor, noted that it would be useful to bring on a member with a background in financial accountancy. In relation to the quorum, Duncan Stainbank advised that this might mean that a meeting quorum would be made up of two NHS representatives and an independent or two councillors and an independent. Duncan Stainbank queried whether the Committee would be comfortable with this. It was agreed that the CPP should be asked to nominate a member, but that every route should be explored. It was also agreed that the quorum should be made up of one representative from each of the voting constituents, i.e. one independent, one NHS representative and one councillor. Gill Main, Integration Manager, explained that both they and David King had been liaising with a candidate who had expressed interest, although more on this could not be shared currently. 5.3 Review of Risk Management Policy – Chief Financial Officer (Interim) David King, Chief Financial Officer (Interim), presented the report. The IJB approved its risk management policy at its meeting in February 2016. At its meeting in December 2017, the IJB’s Audit and Risk Committee recognised that ‘the IJB’s risk register (and risk management process) recognises the risk to the IJB’s own business – that is the preparation and delivery of the Strategic Plan. The IJB’s does not consider ‘operational’ risks, being the risks managed by the partners unless these risks are so significant that they would impact on the IJB’s Strategic plan. That said, it should be remembered that IJB is not in a position to manage such operational risks and would, in any event, depend on the management actions of the partners.’ Best practice would require that the IJB now reviews its Risk Management Policy and the paper lays out that review. The Committee were asked to: • Consider the revision and amendments to the current policy. • Recommend these amendments to the IJB. • Recommend that the IJB adopts the revised Risk Management Policy. Page 6 of 184
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5 MIJB - Audit and Risk Committee Thursday 7 March 2024 The Chair thanked David King for the report and opened it up for questions. Gill Main advised that there was a typographical error in the report under 9.3, where it states “aucit” instead of “audit.” Gill Main further queried whether, in 1.5 of the report, the wording should be “treat, tolerate and mitigate risk” instead of “terminate, transfer or treat risk.” They further asked whether something should be noted about tying in the Strategic Planning Group and their role. David King confirmed that they were happy with these suggestions. The Chair queried how Gill Main would envisage taking the SPG risks and conveying them into Risk Management Policy. Gill Main explained that the SPG would still hold the SPG risk register and that anything they felt they were unable to treat or tolerate would be escalated to the Board’s risk register. It was agreed that the changes would be made, that the report would be tidied up and checked for any errors, which would be amended, and that the report would then be shared again with the Committee via email before it is shared with the IJB. 5.4 Risk Register – Chief Financial Officer (Interim) David King, Chief Financial Officer (Interim), presented the report. The report presented the IJB’s Q1 risk register for discussion by the Committee. The Committee were asked to: • Note the Q1 risk register. • Consider if any further additions or changes should be made to the risk register. • Agree to the proposal that, at a future meeting, a presentation on the use of Datix is provided to the Committee along with a further more detailed consideration of the risk register. David King queried whether there should be a slot in the September meeting for the Datix presentation and the consideration of the risk register. Page 7 of 184
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6 MIJB - Audit and Risk Committee Thursday 7 March 2024 Following a short discussion, it was agreed that at the September meeting Roxanne King, Executive Business Manager, would deliver a Datix presentation for Members and that there would be a deep dive into the risk register. The Chair stated that the wording on the first risk on the risk register seems quite general and wide. Duncan Stainback stated the risks in the register are for the IJB, rather than from the partners, and the expectation would be that the partners would manage the risks around disruption to operational service delivery. Duncan Stainbank noted that this is why the risk would be at a high level for the IJB. Roxanne King explained that they and David King would be doing some work around this risk between this meeting and September. There was a discussion around some work needing to be undertaken on the risk register and that how the risks were put on have perhaps not translated well on the Datix system, so it was noted that work would be undertaken on this. 5.5 Best Value Framework – Chief Financial Officer (Interim) David King, Chief Financial Officer (Interim), presented the report. The paper updates the Committee on the duty of Best Value, on how that applies to the IJB and how the IJB can ensure that this duty is delivered. The Committee were asked to request that the IJB develop a best value framework which can then be used to assess the delivery of best value. The Chair thanked David King for the report and opened it up for questions. The Chair asked that David King explain what they envisage a best value framework would look like and how it would be used on an ongoing basis. David King explained that it would lay out all of the discussion that has been had, the duties and the seven broad themes and it would state that every year an officer, presumably the Chief Financial Officer, would look at how the themes have been dealt with, which would be turned into a report for the IJB. This report would ask the Committee whether they feel the IJB has met these themes and, if the IJB felt they have not, then this would allow recommendations to be laid out on how they can be achieved. Patricia Fraser, External Auditor, stated that this was a point that was raised in the External Auditor’s Annual Audit report the previous year. Patricia Fraser stated that their judgment was that the IJB does demonstrate continuous improvement and that this was just about having the Page 8 of 184
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7 MIJB - Audit and Risk Committee Thursday 7 March 2024 framework in place. Patricia Fraser advised that, if it was deemed to be helpful, then good practice examples could be provided. The Chair confirmed that this would be helpful. 5.6 Revision of Terms of Reference – Audit and Risk and Strategic Planning Group – Chief Financial Officer (Interim) David King, Chief Financial Officer (Interim), presented the report. The report presents, for comment only, revised Terms of Reference for the IJB’s Audit and Risk Committee and the IJB’s Strategic Planning Group. The Committee are asked to consider these revised Terms of Reference and reflect on any suggested amendments. The Chair thanked David King for the report and opened it up for questions. The Chair stated that, on page 2 of the SPG’s ToRs, under 3.3 the wording around “Where the Integration Authority is an Integration Joint Board” can be tweaked as the MIJB is an integrated joint board. Also under 3.3, the Chair noted that the wording under the second bullet point “where one local authority is a constituent authority” is not required. The Chair also stated, under 4.1, that it should be eight not ten. 5.7 Review of the Annual Governance Statement – Chief Internal Auditor Duncan Stainbank, Chief Internal Auditor, presented the report. The purpose of the report is to present the draft Annual Governance Statement 2023/24 for the Midlothian Health and Social Care Integration Joint Board (MIJB) which explains the MIJB’s governance arrangements and system of internal control and reports on their effectiveness for the year ended 31 March 2024. The Committee are asked to consider the Midlothian Health and Social Care Integration Joint Board draft Annual Governance Statement 2023/24 (Appendix 1 to the report), which explained the MIJB’s governance arrangements and system of internal control and reports on their effectiveness for the year ended 31 March 2024, and provide any commentary thereon and approve for inclusion in the draft ,Annual Accounts 2023/24. The Chair thanked Duncan Stainbank for the report and opened it up for questions. Morag Barrow stated that where the paper talked about recovery actions that it should be 2024/25, not 2023/24, which Duncan Stainbank agreed with. Page 9 of 184
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8 MIJB - Audit and Risk Committee Thursday 7 March 2024 The Chair noted that there are three corrections to be made to the paper, firstly that the CIPFA/SOLACE Framework does not need to be referenced to as new, that it should be noted that the code of conduct should also be adhered to and that it should also include that board papers are published. 5.8 Internal Audit Reports – Chief Internal Auditor Duncan Stainbank, Chief Internal Auditor, presented the report. The purpose of the report is to present the Internal Audit Annual Assurance Report 2023/24 for the Midlothian Health and Social Care Integration Joint Board (MIJB) which includes the Chief Internal Auditor’s independent assurance opinion on the adequacy of the arrangements for governance, risk management and internal control by the MIJB of the delegated resources. The Committee are asked to consider the MIJB Internal Audit Assurance Report 2023/24 (Appendix 1 to the report), which sets out the findings and conclusions arising from all Internal Audit work carried out for the year to 31 March 2024, consider the assurances contained therein, and provide any commentary thereon. The Chair thanked Duncan Stainbank for the report and opened it up for questions. Gill Main stated that some of the timescales around the recommendations are not achievable against the timelines stated, due to the delay in receiving the report, noting that they are looking for support to extend the timescales so that they are more manageable. Duncan Stainbank stated that they did not think anything needed to be changed in terms of the report, as it is looking back at the previous year, but that they were happy to extend the dates of the recommendations to meet the requirements of Gill Main’s team. Morag Barrow asked the Committee to approve writing to the Council to ask for support around publication, which the Committee agreed with. 5.9 MIJB Internal Audit Report: Publication Scheme – Chief Internal Auditor Duncan Stainbank, Chief Internal Auditor, presented the report. The purpose of the report is to present the findings and recommendations from the recently completed Internal Audit review of the Publication Scheme, completed in partnership between the Midlothian Council and NHS Lothian Internal Audit teams. Page 10 of 184
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9 MIJB - Audit and Risk Committee Thursday 7 March 2024 The Committee are asked to consider the findings and recommendations from the recently completed Internal Audit review of the Publication Scheme. The Chair thanked Duncan Stainbank for the report and opened it up for questions, of which there were none. 6. Private Reports No private business discussed at this meeting. 7. Date of next meeting The next meeting will be held on Thursday, 5 September 2024 at 2.00pm. (Action: All Members to Note) The meeting terminated at 15:19pm. Page 11 of 184
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Midlothian Integration Joint Board Audit and Risk Committee Midlothian IJB Risk Register – Q2 2024/25 Thursday 12th September 2024 Item number: 5.2 Executive summary This report presents the IJB’s Risk Register for Q2 2024/25. The IJB maintains a risk register which is presented to every meeting of this committee and reviewed by management quarterly prior to the next meeting of the committee. At its June 2024 meeting the committee requested that the risk titles be clarified as these were currently quite general and wide. These have now been reviewed and laid out below. A new risk has been added reflecting the potential impact of decisions made by the IJB’s partners and the Scottish Government and the risk rating on risk 5775 ‘Impacts of New Legislation’ has been increased to address any impact of the IJB from the current amendments to the National Care Service Bill. Committee members are asked to: 1. Note the Q2 Risk Register. 2. Consider if any further additions or changes should be made to the risk register. 3. Agree to the proposal that, at a workshop, a presentation on the use of Datix is provided to the committee along with a further, more detailed consideration of the management of the risk register. Page 13 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 2 Report 1. Purpose 1.1 This report presents the IJB’s Q2 risk register for discussion by the committee. 2. Recommendations 2.1 Committee members are asked to • Note the Q2 risk register. • Consider if any further additions or changes should be made to the risk register. • Agree to the proposal that, at a workshop, a presentation on the use of Datix is provided to the committee along with a further, more detailed consideration of the management of the risk register. 3. Background and main report 3.1 The IJB maintains a risk register in line with best practice. This register lays out the risks to the operation of the IJB – that is risks to the development of the Strategic Plan and the delivery of that plan though directions to its partners. 3.2 The register was last presented to the committee at its June 2024 meeting and the committee asked that the risk titles be clarified, the current titles being quite general and wide. These will now be amended as follows :- Risk ID Current Title Amended risk title 5771 Strategic Commissioning Plan Partners operational resources are inadequate or unable to deliver the IJB’s Strategic Plan 5772 Issuing of Directions The IJB’s partners are unable to deliver the IJB’s directions. 5773 Category 1 responder status The IJB cannot properly deliver its category 1 responder status if the partners are unable to provide the necessary assurances 5774 Financial Sustainability The IJB cannot deliver its Strategic Plan due to insufficient financial resources Page 14 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 3 5775 Impact of new Legislation New (and amended) national legislation will impact on the activities of the IJB and its ability to deliver its Strategic Plan New Impact of the partners or the Scottish Governments decisions on the IJB and its Strategic Plan 3.3 Under risk 5775 (Impact of new legislation) the risks to the IJB from the National Care Service Bill are, having had sight of and further briefings on the proposed amendments to the BCS Bill, are now greater than is currently reflected in the register. The likelihood has now been altered to ‘almost certain’ 3.4 The updated risk register is attached as appendix 1. It should be noted that this is an extract from Datix and that there is a range of further information embedded in the Datix system which does not form part of this extract. 4. Policy Implications 4.1 There are no further policy implications arising from this report. 5. Equalities Implications 5.1 There are no equalities implications arising from this report 6. Resource Implications 6.1 There are no resource implications arising from this report. 7 Risks 7.1 The risks are described in the risk register which is attached 8 Involving People 8.1 There are no direct implications for involving people as a result of this report. 9 Background Papers 9.2 None AUTHOR’S NAME David King DESIGNATION Interim Chief Finance Officer CONTACT INFO david.king4@nhslothian.scot.nhs.uk Page 15 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 4 DATE September 2024 Appendix 1 – Risk Register Extract– Q2 2024/25. Page 16 of 184
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ID Consequence (Current) Likelihood (Current) Risk Level (Current) Consequenc e (Target) Likelihood (Target) Risk Level (Target) Date opened 5771 Chief Officer Integration Manager Partners operational resources are inadequate or unable to deliver the IJB’s Strategic Plan Risk Effect: Partners operational services may experience disruption to service delivery. Risk Consequence: The IJB may not see sufficient or adequate progress towards its 6 strategic aims and delivering its strategic plan. Reassurance is required from partners regarding the following 1. Resilience planning and Business continuity 2. Contract monitoring 3. Governance and Assurance 4. Outcomes for people and communities Major Almost Certain Very High Minor Possible Medium 26/02/2024 5772 Chief Officer Integration Manager The IJB’s partners are unable to deliver the IJB’s directions. Risk Effect: There is a risk that the IJBs partners have insufficient workforce or other resources to execute the requirements and ambitions of the IJB Directions Risk Consequence: The IJB cannot deliver on its strategic plan or financial plan. Directions are monitored and reported on twice a year for performance updates. financial allocations are included within directions on an annual basis after IJB budgets have been set The Planning, Performance and Programme team continue to support with additional capacity to redesign and transform key areas of service delivery A project management approach continues to support key areas aiming to accelerate progress in the delivery of the MIJB Directions. Extreme Almost Certain Very High Moderate Possible Medium 26/02/2024 5773 Chief Officer Executive Business Manager The IJB cannot properly deliver its category 1 responder status if the partners are unable to provide the necessary assurances Risk Effect: IJBs role as Category 1 responders under the Civil Contingencies Act requires that our partners NHS Lothian and Midlothian Council maintain effective business continuity and resilience plans to ensure an appropriate response in times of emergency. There is a risk that our partners may not be able to provide these assurances. Risk Consequence: Failure to maintain up to date and effective resilience plans could result in services unable to maintain essential service delivery Assurance reporting to IJB routinely by Chief Nurse, Chief Social Worker and Resilience. Annual category 1 assurance report submitted to IJB via A&R comittee Robust operational process within Midlothian Health and Social Care to meet requirements Lessons learnt from COVID pandemic have been incorporated within standard service delivery, ongoing work to develop a quality management approach will provide additional partnership wide assurances to IJB. Moderate Unlikely Medium Minor Unlikely Medium 26/02/2024 5774 Chief Officer Chief Finance Officer The IJB cannot deliver its Strategic Plan due to insufficient financial resources Risk Effect: The IJBs partners may not be able to allocate sufficient resource to deliver its Financial Plan and Strategic Plan. Risk Consequence: The IJB may not be able to deliver the Strategic Plan in order to function within the available resources. The IJB may have to amend the ambitions of Strategic in such a way that the progress towards the 6 strategic aim of the Strategic Plan and 9 National Health and Wellbeing Outcomes is compromised. Chief Finance Officer responsible for the governance, appropriate management of finance and financial administration of the IJB. Strong budgetary control systems in place within NHS Lothian and Midlothian Council. IJB Medium term financial plan developed annually. Working in partnership in the financial environment with Midlothian Council and NHS Lothian. IJB Set a balanced budget at its March 2024 meeting Extreme Almost Certain Very High Moderate Possible Medium 26/02/2024 5775 Chief Officer Chief Finance Officer New (and amended) national legislation will impact on the activities of the IJB and its ability to deliver its Strategic Plan Risk Effect: There is a risk of further legislation, policy, or national improvement drivers which impact on the IJBs ability to deliver on the Strategic Plan, examples include the legislation relating to a National Care Service and the Health and Care (Staffing) (Scotland) Act 2019. Risk Consequence: The IJB and it partners may be distracted from the business of delivering the Strategic Plan. Legislation, policy, and national improvement drivers without fiscal supports will result in additional pressure on the IJB. Respond to Scottish Government information requests on impact of future legislation, policies, and national improvement drivers Horizon scanning for policy developments through partners and SMT network groups Close working relations with Scottish Government through Chief Finance Officer, Chief Officer and COSLA. Major Almost Certain High Moderate Possible Medium 26/02/2024 New Chief Officer Integration Manager Impact of the partners or the Scottish Governments decisions on the IJB and its Strategic Plan Risk Effect - decisions made by partners driven by financial, operational or legislative pressures may impact on the IJB. Risk Consequence - the IJB may not be able to deleiver its strategic plan Close working with the IJB's Partners Moderate Possible Q2 2024/25 Risk Register Extract Risk Owner Risk Handler Title Description Controls in place Residual Risk Target Risk Page 17 of 184
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Midlothian Integration Joint Board 2023/24 Audited Annual Accounts Thursday 12th September 2024 Executive summary As a statutory body, the IJB is required to produce a set of annual accounts at the end of its financial year (31 March). These accounts are then reviewed by the IJB’s external auditors who report their opinion of the IJB’s annual accounts to the IJB’s Audit and Risk Committee. This report having been agreed by the committee and presuming no outstanding issues, the IJBs annual accounts can then be approved. The accounts will then be signed by the Chair of the IJB, the Chief Officer of the IJB and the Chief Finance Officer of the IJB. Board members are asked to: 1. Note the report of the independent auditor 2. Consider the 2023/24 annual accounts of the IJB. 3. Recommend approval of the accounts by Chief Officer in consultation with Chair and Vice-Chair in terms of Standing Order 15.1 # Item number: 5.4 Page 19 of 184
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Midlothian Integration Joint Board Report 2023/24 Audited Annual Accounts 1 Purpose 1.1 The IJB has prepared annual accounts for the financial year 2023/24; these have now been audited by the IJB’s Independent Auditors. Their report has been presented to committee at a previous agenda item. 2 Recommendations 2.1 As a result of this report Members are being asked to:- • Note the report of the independent auditor • Consider the 2023/24 annual accounts of the IJB. • Recommend approval of the accounts by Chief Officer in consultation with Chair and Vice-Chair in terms of Standing Order 15.1 3 Background and main report 3.1 As a body governed by section 110 of the Local Government Scotland Act (1973) and the appropriate regulations and subsequent Acts, the IJB must prepare a set of annual accounts. The accounts must fulfil the requirements of the Act and the regulations and must give a true and fair view of the IJB’s financial position. 3.2 The accounts must then be reviewed by an Independent Auditor who will report their findings to this committee which will allow the auditors to bring any matters to the committee’s attention. If there are no issues arising from the auditors’ report, then the committee can recommend acceptance and the annual accounts can be approved. 3.3 After approval the Annual Accounts of the IJB, these will be signed by the Chair of the IJB, the Chief Officer of the IJB and the Chief Finance Officer of the IJB. 3.4 The Unaudited Annual Accounts (unsigned) are attached to this report. It should be noted that the unaudited annual accounts attached to this paper will be amended to include the report of the external auditor. This will then be presented to the IJB for approval. 4 Policy Implications 4.1 There are no policy implications from this report. Page 20 of 184
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Midlothian Integration Joint Board 5 Directions 5.1 There are no implications on directions from this report. 6 Equalities Implications 6.1 There are no equalities implications from this report 7 Resource Implications 7.1 There are no resource implications from this report. 8 Risk 8.1 The risks raised by this report are already included within the IJB risk register. 9 Involving people 9.1 The IJB’s annual accounts will be published on the IJB website. 10 Background Papers 10.1 None. AUTHOR’S NAME David King DESIGNATION Interim Chief Finance Officer CONTACT INFO David.king4@nhs.scot DATE September 2024 Appendix 1 – 2022/23 Unaudited Annual Accounts Page 21 of 184
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1 Midlothian Integration Joint Board (IJB) Unaudited Annual Accounts 2023/24 The Annual Accounts of Midlothian Integration Joint Board for the period from 1 April 2023 to 31 March 2024, prepared pursuant to Section 105 of the Local Government (Scotland) Act 1973 and in accordance with the terms of the CIPFA/LASAAC Code of Practice on Local Authority Accounting in the United Kingdom 2023/24. Page 23 of 184
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2 Contents Audit Arrangements ............................................................................................... 3 Management Commentary ..................................................................................... 4 Statement of Responsibilities ................................................................................ 22 Remuneration Report ........................................................................................... 24 Annual Governance Statement 2023/24 ................................................................. 27 Independent Auditor’s Report ............................................................................... 32 Comprehensive Income and Expenditure Statement ................................................ 33 Movement in Reserves Statement ......................................................................... 34 Balance Sheet ..................................................................................................... 35 Notes to the Financial Statements ......................................................................... 36 Page 24 of 184
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3 Audit Arrangements Under arrangements approved by the Accounts Commission of Local Authority Accounts in Scotland, the auditor with responsibility for the audit of the accounts of Midlothian Integration Joint Board for the period 1 April 2023 to 31 March 2024 is Audit Scotland, 102 West Port, Edinburgh EH3 9DN. Page 25 of 184
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4 Management Commentary Introduction The management commentary considers the work that the Integration Joint Board (IJB) has undertaken during the financial year 2023/24, and then describes the financial performance for the financial year ended 31 March 2024. It provides an overview of the key messages relating to the role, remit, members, objectives, and the strategy of the IJB. The Role and Remit of the Integration Joint Board The IJB is an Integration Authority set up under the Public Bodies (Joint Working) (Scotland) Act (2014). It is a ‘body corporate’, that is a separate legal entity. The IJB is constituted through its Integration Scheme which was prepared by Midlothian Council and NHS Lothian and presented to Scottish Ministers in March 2015. The Integration Scheme was approved by the Scottish Parliament in June 2015 and the first meeting of the IJB took place on 20 August 2015. A review of the Integration Scheme was undertaken during 2022 and approved by Midlothian Council and NHS Lothian in June 2022 and has been approved by the Scottish Government. The IJB’s role and responsibility is to plan for the delivery of the functions that have been delegated to the IJB by Midlothian Council and NHS Lothian. These functions are - • Adult Social Care • Primary Care Services (GP Practices, Community Dentists, Community Pharmacies and Community Opticians) • Mental Health Services • Physical and Learning Disabilities Services • Community Health Services • Community Hospital Services • Unscheduled Care Services (services that are generally delivered from the Royal Infirmary of Edinburgh, the Western General Hospital and St. John’s Hospital). The IJB assumed formal responsibility for these functions in April 2016 including the budgets for the delivery of these functions. The strategic plan of each IJB must be reviewed and approved by the IJB every 3 years. During March and April 2022 the IJB considered and approved its third Strategic Plan which covers April 2022 to March 2025. Page 26 of 184
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5 Membership of Integration Joint Board The IJB met 7 times in 2023/24 for formal business meetings and there was one workshop. The members of the IJB as of March 2024 Member Nominated/Appointed by Role Conor McManus Nominated by Midlothian Council Voting Member, Chair Val de Souza Nominated by NHS Lothian Voting Member, Vice Chair and Chair of the Audit and Risk Committee Pauline Winchester Nominated by Midlothian Council Voting Member Derek Milligan Nominated by Midlothian Council Voting Member Kelly Parry Nominated by Midlothian Council Voting Member Angus McCann Nominated by NHS Lothian Voting Member Andrew Fleming Nominated by NHS Lothian Voting Member Nadin Akta Nominated by NHS Lothian Voting Member Morag Barrow Appointed by the IJB Chief Officer David King Appointed by the IJB Interim Chief Finance Officer Joan Tranent Nominated by Midlothian Council Chief Social Worker Fiona Stratton Nominated by NHS Lothian Chief Nurse Johanne Simpson Nominated by NHS Lothian Medical Practitioner Rebecca Green Nominated by NHS Lothian General Practitioner Grace Chalmers Appointed by the IJB MLC Staff Side Representative Claire Ross Appointed by the IJB Head Allied Health Professional Marlene Gill Appointed by the IJB User Representative Keith Chapman Appointed by the IJB User Representative/Carer Representative Wanda Fairgrieve / Jordan Miller Appointed by the IJB NHS Staff Side Representative Note. Claire Flanagan was the IJB’s Chief Finance Officer until 30th September 2023 when she resigned to take up another appointment. David King has been appointed as interim Chief Finance Officer until a permanent appointment can be made. Page 27 of 184
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6 Integration Joint Board’s Vision and Objectives The IJB’s vision and objectives are laid out in the IJB’s Integration Scheme, and these reflect the nine national health and wellbeing outcomes which apply to integrated health and social care. These are: 1. People are able to look after and improve their own health and wellbeing and live in good health for longer. 2. People, including those with disabilities or long-term conditions or who are frail are able to live, as far as reasonably practicable, independently and at home or in a homely setting in their community. 3. People who use health and social care services have positive experiences of those services, and have their dignity respected. 4. Health and social care services are centred on helping to maintain or improve the quality of life of people who use those services. 5. Health and social care services contribute to reducing health inequalities. 6. People who provide unpaid care are supported to look after their own health and wellbeing, including to reduce any negative impact of their caring role on their own health and wellbeing. 7. People using health and social care services are safe from harm. 8. People who work in health and social care services feel engaged with the work they do and are supported to continuously improve the information, support, care and treatment they provide. 9. Resources are used effectively and efficiently in the provision of health and social care services. The IJB also contributes to the achievement of the national criminal justice outcomes because the Parties have elected to delegate criminal justice social work. Page 28 of 184
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7 The Integration Joint Board’s Operations for the Year 2023/24 The Strategic Plan is delivered through the IJB’s Directions to its partners (Midlothian Council and NHS Lothian). The IJB issued Directions for 2023/24 to the Chief Executives of both partners on 30th March 2023. A report was presented to the IJB at its meeting in September 2023 which updated the IJB on the half year status regarding the delivery of the Directions for 2023/24. This will be considered further as part of the publication of the IJB’s Annual Performance Report which is due to be published by October 2024. Progress in 2023/24 against the delivery of the Integration Joint Board’s goals. 1. Health and Wellbeing – people are able to look after and improve their health and wellbeing and live in good health for longer. The Health Inclusion Team has continued to provide outreach and carried out health assessments with 171 people since April 2023. Most assessments were in the person’s home and the most frequent intervention was in relation to healthcare and lifestyle, followed by advocacy / liaison with / referral to partner agencies. Representation has been provided to a number of key working groups to promote a public health agenda, including the trauma training steering group, Mid & East Lothian Drug and Alcohol Partnership Group, Midlothian Suicide Prevention Group, Equally Safe Strategy Leadership Group, Midlothian will be Healthier Thematic Group, Lothian Green Health Network and the Third Sector Summit. Local and regional efforts have continued within the whole systems approach to Type II diabetes, ensuring alignment with NHS Lothian’s public health priorities and the partnership’s objectives. This has included the evaluation of funded projects to help the people of Mayfield and Easthouses have more access to healthy food options, keep physically active and have more money in their pockets. 2. Living in the Community – People are able to live, as much as possible, independently and at home or in a homely setting. Mental Health services for adults aged 18+ have 33 digital on-line self-help platforms used across the service. Midspace is one example and there has been a 33% increase in access. Page 29 of 184
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8 The national transfer of phone lines from analogue to digital means that all MidCare equipment, including falls alarms, needs to be updated. So far, 35% of this equipment in peoples’ homes has been replaced. 3. Positive Experiences and Dignity – People who use health and social care services have positive experiences of those services, and have their dignity respected. Good progress has been made in relation to our ability to use outcome mapping to better inform service redesign that is person led. The Dietetics hosted service has provided representation to the NHS Lothian Strategic Falls Group and the local Midlothian Community Hospital Falls Group. An initial organisation-wide Frailty Event has taken place with representation and engagement from all relevant service stakeholders, including Head of Primary Care & Older People, Clinical Director, Chief Nurse and Chief Allied Health Professional. All staff working in Community Justice have been trained to Level 2 Trauma (National Education for Scotland), and all Adult Support and Protection and Duty staff have completed Level 1 Trauma training. It should be noted, and this applies to goals 4 and 5 below, that the externally produced, fully validated indicators are not available at the time of the preparation of these accounts. However, all of this information will be available in the IJB’s Annual Performance Report for 2023/24 which will be approved by the IJB at its October 2024 meeting. 4. Quality of Life – Health and social care services help to maintain or improve the quality of life of people who use those. A number of services have collated feedback from patients and relatives on their experiences including: • The wards and Allied Health Professionals within Midlothian Community Hospital – looking at experiences of care and rehabilitation. • Highbank Intermediate Care Facility – looking at respite. • Occupational Therapy and Physical Disabilities service – looking at the impact of their service. People have fed back that even a small piece of equipment or change to their home environment can make a huge difference to the quality of their life. Page 30 of 184
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9 • Mid & East Lothian Drug and Alcohol Partnership – looking at prevention, children and families services, treatment service and recovery. • All Mental Health services, CAPS Advocacy, substance use services VOCAL – looking at Medication Assisted Treatment standards, and trauma-focused support. • The Duty Social Work Team – looking at experiences of all people in contact with them. • Community Justice – looking at experiences of community-based sentences. • Spring Service and women who are supported as part of the Caledonian system – looking at their experience of support. • The Care at Home team – looking at experiences of people with a package of care. • The 0-5 Immunisations Service – looking at experience of the winter Flu campaign. • The Health Visiting service – looking at experiences of care. • The Dietetics hosted service – looking at experience of patients newly discharged on home enteral feeding. • Musculoskeletal Physiotherapy and General Practice Advanced Practice Physiotherapists – looking at patient experience. 5. Health Inequalities - Health & social care services contribute to reducing health inequalities. Following Midlothian’s lead role in the pan-Lothian efforts to improve data visualisation, improved mechanisms have been put in place that allow increased disaggregation of NHS data, including the ability to better understand the impact of economic deprivation. 6. Support for Carers - People who provide unpaid care are supported to look after their health and wellbeing. A new model of respite has been introduced at Highbank Intermediate Care Facility to meet the changing needs of people who require support, and their unpaid carers. To date, 13 referrals have resulted in 16 respite bookings. The Duty Social Work Team have continued to work with colleagues and Vocal to identify and support unpaid carers. Within this quarter there were a total of 64 referrals received with the reason for making contact noted as ‘Carer Stress’. Page 31 of 184
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10 An initial meeting was held between Carer and Home First Service Leads to connect the relevant Health and Social Care Partnership, Health and Voluntary Sector partners to take forward mapping/planning, establishing stakeholders, services, processes and timescales involved in the discharge process, to re-establish referral pathways and connections. Work has started to scope the feasibility of a cooperative to support carers in Midlothian. Key stakeholders have met to understand and establish priority focus areas as part of this scoping exercise and to agree a timeline. 7. Safe from Harm - People using health & social care services are safe from harm. The Adult Support and Protection Team have undertaken a range of duties to identify, minimise and manage risk and ensure that all suspicions, disclosures or incidents of actual harm are acted upon. Health Visiting have engaged in appropriate activity to ensure the safety of mothers of children under 5 years who are at risk of harm. This included ensuring the Equally Safe Strategy, and the NSPCC Harmful Sexual Behaviours Framework and Action Plan, are all in place. Within Substance Use services, the percentage of people commencing treatment within 21 days of referral reached 100% at the end of 2023/24. The Pharmacy Service has established Medicine Reconciliations support to all Midlothian GP practices to ensure safe, effective and timely access to medicines. The locally designed hub model has increased Immediate Discharge Letter (IDL) output from the Pharmacy team by 323% from 2021/22. 100% of IDLs are now completed by pharmacy, with 97% completed within the 48-hour target turnaround time. 8. Workforce - Staff are engaged with their work and are supported to continuously improve the information, support, care and treatment they provide. iMatter is the survey used to capture and measure Health and Social Care Partnership (HSCP) staff engagement levels. The survey is run on an annual basis in July. Midlothian HSCP has increased iMatter Employee Engagement Scores over the last three years. Response rate to iMatter Employee Engagement Scores Page 32 of 184
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11 Year Response Rate Employee Engagement Rate Action Plans Agreed 2023 55% 80 69% 2022 48% 78 35% 2021 50% 77 2% Response rates for 2023 were higher than during the previous two years, and work has continued in 2023/24 to achieve the response rate target of 60%. Examination across all domains described in the 2023 Midlothian HSCP Directorate report has helped identify opportunities for targeted action to improve staff engagement and wellbeing. We have completed a full review of the functionality, effectiveness and uptake of Health and Social Care specific LearnPro modules. The ‘Haven’ staff wellbeing space has opened on site. The Soup Stop (this being a drop-in facility at Midlothian Community Hospital for HSCP staff support by donation) has continued to play a key role in supporting staff wellbeing, with over 200 staff benefitting. Between April and September 2023, a consultative and collaborative process was undertaken to establish the governance structure of the Midlothian Integrated Workforce Governance Board which commissions and oversees the work of two Subgroups: Workforce Planning (Access and Demand) and Staff Engagement (Staff Governance & Development). The Midlothian Integrated Workforce Governance Board has provided oversight of the work required to deliver the HSCP Integrated Workforce Plan 2022-25. This strategic workforce plan forms a key part of the work to align strategic, financial, and operational plans to ultimately support the delivery of right staff, in the right place, at the right time, within budget. The iMatter survey results for 2024 are not available at the time of the preparation of these accounts. 9. Use of Resources - Resources are used effectively and efficiently. All services have attended a series of three Financial Recovery Workshops hosted by Midlothian Health and Social Care Partnership with support from NHS Lothian’s Sustainability & Value Team. All services were required to submit Financial Recovery Templates. Page 33 of 184
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12 Ongoing work has continued to connect the strategic and financial ambitions of the IJB, to operational strategic and financial planning, through Midlothian HSCP’s Operational Transformation Group, alongside Midlothian HSCP’s Finance and Performance Group. Examples of work already completed / currently underway include the Midlothian Bed- Based Care Review, the redesign of Home First, and a review of the strategy and vision for Newbyres Care Village. The Tableau Dashboard that provides management data relating to emergency / unscheduled care has been further developed and can now be fully interrogated at Health and Social Care Partnership (HSCP) level (including SIMD filters). Pan-Lothian work has continued to improve the quality and consistency of protected characteristic cohort data. The 0-5 Immunisations Midlothian data has shown an uptake rate of 61.5% for seasonal flu, compared to a 54.2% pan-Lothian update (Midlothian has the highest uptake across the Lothians). The Health Visiting service has worked alongside data analysts to build a way of linking assessments over time to demonstrate effective early intervention. Outcome Mapping Outcome Mapping is used to understand how our services contribute to our strategic aims and the outcomes that matter to people. The Outcome Mapping approach was developed by our partners, Matter of Focus and the bespoke design and architecture for Midlothian Health and Social Care Partnership was designed by the Planning and Performance team. Each ‘stepping-stone’ of the outcome map framework includes a set of success criteria aligned to the Care Inspectorate joint inspection framework. The outcome map is colour- coded to show an evaluation of the extent to which the service is making progress towards personal outcomes and confidence in how strong the evidence is to support that progress rating. This results in a two-factor rating system for each stepping-stone in the outcome map. Midlothian IJB has been asked to share this work with Audit Scotland, Healthcare Improvement Scotland (HIS), the Blavatnik School of Government at Oxford University, the Scottish Government team developing the National Improvement Framework for Adult Social Care and Community Health and most recently the team developing a new improvement framework for health that will support person centred care. Governance The IJB has continued to review and update its governance during the financial year ensuring that the IJB’s Strategic Plans are fully compliant with best practice and the Scottish Page 34 of 184
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13 Government’s latest guidance. The following were presented to and agreed by the IJB during the year: • April 2023 – Mainstreaming Equalities Report and Action Plan 2023-25 • June 2023 – Integrated Impact Assessment Process Review • August 2023 - Governance Plan • December 2023 – Scheme of Publication • February 2024 – Self-Improvement development plan The IJB has moved from holding its meetings virtually to a hybrid model where the meeting is held face to face but members may join virtually if they wish. Plans for next year and beyond. Reflecting on the current challenging financial position, the IJB is not proposing to issue a new set of Directions in 2024/25 to allow the IJB and the partners further time to consider the impact of the current overall financial position. The Directions will clearly reflect the IJB’s budget setting actions ensuring that the partners understand that these have to be delivered. During the financial year (2024/25) financial reporting and planning will be progressed with the ambition of moving towards a balanced five year financial plan. This work will be part of the review of the IJB’s Strategic Commissioning Plan to ensure that the IJB’s financial plan will clearly articulate, in financial terms, how the IJB’s Strategic Commissioning Plan will be delivered. The IJB’s partners (Midlothian Council and NHS Lothian) also have a range of significant financial challenges in 2024/25 and thereafter, and the IJB will continue to work closely with the partners to review and revise the Strategic Commissioning Plan and its operational delivery through its Directions. Page 35 of 184
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14 Integration Joint Board’s Financial Performance in 2023/24 For the year ending 31 March 2024 the IJB recorded a deficit of £12,358,000. That meant that costs incurred in delivering the IJB’s functions by Midlothian Council and NHS Lothian were greater than the income received from those partners in the financial year. The IJB has used its reserves to underpin this deficit and has broken-even in the financial year. Summary of the IJB’s financial position for the year ending 31 March 2024 Year-end Position Health £000’s Social Care £000’s Total £000’s Income £129,168 £57,416 £186,584 Income received from the partners Midlothian Coun- cil and NHS Lothian in 2023/24 Expenditure £132,906 £66,036 £198,942 Expenditure incurred by the partners in the delivery of the IJB’s delegated functions for 2023/24. Surplus/ (Deficit) -£3,738 -£8,620 -£12,358 Planned Use of reserves £1,497 £4,679 £6,176 The IJB carried funding from 2022/23 which it planned to use in 2023/24 through its reserves. This funding has been used as planned in 2023/24. Unplanned Use of reserves £2,241 £3,941 £6,182 At this point the IJB still was in deficit. The IJB has therefore used the entirety of its available reserves to achieve break-even in 2023/24. Position at Year end £0 £0 £0 During the financial year 2023/24 the IJB has an in-year deficit in both its health and social care functions. The deficit in the health services is being driven by pressures within GP prescribing services as a result of increased demand, and within the costs of the functions delegated to the IJB delivered in Acute Hospitals (The Royal Infirmary of Edinburgh and the Western General hospital) also as a result of increased demand. Within the IJB’s social care services, pressures are largely due to increased demand although there were also funding issues in year. The funding issues are discussed further below. There is an impact in both the IJB’s Health and Social Care budgets from the recent Covid 19 pandemic. The pandemic has increased the costs of the delivery of both social care and health services but there has not been any additional funding to support this pressure. Page 36 of 184
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15 Funding for the Integration Joint Board The IJB is funded exclusively by its partners – Midlothian Council and NHS Lothian. The funding is to support the delivery of the functions that the partners have delegated to the IJB. For the sake of clarity, these functions are now called ‘services’. NHS Lothian’s funding is split into three broad areas – • Core Funding – this is funding for health services delivered directly in Midlothian. This includes the running costs of the local hospitals, the community health services, the running costs of the Medical General Practitioners services (the local GPs) and a share of other primary care services (General Ophthalmic Services, General Dental Services and General Pharmaceutical services). • Hosted Funding – the funding for the Midlothian Share of services delivered and managed on a pan-Lothian basis by NHS Lothian. For example Mental Health in- patients beds at the Royal Edinburgh Hospital. • Set Aside Funding – this is a budget ‘set aside’ by NHS Lothian on behalf of the IJB representing Midlothian’s share of delegated unscheduled care services managed by NHS Lothian’s Acute Services and delivered at the Royal Infirmary of Edinburgh, the West General Hospital and St. John’s Hospital at Howden. Midlothian Council’s funding is for the delivery of Adult Social Care services. Budget offers (representing the funding) are made to the IJB by the partners prior to the start of each financial year. The IJB then assesses these offers and bases its acceptance of these offers on the guidance from the Scottish Government which it issues as part of its own budget setting process. At its March 2023 meeting the IJB accepted the indicative budget offer from NHS Lothian but did not accept the budget offer from Midlothian Council, on the basis that it did not meet the criteria laid out by the Scottish Government guidance. After further discussions the Council was unable to amend its offer and the IJB then accepted the position but had to deliver further savings plans to address the shortfall. Reserves There has been a very significant reduction in the IJB’s reserves during the financial year from an opening balance of £13,100,000 at 1 April 2023, to a closing balance of £799,000 as at 31 March 2024. Of this reduction in reserves, £6,177,000 was planned - these reserves had been carried forward from the previous financial year to support ‘earmarked’ projects in 2023/24. A further £6,182,000 of available reserves was required to be used to underpin the IJB’s financial position in year. The IJB has a reserves policy with the intention to hold an available reserve (a general reserve) of c. 2% of its net expenditure. The resolution to the 2023/24 financial position means that the IJB now has no available reserves. This creates an additional financial risk to the delivery of the 2024/25 financial position. Page 37 of 184
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16 Integration Joint Board spend in 2023/24. Analysis of the Financial Statements The Financial Statement are all presented on a net basis. The table below lays out the performance of the services that are delegated to the IJB for 2023/24 Health Social Care Health Social Care Variance Note Budget Budget Expendi- ture Expendi- ture £000’s £000’s £000’s £000’s £000’s Direct Midlothian Services Community AHPS £3,504 £3,437 £67 Community Hospitals £7,967 £7,933 £34 District Nursing £8,649 £8,700 -£51 General Medical Services £17,956 £18,040 -£84 Health Visiting £2,623 £2,683 -£60 Mental Health £3,039 £3,379 -£340 Other £5,201 £8,013 -£2,812 1 Prescribing £21,195 £21,917 -£722 Resource Transfer £6,928 £6,928 £0 2 Older People £25,451 £30,816 -£5,365 Learning Disabilities £19,166 £22,424 -£3,258 Mental Health £1,205 £1,049 £156 Physical Disabilities £3,917 £4,224 -£307 Assessment & Care Manage- ment £3,972 £3,902 £70 Social Care Other £3,705 £3,621 £84 3 Midlothian Share of Pan Lo- thian Set Aside £22,784 £24,328 -£1,544 4 Mental Health £3,249 £3,379 -£130 Learning Disabilities £1,430 £1,419 £11 GP Out of Hours £1,358 £1,358 £0 Rehabilitation £1,011 £879 £132 Page 38 of 184
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17 Sexual Health £824 £815 £9 Psychology £1,681 £1,515 £166 Substance Misuse £592 £574 £18 Allied Health Professions £1,740 £1,682 £58 Oral Health £963 £862 £101 Hosted Other £4,143 £4,070 £73 Dental £6,198 £6,198 £0 5 Ophthalmology £1,964 £1,964 £0 5 Pharmacy £4,169 £4,169 £0 5 Sub Totals £129,168 £57,416 £134,242 £66,036 -£13,694 NHS reserves adjustment -£1,336 £1,336 6 Per Annual Accounts £129,168 £57,416 £132,906 £66,036 -£12,358 Notes 1. Other includes £4.816m for the Social Care Fund which is held in the Health Budget but expended in the social care services. It also includes £1.336m of funds held by NHSiL on behalf of Midlothian Council, this is further explained in note 6 below. 2. Resource Transfer are funds for specific purposes which are transferred from health to social care. However, these remain part of the health budget and are reported there. 3. Social Care Other includes care for non-specific groups, substance misuse services and other management and performance costs. 4. Set Aside are the budgets for those functions delegated to the IJB which are managed by the Acute Services management teams within NHS Lothian. These services are: ▪ Accident and Emergency ▪ Cardiology ▪ Diabetes ▪ Endocrinology ▪ Gastroenterology ▪ General Medicine ▪ Geriatric Medicine ▪ Rehabilitation Medicine ▪ Respiratory Medicine ▪ Various ancillary support services for the above These services are delivered at the Royal Infirmary of Edinburgh, the Western General Hospital and St. John’s Hospital. 5. In the Health system, expenditure to support the delivery of community dentistry, community opticians and community pharmacists is termed as ‘non-cash limited’ (NCL) but is clearly part of the delivery of primary care services and these functions are delegated to the IJB. However, being NCL there is no budget as such, but any expenditure incurred is supported in its entirety by the Scottish Government. The NCL values are not Page 39 of 184
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18 part of the budget setting process, there being no budget, but NHS Lothian has matched the NCL expenditure with income to cover this expenditure. 6. NHS Lothian is not able to hold reserves as such in its ledger. However, at the end of the financial year, £1.336m of funds were held by NHS Lothian on behalf of the IJB. These funds were transferred to Midlothian Council to support the social care position. Thus, although these are shown as expenditure, these funds are not expenditure and have therefore been removed. The charges (shown as expenditure above) made by Midlothian Council to the IJB are the net direct costs incurred in the delivery of social care services in Midlothian. The charges from NHS Lothian are based on the health budget setting model as agreed by the IJB. That is, charges for the core services (those services specifically for and delivered by the Midlothian partnership) are based on the net direct actual costs incurred in Midlothian. However, charges for hosted and set aside services (those services which are not generally managed by the Midlothian Health and Social Care Partnership and are delivered on a pan-Lothian basis) are based on the total actual costs for these services shared across four IJBs per the budget setting model. The IJB share of the total actual costs incurred in 2023/24 for hosted services is 10% and, generally, 10% of the Lothian element of the set aside budgets and the non-cash limited budgets. The chart below shows how the IJB has spent its funds in 2023/24 in the following areas – • Adult Social Care (note this includes funds from NHS Lothian which are used to support social care – this is laid out in note 6 to the annual accounts below) • Primary Care Services (GPs, GP prescribing, community opticians, community pharmacists and community dental services) • Other Community health services (local community hospitals, community nursing services, community allied health professionals and Midlothian’s share of pan- Lothian hosted services) • Acute Services (Midlothian Share of those Acute services that have been delegated to the IJB) Page 40 of 184
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19 Consideration of the 2024/25 financial position The IJB has developed a five year financial planning model. At its December meeting an indicative five year plan is produced, and this is then revised and used as part of the budget setting process for the next financial year. At its December 2023 meeting a five year plan was presented to the IJB which showed a significant financial challenge in 2024/25. This 2024/25 forecast was then revised over the next three months and series of workshops were held with the IJB to consider recovery actions that could be delivered in 2024/25 to bring the financial forecast back into balance. At its March 2024 meeting the IJB accepted the budget offers from both partners and set a balanced financial plan for 2024/25. This plan is based on the delivery of £10.1m of recovery actions in both health and social care. This overall financial pressure was driven by: • Recovery actions to bring the projected overspends in the operational services back to break-even. This is clear from the financial challenges in delivering a balanced financial position in 2023/24 as described above. • Further efficiency programmes to address future 2024/25 financial pressures driven by increasing demand and projected funding shortfalls. • The IJB had planned to support further development and planning work using its general reserve over the next 3 years. Given that the general reserves had to be utilised in their entirety, this plan now needed to be amended. Adult Social Care, 36.6% Primary Care, 26.3% Other Community, 24.9% Acute, 12.2% Spend in year Percentage Page 41 of 184
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20 The 2024/25 recovery actions can be split into four main elements, the values against each below being the forecast financial pressures – 1. Actions to manage the financial pressure with the IJB’s Set Aside budget (£1.2m). The IJB will work with NHS Lothian and the other IJB’s in the Lothian to jointly manage this pressure. 2. Actions to manage the financial pressures within the IJB’s health budgets (£3.3m). This will be delivered through improved financial management (£2.1m, the largest element of which being plans to manage the projected overspend in GP prescribing) and reviews of the community teams staffing and skill mix (£1.2m). 3. Actions to manage financial pressures with the IJB’s social care budgets (£5.2m) This will be delivered through improved financial management (£1.6m) and four major reviews – review of the provision of client transport, a recovery plan Newbyres Care Home, a review of the commissioning of care from external providers and a change to the mix of care being provided by HSP staff directly and through external provision (total £3.6m) 4. A review of the staffing proposals for the investment in additional planning and support which had been planned to be funded through the IJB’s general reserves (£0.4m) The IJB has asked the partners to provide monthly financial updates and will monitor the 2024/25 financial position closely. Additional efficiency programmes will be required if a break-even position is not being forecast. The IJB will continue to revise its current finance year financial plan with a view to delivering a further formal five year plan in December 2024. Key Risks, challenges and uncertainties The main financial pressures remain in line with those in the 2022/23 annual accounts: • A growing and ageing population Midlothian’s population is now the fastest growing in Scotland. Although, in theory, national funding models for both Local Authorities and the NHS are designed to reflect population growth these models are constrained by: • The total funding available, which has increased but not sufficiently to manage the pressures identified. • Where population numbers reduce this does not necessarily reduce the costs of delivering services and it is difficult to move funds round the system. In addition the average age of the Midlothian population is projected to increase. As people live longer inevitably their health and social care needs increase and this demographic pressure is a national challenge to all IJBs. Page 42 of 184
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21 • The lack of an available workforce Both health and social care services are experiencing a shortage of care professionals. The IJB has developed a workforce plan in collaboration with its partners but tackling this issue is also a challenge nationally. • The challenging national financial landscape In setting its 2024/25 budget the Scottish Government recognises a significant financial challenge ahead for all public services notwithstanding its ambition to protect health and social care services as much as it can. • National Care Service The Scottish Government is in the process of setting up a National Care Service (NCS) which will include many of the functions currently delegated to the IJB. The Bill setting up the national care services is currently at Stage 2 (where MSPs can propose changes to the Bill). It is not currently clear what the impact of the NCS will be on the IJB nor the timescales for any changes to take place. Conor McManus IJB Chair. Morag Barrow, Chief Officer. David King, Interim Chief Finance Officer. Page 43 of 184
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22 Statement of Responsibilities Responsibilities of the Integration Joint Board The Integration Joint Board is required to: • Make arrangements for the proper administration of its financial affairs and to secure that the proper officer of the board has responsibility for the administration of those affairs (section 95 of the Local Government (Scotland) Act 1973). In this authority, that officer is the chief finance officer. • Manage its affairs to secure economic, efficient, and effective use of resources and safeguard its assets. • Ensure the Annual Accounts are prepared in accordance with legislation (The Local Authority Accounts (Scotland) Regulations 2014), and so far, as is compatible with that legislation, in accordance with proper accounting practices (section 12 of the Local Government in Scotland Act 2003). • Approve the Annual Accounts. I confirm that these Annual Accounts were approved for signature at a meeting of the Audit & Risk Committee. Signed on behalf of Midlothian Integration Joint Board. Conor McManus, IJB Chair. Page 44 of 184
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23 Responsibilities of the Chief Finance Officer The chief finance officer is responsible for the preparation of the IJB’s Annual Accounts in accordance with proper practices as required by legislation and as set out in the CIPFA/LASAAC Code of Practice on Local Authority Accounting in the United Kingdom (the Accounting Code). In preparing the Annual Accounts, the chief finance officer has: - • Selected suitable accounting policies and then applied them consistently. • Made judgements and estimates that were reasonable and prudent. • Complied with legislation. • Complied with the local authority Code (in so far as it is compatible with legislation). The chief finance officer has also: - • Kept proper accounting records which were up to date. • Taken reasonable steps for the prevention and detection of fraud and other irregularities. I certify that the financial statements give a true and fair view of the financial position of the Midlothian Integration Joint Board as at 31 March 2024 and the transactions for the year then ended. David King, Interim Chief Finance Officer Page 45 of 184
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24 Remuneration Report Introduction This Remuneration Report is provided in accordance with the Local Authority Accounts (Scotland) Regulations 2014. It discloses information relating to the remuneration and pension benefits of specified IJB members and staff. The information in the tables below is subject to external audit. The other sections of this report will be reviewed by Audit Scotland and any apparent material inconsistencies with the audited financial statements will be considered as part of their audit report. Remuneration: Integration Joint Board Chair and Vice Chair The voting members of the IJB are appointed through nomination by Midlothian Council and NHS Lothian Board. Nomination of the IJB Chair and Vice Chair post holders alternates between a Councillor and a Health Board representative. The IJB does not provide any additional remuneration to the Chair, Vice Chair or any other board members relating to their role on the IJB. The IJB does not reimburse the relevant partner organisations for any voting board member costs borne by the partner. Neither the Chair nor the Vice Chair appointments had any taxable expenses paid by the IJB in 2022/23 (Previous Year: nil). The Chair of the IJB in 2023/24 was Councillor Connor McManus (who is an elected member of Midlothian Council), the Vice Chair being Val de Souza who is a non- executive member of the NHS Lothian Board. The IJB does not have responsibilities, either in the current year or in future years, for funding any pension entitlements of voting IJB members. Therefore, no pension rights disclosures are provided for the Chair or Vice Chair. NHS Lothian no longer automatically offers another full day’s remuneration for being the Board’s Lead Voting Member on an IJB. Instead, non-executive remuneration is based on an individual’s overall estimated time commitment, which can include multiple memberships of Board committees and IJBs as well as other responsibilities, not just as committee chairs or lead voting members of the IJBs. No specific remuneration is therefore available for the vice chair of the IJB in 2023/24 (previous year £9,030). Remuneration: Officers of the Integration Joint Board The IJB does not directly employ any staff; however specific post-holding officers are non- voting members of the Board. Chief Officer Under section 10 of the Public Bodies (Joint Working) (Scotland) Act 2014 a Chief Officer for the IJB has to be appointed and the employing partner has to formally second the officer to Page 46 of 184
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25 the IJB. The employment contract for the Chief Officer will adhere to the legislative and regulatory framework of the employing partner organisation. The remuneration terms of the Chief Officer’s employment are approved by the IJB. The Chief Officer of the IJB is Morag Barrow, who is also the Director of Health and Social Care for Midlothian Council and the Joint Director of the Midlothian Partnership. It has been agreed that 50% of her total remuneration is to be shown in the accounts of the IJB as her remuneration as the Chief Officer of the IJB. Chief Finance Officer Although the costs of the Chief Finance Officer are not included in the charges made to the IJB by either partner, given the S95 role of the Chief Finance Officer and in the interests of transparency, the remuneration of the Chief Finance Officer is included below. Claire Flanagan was Chief Finance Officer until 30th September 2023 and was employed by NHS Lothian and has three roles – the IJB’s Chief Finance Officer, the Chief Finance Officer of East Lothian IJB and an operational role in the NHS Lothian finance team as a Finance Business Partner. On that basis, one third of the total remuneration for Claire Flanagan between 1st April 2023 and 30th September 2024 is shown below. From 1st October 2023 until 31st March 2024, David King was appointed as Chief Finance Officer on an interim basis. He is employed by NHS Lothian. His role is that of Chief Finance Officer with Midlothian IJB and Chief Finance Officer of East Lothian IJB. On that basis, his costs between 1St October 2023 and 31st March 2024 have been split half between these two IJBs. Other Officers No other staff are appointed by the IJB under a similar legal regime. Other non-voting board members who meet the criteria for disclosure are included in the disclosures below. Senior Employees: Salary, Fees & Allowances: Name 2022/23 £ 2023/24 £ Morag Barrow £52,699 £55,822 Claire Flanagan (Note 1) £25,901 £15,038 David King (Note 2) £4,308 £10,272 Note 1: Chief Finance Officer (Claire Flanagan) returned from maternity leave in May 2022, while off her role was fulfilled on an interim basis by David King. Note 2: David King covered Claire Flanagan maternity leave (which ended in May 22 as above). David King is no longer an active member of the SPPA. In respect of officers’ pension benefits the statutory liability for any future contributions to be made rests with the relevant employing partner organisation. On this basis there is no pensions liability reflected on the IJB balance sheet for the Chief Officer or any other Officers. Page 47 of 184
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26 The IJB however has responsibility for funding the employer contributions for the current year in respect of the officer time spent on fulfilling the responsibilities of their role on the IJB. The following table shows the IJB’s funding during the year to support officers’ pension benefits. The tables also show the total value of accrued pension benefits which may include benefits earned in other employment positions and from each officer’s own contributions. In year Pension Contributions: Name For Year to 2023 £ For year to 2024 £ Claire Flanagan £5,873 £3,077 Morag Barrow £3,097 £0 Accrued Pension Benefits: Name Pension (as at 31 March 2023) £000’s Lump Sum (as at 31 March 2023) £000’s Pension (as at 31 March 2024) £000’s Lump Sum (as at 31 March 2024) £000’s Morag Barrow £9 £19 £0 £0 Claire Flanagan £21 £29 £22 £55 Disclosure by Pay Bands Pay band information is not separately provided as all staff pay information has been disclosed in the information above. Exit Packages The IJB did not support nor did it direct to be supported by its partners, any exit packages during 2023/24 (2022/23: nil). Conor McManus, IJB Chair. Morag Barrow, Chief Officer. Page 48 of 184
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27 Annual Governance Statement 2023/24 Introduction The Annual Governance Statement explains the IJB’s governance arrangements and system of internal control and reports on their effectiveness. Scope of Responsibility The IJB is responsible for ensuring that its business is conducted in accordance with the law and proper standards, and that public money is safeguarded and properly accounted for and used economically, efficiently and effectively. To meet this responsibility, the IJB has established arrangements for governance which includes a system of internal control. The system is intended to manage risk to support the achievement of the IJB’s policies, aims and objectives. Reliance is also placed on NHS Lothian and Midlothian Council’s (the partners) systems of internal control that support compliance with both organisations’ policies and promotes achievement of each organisation’s aims and objectives, as well as those of the IJB. The system can only provide reasonable and not absolute assurance of effectiveness. The Governance Framework and Internal Control System The Board of the IJB comprises voting members, nominated by either NHS Lothian or Midlothian Council, as well as non-voting members including a Chief Officer appointed by the Board. The current IJB Local Code of Corporate Governance (IJB Local Code), which was approved by the Board on 8 April 2021, sets out the framework and key principles, which require to be complied with, to demonstrate effective governance. The IJB Local Code reflects the changing context of integration and is consistent with the principles and recommendations of the CIPFA/SOLACE Framework ‘Delivering Good Governance in Local Government’ (2016) and the supporting guidance notes for Scottish authorities. The overall aim of the Framework is to ensure that: resources are directed in accordance with agreed policy and according to priorities; there is sound and inclusive decision making; and there is clear accountability for the use of those resources in order to achieve desired outcomes for service users and communities. The main features of the governance framework and internal control system associated with the seven core principles of good governance defined in the IJB Local Code in existence during 2023/24 included: A. Behaving with integrity, demonstrating strong commitment to ethical values, and respecting rule of law The roles and responsibilities of Board members and statutory officers and the processes to govern the conduct of the Board’s business are defined in the Scheme of Integration which Page 49 of 184
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28 was approved by the Board and NHS Lothian in June 2022, which serves as the approved constitution, and Standing Orders, a revision of which was approved by the Board in February 2023, to make sure that public business is conducted with fairness and integrity. The Ethical Standards in Public Life (Scotland) Act 2000 provides for Codes of Conduct for local authority councillors and members of relevant public bodies. As a Public Body listed in schedule 3 of the Act, the IJB is required to produce a Code of Conduct, which was approved by the Board in April 2022, continued adherence to this Code of Conduct provides appropriate assurance against this principle. The IJB is dependent upon arrangements within the partner organisations for areas such as: • ensuring legal compliance in the operation of services; • handling complaints; • ethical awareness training and whistleblowing policies and procedures; • staff appointment and appraisal processes which take account of values and ethical behaviour; • identifying, mitigating and recording conflicts of interest, hospitality and gifts; and • procurement of goods and services which are sustainable, represent value of money and which reinforce ethical values. Other areas where the IJB places significant reliance on arrangements in place within the partner organisations are set out in the remainder of the statement. The Chief Officer is responsible for ensuring that agreed procedures are followed and that all applicable statutes and regulations are complied with. Professional advice on the discharge of duties is provided to the Board by the IJB Chief Officer supported by Chief Financial Officer, Chief Internal Auditor and Board Clerk as appropriate. B. Ensuring openness and comprehensive stakeholder engagement Board meetings are held in public unless there are good reasons for not doing so on the grounds of confidentiality. Board papers are available to the public on the Council website. Unless confidential, decisions made by the Board are documented in the public domain. Community engagement was encouraged as part of the development of the Scheme of Integration and the Strategic Plans of the Health and Social Care Integration Joint Board were developed following consultations with interested parties including members of the public. C. Defining outcomes in terms of sustainable economic, social, and environmental benefits The vision, strategic objectives and outcomes are reflected in the Midlothian Health & Social Care Integration Joint Board third Strategic Plan 2022-25 was approved in April 2022 and has been updated to reflect on-going assessment of need and priorities following public Page 50 of 184
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29 consultation. Implementation is underpinned by the associated Directions, on which progress reports are presented to the Board. Implications are considered during the decision making process within the standard report template covering Policy, Equalities, Resources, Risk, and Involving People. D. Determining the interventions necessary to optimise the achievement of the intended outcomes In determining how services and other courses of action should be planned and delivered, the IJB has a statutory responsibility to involve patients and members of the public. The IJB Strategic Plan is based on consultation during its review and update. The IJB has issued Directions to the partners for service delivery and for service redesign and recommissioning in line with the transformation programme. E. Developing the entity’s capacity, including the capability of its leadership and the individuals within it The IJB Chief Officer is responsible and accountable to the Board for all aspects of management including promoting sound governance and providing quality information/support to inform decision-making and scrutiny. Regular meetings are held between the Chief Officer and the Chair and Vice Chair of the IJB. The IJB Chief Officer also meets regularly with representatives from the partner organisations. Members of the IJB Board are provided with the opportunity to attend Development Sessions relevant to their role as part of their development programme. The IJB has also undertaken a Self-Assessment Completed in August 2023 with an improvement plan being approved. A 3 year Workforce Plan 2022-25 has been created, approved and published to help ensure it has the right people, with the right skills, in the right place, at the right time to support the delivery of its strategic objectives and priorities. F. Managing risks & performance through robust internal control & strong public financial management The IJB Chief Officer has overall responsibility for directing and controlling the partnership to deliver health and social care services. The IJB Board is responsible for key decision- making. The IJB has approved a Risk Management Strategy which includes: the reporting structure; types of risks to be reported; risk management framework and process; roles and responsibilities; and monitoring risk management activity and performance. This Strategy has been updated and presented to the June 2024 Audit & Risk Committee. The IJB Chief Financial Officer is responsible for the proper administration of all aspects of the IJB’s financial affairs including ensuring advice is given to the Board on all financial matters. Page 51 of 184
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30 The IJB’s system of internal financial control is dependent upon the framework of financial regulations, regular management information (including Revenue Budget Monitoring reports to the Board), administrative procedures (including segregation of duties), management supervision and systems of delegation and accountability within the partner organisations. The IJB also relies upon the partners for: • Counter fraud and anti-corruption arrangements; and • Management of data in accordance with applicable legislation. G. Implementing good practices in transparency, reporting, and audit to deliver effective accountabil- ity The Shared Chief Internal Auditor of Midlothian Council is the IJB’s Chief Internal Auditor whose role is to provide an independent and objective annual opinion on the effectiveness of the IJB’s internal controls, risk management and governance. This is carried out in conformance with the Public Sector Internal Audit Standards. The IJB responds to the findings and recommendations of Internal Audit, External Audit, Scrutiny and Inspection bodies. The IJB Audit and Risk Committee is integral to overseeing assurance and monitoring improvements in internal controls, risk management and governance. The Audit & Risk Committee updated the terms of reference in June 2024 and have agreed to recruit an independent member in line with CIPFA best practice. Performance Reports were presented to the Board for monitoring and control of achievement of Local Improvement Goals. An Annual Performance Report for 2023/24 is being prepared to outline progress against strategic objectives over the year. The Annual Accounts and Report for 2023/24 will set out the financial position in accordance with relevant accounting regulations and is being prepared. Review of Adequacy and Effectiveness The IJB is required to conduct an annual review of the effectiveness of its governance framework. The review was informed by: an annual self-assessment carried out by Internal Audit against the IJB’s Local Code of Corporate Governance; Internal Audit reports for the IJB; External Audit reports for the IJB; relevant reports by other external scrutiny bodies and inspection agencies; and relevant partners’ (NHS Lothian and Midlothian Council) Internal Audit and External Audit reports. In respect of the three improvement areas of governance identified by the IJB in 2022/23, there have been developments during the year in all three of these areas. Specifically, the risk register has been developed to include an additional risk specific to the Boards financial challenge, the IJB Strategic Plan and the medium term financial plan continue to be further developed to include demonstrated the links more explicitly and this work remains ongoing, governance processes to manage the monitoring of financial recovery plans also remain ongoing. Page 52 of 184
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31 Improvement Areas of Governance The review activity outlined above has identified the following areas where further improvement in governance arrangements can be made to enhance compliance with the Local Code: 1 The Medium term financial plan should be further developed to include a more explicit link to the Midlothian IJB Strategic Plan. 2 Given the significant challenges in developing financial recovery plans of approximately £10million for 2024/25 confirmation of the governance process of monitoring against the achievement of these recovery plans should continue to be developed. 3 Improvements to the Midlothian publication scheme are required in order to ensure that the Register of Interests for Board Members, the Public Engagement Statement and financial information is accessible through the Midlothian IJB Publication scheme. The implementation of these actions to enhance the governance arrangements in 2024/25 will be driven and monitored by the IJB Chief Officer in order to inform the next annual review. Internal Audit work planned in 2024/25 is designed to test improvements and compliance in governance. Conclusion and Opinion on Assurance It is our opinion that reasonable assurance can be placed upon the adequacy and effectiveness of the IJB’s governance arrangements and system of internal control, while recognising that further improvements are required to fully demonstrate compliance with the Local Code in order for the IJB to fully meet its principal objectives. Systems are in place to regularly review and improve governance arrangements and the system of internal control. Conor McManus, Chair Morag Barrow, Chief Officer Page 53 of 184
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32 Independent Auditor’s Report Independent auditor’s report to the members of Midlothian Integration Joint Board and the Accounts Commission This will be provided after the independent auditors have completed their audit in August 2024. Page 54 of 184
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33 Comprehensive Income and Expenditure Statement This statement shows the cost of providing services for the year according to accepted accounting practices. Where the impact on the General Fund is amended by statutory adjustments, this is shown in both the Expenditure and Funding Analysis and the Movement in Reserves Statement. Integration Joint Board Comprehensive Income and Expenditure Statement Income/Expenditure 2022/23 2023/24 Net Ex- penditure Net Ex- penditure £000’s £000’s Health Care Services - NHS Lothian £122,663 £132,906 Social Care Services - Midlothian Council £60,522 £66,036 Cost of Services £183,185 £198,942 Taxation and Non-Specific Grant Income -£172,830 -£186,584 Surplus/(deficit) on Provision of Services -£10,355 -£12,358 The Integration scheme lays out that the partners will provide corporate and other support to the IJB as required and will not charge for these services. These costs are not, therefore, included above. Page 55 of 184
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34 Movement in Reserves Statement The movement in reserves statement shows the value of the IJBs reserve and how this has reduced during 2023/24. Movements in Reserves during 2023/24 IJB Reserves Earmarked Reserves £000's General Reserves £000's Total Reserves £000's Movements - 2023/24 Opening Balance - 31/3/2023 £6,975 £6,182 £13,157 Drawdown of Reserve in year (£6,176) (£6,182) (£12,358) Additions to Reserve in year £0 £0 £0 Closing Balance - 31/3/2024 £799 £0 £799 The comparative values for the previous year (2022/23) being – IJB Reserves Earmarked Re- serves £000's General Reserves £000's Total Reserves £000's Movements - 2022/23 Opening Balance - 31/3/2022 £17,642 £5,870 £23,512 Drawdown of Reserve in year (£10,667) £0 (£10,667) Additions to Reserve in year £0 £312 £312 Closing Balance - 31/3/2023 £6,975 £6,182 £13,157 Page 56 of 184
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35 Balance Sheet The Balance Sheet shows the value of the IJB’s assets and liabilities as at the balance sheet date. The net assets (assets less liabilities) of the IJB are matched by the reserves held by the IJB. Integration Joint Board Balance Sheet – Current Assets Net Current Assets 31 March 2023 £000’s 31 March 2024 £000’s Notes Debtors £13,157 £799 7 Creditors: amounts falling due within one year £0 £0 Total assets less current liabilities £13,157 £799 Integration Joint Board Balance Sheet – Capital and Reserves Net Liabilities 31 March 2023 £000’s 31 March 2024 £000’s Notes Earmarked Reserve £6,975 £799 1 General Reserve £6,182 £0 1 Total Reserves £13,157 £799 See note 7 in the Notes to the Financial Statements. See note 1 in the Notes to the Financial Statements IJB usable reserves The unaudited finance statements were issued on 28th June 2024 and the audited financial statements were approved and authorised for issue by the Interim Chief Finance Officer on 19th September 2024. David King, Interim Chief Finance Officer. Page 57 of 184
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36 Notes to the Financial Statements 1 Significant Accounting Policies General Principles The Financial Statements summarise the IJB’s transactions for the 2023/24 financial year and its position at the year-end of 31 March 2024. The IJB was established under the requirements of the Public Bodies (Joint Working) (Scotland) Act 2014 and is a Section 106 body as defined in the Local Government (Scotland) Act 1973. The Financial Statements are prepared in compliance with the Code of Practice on Local Authority Accounting in the United Kingdom 2023/24, supported by International Financial Reporting Standards (IFRS), unless legislation or statutory guidance requires different treatment. The accounts are prepared on a going concern basis, which assumes that the IJB will continue in operational existence for the foreseeable future. The historical cost convention has been adopted. Basis of Preparation The IJB financial statements for 2023/24 have been prepared on a going concern basis. The IJB was established under the requirements of the Public Bodies (Joint Working) (Scotland) Act 2014 and is a Section 106 body as defined in the Local Government (Scotland) Act 1973. In accordance with the CIPFA Code of Local Government Accounting (2023/24), the IJB is required to prepare its financial statements on a going concern basis unless informed by the relevant national body of the intention for dissolution without transfer of services or function to another entity. The accounts are prepared on the assumption that the IJB will continue in operational existence for the foreseeable future. The IJB’s funding from and commissioning of services to partners has been confirmed for 2023/24, and a medium-term financial plan has been prepared through to 2028. Given that the IJB is wholly funded by the partners and the IJB’s Integration Scheme commits the partners to funding any overspend within the IJB I consider that there are no material uncertainties around its going concern status. Accruals of Income and Expenditure Activity is accounted for in the year that it takes place, not simply when settlement in cash occurs. In particular: • Expenditure is recognised when goods or services are received, and their benefits are used by the IJB • Income is recognised when the IJB has a right to the income, for instance by meeting any terms and conditions required to earn the income, and receipt of the income is probable Page 58 of 184
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37 • Where income and expenditure have been recognised but settlement in cash has not taken place, a debtor or creditor is recorded in the Balance Sheet • Where debts may not be received, the balance of debtors is written down Funding The IJB is wholly funded through funding contributions from the statutory funding partners, Midlothian Council and NHS Lothian. Expenditure is incurred in the form of net charges by the partners to the IJB. Cash and Cash Equivalents The IJB does not operate a bank account or hold cash. Transactions are settled on behalf of the IJB by the funding partners. Consequently, the IJB does not present a ‘Cash and Cash Equivalent’ figure on the balance sheet. Debtors and Creditors The funding balance due to or from each funding partner as at 31 March is represented as a debtor or creditor on the IJB’s Balance Sheet. Where income and expenditure have been recognised but settlement in cash has not taken place, a debtor or creditor is recorded in the Balance Sheet. Employee Benefits The IJB does not directly employ staff. Staff are formally employed by the partners who retain the liability for pension benefits payable in the future. The IJB therefore does not present a Pensions Liability on its Balance Sheet. The IJB has a legal responsibility to appoint a Chief Officer. More details on the arrangements are provided in the Remuneration Report. Provisions, Contingent Liabilities and Contingent Assets Provisions are liabilities of uncertain timing or amount. A provision is recognised as a liability on the balance sheet when there is an obligation as at 31 March due to a past event; settlement of the obligation is probable; and a reliable estimate of the amount can be made. Recognition of a provision will result in expenditure being charged to the Comprehensive Income and Expenditure Statement and will normally be a charge to the General Fund. A contingent liability is a possible liability arising from events on or before 31 March, whose existence will only be confirmed by later events. A provision that cannot be reasonably estimated, or where settlement is not probable, is treated as a contingent liability. A contingent liability is not recognised in the IJB’s Balance Sheet but is disclosed in a note where it is material. A contingent asset is a possible asset arising from events on or before 31 March, whose existence will only be confirmed by later events. A contingent asset is not recognised in the IJB’s Balance Sheet but is disclosed in a note only if it is probable to arise and can be reliably measured. The IJB has none of the above. Page 59 of 184
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38 Reserves The IJB’s reserves are classified as either Usable or Unusable Reserves. The IJB’s only Usable Reserve is the General Fund. The balance of the General Fund as at 31 March shows the extent of resources which the IJB can use in later years to support service provision. As noted above, the IJB has reserves of £799,000 at 31 March 2024. Integration Joint Board’s useable reserve Reserves 2023/24 Closing Balance £000’s Embedding a gender informed effective response to domestic abuse Project £27 Carers Act £391 Primrose Lodge £286 Sexual Health £35 Learning Disability Checks £60 General Reserves £0 Total £799 Indemnity Insurance The IJB has indemnity insurance for costs relating primarily to potential claim liabilities regarding Board member and officer responsibilities. NHS Lothian and Midlothian Council have responsibility for claims in respect of the services that they are statutorily responsible for and that they provide. The IJB holds separate indemnity insurance through its membership of the Clinical Negligence and Other Risks Indemnity Scheme (CNORIS) scheme, the charge for this in 2023/24 was £3,000 (PY £3,000). Unlike NHS Boards, the IJB does not have any ‘shared risk’ exposure from participation in CNORIS. The IJB participation in the CNORIS scheme is therefore analogous to normal insurance arrangements. Known claims are assessed as to the value and probability of settlement. Where it is material the overall expected value of known claims taking probability of settlement into consideration is provided for in the IJB’s Balance Sheet. The likelihood of receipt of an insurance settlement to cover any claims is separately assessed and, where material, presented as either a debtor or disclosed as a contingent asset. There are no outstanding claims or any indications that any claims are to be made against the IJB. Page 60 of 184
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39 2 Critical Judgements and Estimation Uncertainty The critical judgements made in the Financial Statements relating to complex transactions are: • The partner organisations have considered their exposure to possible losses and made adequate provision where it is probable that an outflow of resources will be required, and the amount of the obligation can be measured reliably. Where it has not been possible to measure the obligation, or it is not probable in the partner organisations’ options that a transfer of economic benefits will be required, material contingent liabilities have been disclosed (there are none). • The Annual Accounts contains estimated figures that are based on assumptions made by the IJB about the future or that are otherwise uncertain. Estimates are made taking into account historical experience, current trends and other relevant factors. However, because balances cannot be determined with certainty, actual results could be materially different from the assumptions and estimates. • There are no items in the IJB’s Balance Sheet at 31 March 2024 for which there is a significant risk of material adjustment in the forthcoming financial year. Provisions The IJB has not created any provisions in respect of compensation claims. It is not certain that all claims have been identified or that the historic level of settlement payments is a reliable guide for future settlements. 3 Subsequent Events In accordance with the requirements of International Accounting Standards 10, events after the reporting period are considered up to the date on which the accounts are authorised for issue. This is interpreted as the date that the accounts were certified by the Chief Financial Officer following approval by the Audit and Risk Committee. Events after the Balance Sheet date are those events, both favourable and unfavourable, that occur between the end of the reporting period and the date when the Annual Accounts are authorised for issue. Two types of events can be identified. • Adjusting events: Those that provide evidence of conditions that existed at the end of the reporting period. The Annual Accounts is adjusted to reflect such events. • Non-adjusting events: Those that are indicative of conditions that arose after the reporting period and the Statements are not adjusted to reflect such events. Where a category of events would have a material effect, disclosure is made in the notes of the nature of the events and their estimated financial effect. Page 61 of 184
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40 4 Expenditure and Funding Analysis Income and Expenditure 2023/24 Services specifically for Midlothian 2022/23 2023/24 £000’s £000’s Health £72,439 £79,694 Social Care £60,522 £66,036 Midlothian’s share of Lothian Health Services (Hosted) £27,638 £28,884 Midlothian’s share of Lothian Health Services (Set Aside) £22,586 £24,328 Total £183,185 £198,942 Funded by: Midlothian Council £56,612 £57,416 Funded by: NHS Lothian £116,218 £129,168 Total Funding £172,830 £186,584 Surplus/(Deficit) (£10,355) (£12,358) Expenditure above has been split into three main areas: • Expenditure on those services delivered specifically for the population of Midlothian. These services are managed locally by the Midlothian Partnership – shown under Health and Social Care above. • Hosted Services – these are health services managed either by the Edinburgh, East Lothian and West Lothian Partnerships or managed by NHS Lothian on a pan-Lothian basis. These services included Mental Health Services, Learning Disability Services, Substance Misuse Services, Rehabilitation services, General Dental Services, General Pharmaceutical Services and General Ophthalmic Services. This is the IJB’s agreed share of these services. • Set Aside Services – these are services delivered in the main acute hospitals (Royal Infirmary of Edinburgh, Western General Hospital and St. John’s Hospital) and managed by NHS Lothian. This is the IJB’s agreed share of these services. 5 Corporate Service Included in the above costs are the following corporate services IJB Corporate Costs 2022/23 £000’s 2023/24 £000’s Staff (Chief Officer) £53 £56 CNORIS £3 £3 Audit Fee £32 £33 Total £88 £92 As noted above, the Chief Finance Officer is not charged to the IJB. Page 62 of 184
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41 6 Related Party Transactions As partners with the Integration Joint Board, both Midlothian Council and NHS Lothian are related parties and the material transactions with these bodies are disclosed in these accounts. There are elements of expenditure which are shown against the NHS Lothian above but where the resources are used by the social care services delivered by Midlothian Council. Transfers of resources between health and social care services Funding Partner/ Resources transferred 2022/23 2023/24 £000’s £000’s NHS Lothian £122,663 £132,906 Resource Transfer (£7,109) (£6,928) Social Care Fund (£4,816) (£4,816) Other Resources transferred (£389) Net NHS Lothian Expenditure £110,738 £120,773 Midlothian Council £56,612 £66,036 Resource Transfer £7,109 £6,928 Social Care Fund £4,816 £4,816 Other Resources Transferred £389 Gross Social Care Expenditure £72,447 £78,169 Both Resource Transfer and the Social Care Fund are resources which are part of the NHS Lothian budget, but these funds are used to deliver social care service supplied by Midlothian Council. As is noted above, the IJB is not charged for the costs of its Chief Finance Officer nor any fees paid to its Vice Chair. The costs of the IJB’s Chief Officer are disclosed in the remuneration report and included in the charges to the IJB in table 4 above. Table 4 above shows the contributions received from each of the IJB’s funding partners and the commissioning expenditure provided to each partner. Table 5 above shows the corporate costs incurred by the IJB, these are funded by the partners and included in the expenditure analysis above. Page 63 of 184
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42 7 Short Term Debtors Owed to the IJB at 31 March 2024 2022/23 2023/24 £000’s £000’s Funding due from NHS Lothian £5,454 £381 Funding due from Midlothian Council £7,703 £418 Total £13,157 £799 8 VAT The IJB is not VAT registered. The VAT treatment of expenditure in the IJB’s accounts depends on which of the Partner agencies is providing the service as these agencies are treated differently for VAT purposes. Where the Council is the provider, income and expenditure excluded any amounts related to VAT, as all VAT collected is payable to H.M. Revenue & Customs and all VAT paid is recoverable from it. The Council is not entitled to fully recover VAT paid on a very limited number of items of expenditure and for these items the cost of VAT paid is included within service expenditure to the extent that it is irrecoverable from H.M. Revenue and Customs. Where the NHS is the provider, expenditure incurred will include irrecoverable VAT as generally the NHS cannot recover VAT paid as input tax and will seek to recover its full cost as income from the Commissioning IJB. Page 64 of 184
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Midlothian Integration Joint Board Audit and Risk Committee Audit Scotland – Integration Joint Boards, Finance and Performance 2024. Thursday 12th September 2024 Item number: 5.5 Executive summary In 2022 and 2023 the Accounts Commission published a report setting out the financial position of the 31 Scottish Integration Joint Boards. In 2024 the accounts commission have now published a more broad report looking at not only the financial performance of the IJBs but also the performance against the national health and well being outcomes and a focus on the commissioning the procurement of social care. This document is attached as an appendix to this paper. The accounts commission report noted seven key messages and made five recommendations. The key messages are laid out below along with a consideration of Midlothian IJB’s position again the recommendations. This is an important report given the current financial and operational challenges in both health and social care and the plans that the Scottish Government has to remodel the IJB’s as part of the delivery of the National Care Service. Committee members are asked to: 1. Note this report. 2. Note the report of the Accounts Commission. 3. Consider the IJB’s position against the recommendations in the Accounts Commission report. 4. Request that a further report be made to a business meeting of the IJB. Page 65 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 2 Report 1. Purpose 1.1 This paper presents the Accounts Commission’s July 2024 report on Integration Joint Boards, finance and performance 2024. 2. Recommendations 2.1 Committee members are asked to • Note this report. • Note the report of the accounts commission. • Consider the IJB’s position against the recommendations in the Accounts Commission report. • Request that a further report be made to a business meeting of the IJB. 3. Background and main report 3.1 The In 2022 and 2023 the Accounts Commission published a report setting out the financial position of the 31 Scottish Integration Joint Boards. In 2024 the accounts commission have now published a more broad report looking at not only the financial performance of the IJBs but also the performance against the national health and well being outcomes and a focus on the commissioning the procurement of social care. This document is attached as an appendix to this paper. 3.2 This report made seven key recommendations. These are (verbatim) – 1 Integration Joint Boards (IJBs) face a complex landscape of unprecedented pressures, challenges and uncertainties. These are not easy to resolve and are worsening, despite a driven and committed workforce. The health inequality gap is widening, there is an increased demand for services and a growing level of unmet and more complex needs. There is also variability in how much choice and control people who use services feel they have, deepening challenges in sustaining the workforce, alongside increasing funding pressures. 2 We have not seen significant evidence of the shift in the balance of care from hospitals to the community intended by the creation of IJBs. They operate within complex governance systems that can make planning and decision making difficult. They cannot address the issues across the sector alone. Whole system collaborative working is needed as part of a clear national strategy for health and Page 66 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 3 social care that will promote improved outcomes across Scotland but reflects the need to respond to local priorities. 3 The workforce is under immense pressure reflecting the wider pressures in the health and social care system. Across the community health and social care sector there are difficulties in recruiting and retaining a skilled workforce. The Covid-19 pandemic, the cost-of-living crisis and the impact of the withdrawal from the European Union have deepened existing pressures. Unpaid carers are increasingly relied on as part of the system but are also disproportionately affected by the increased cost-of-living. Without significant changes in how services are Key messages provided and organised, these issues will get worse as demand continues to increase and the workforce pool continues to contract. 4 Uncertainty around the direction of the plans for a National Care Service and continued instability of leadership in IJBs have also contributed to the difficult context for planning and delivering effective services. We are seeing examples of IJBs trying to work in new and different ways, but there is a lack of collaboration and systematic shared learning on improvement activities. 5 The financial outlook for IJBs continues to weaken with indications of more challenging times ahead. • In common with other public sector bodies, financial pressures arising from rising inflation, pay uplifts and Covid19 legacy costs are making it difficult to sustain services at their current level and, collaborative, preventative and person-centred working is shrinking at a time when it is most needed. • The financial outlook makes it more important than ever that the budget process involves clear and open conversations with IJB partners, workforce, people who use services and other stakeholders around the difficult choices required to achieve financial sustainability. • Overall funding to IJBs in 2022/23 decreased by nine per cent in real terms or by one per cent in real terms once Covid-19 funding is excluded. The total reserves held by IJBs almost halved in 2022/23, largely due to the use and return of Covid-related reserves. The majority of IJBs reported notable savings, but these were largely arising on a non-recurring basis from unfilled vacancies. • IJBs have had to achieve savings as part of their partner funding allocations for several years. The projected funding gap for 2023/24 has almost tripled, in comparison to the previous year, with over a third anticipated to be bridged by non-recurring savings, with a quarter of the gap bridged using reserves. This is not a sustainable approach to balancing budgets. 6 Data quality and availability is insufficient to fully assess the performance of IJBs and inform how to improve outcomes for people who use services with a lack also of joined up data sharing. However, available national indicators show a general decline in performance and outcomes. 7 Current commissioning and procurement practices are driven largely by budgets, competition, and cost rather than outcomes for people. They are not Page 67 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 4 always delivering improved outcomes and are a risk for the sustainability of services. Improvement to commissioning and procurement arrangements has been slow to progress but is developing. There are some positive examples of where more ethical and collaborative commissioning models are being adopted. 3.3 In summary the key messages address – 1. The current challenging landscape in which IJB’s have to function. 2. Little movement in shifting the balance of care. 3. The Intense pressure which the (partners) health and social care workforce have to manage. 4. Uncertainty on the future role of IJB’s arising from the development of the National Care service. 5. Significant increase in the overall financial challenges. 6. Challenges around data and the quality of that data available to the IJBs. 7. The commission of care is being driven by budgets and not by outcomes. 3.3 The report makes five recommendations. The table below lays out the IJB’s position at this time. Page 68 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 5 Recommendation Midlothian Medium-term financial plans are up to date. The IJB has a Medium Term Financial Strategy. This is published every December with revisions made during the financial year. The most recent version being presented to the IJB at its August 2024 meeting Annual budgets and proposed savings are achievable and there has been consultation with all stakeholders. The IJB set a balanced budget for 2025/25 at its March 2024 meeting. This included a serious of challenging recovery schemes totalling £10.8m. These were developed by the IJB’s management and discussed and considered by the at a workshop in February 2024. The IJB has stepped up its financial in year financial monitoring with a detailed Quarter 1 review in August and a further finance workshop scheduled for September 2024. Work collaboratively with other IJBs to share learning and develop service redesign focused on early intervention and prevention and improving recruitment and retention of the workforce. As one of four IJBs within the NHS Lothian area there is strong collaboration between Chief Officers, Chief Finance Officers and Operational teams. The Health and Social Care Partnership (HSCP) engages and collaborates on pan Lothian primary care, mental health and unscheduled care strategic programmes. The HSCP professional leads and their teams work across Lothian on workforce issues, for example there is pan Lothian work ongoing focussed on District Nursing. Work collaboratively with other IJBs and partners to understand what data is available and how it can be developed and used to fully understand and improve outcomes for those using IJB commissioned services. As above, there is strong collaboration throughout the HSCP with the other HSCPs and the partner bodies with regards to performance information and how data can be improved and utilised to improve outcomes. Evaluate whether the local commissioning of care and support services, and the contracting of these services, adheres to the ethical commissioning and procurement principles, improving outcomes for people. As part of the financial recovery schemes laid out above a major review of the delivery of social care within Midlothian is underway. The HSCP are committed to ethical commissioning and procurement principles. Page 69 of 184
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Midlothian Integration Joint Board – Audit and Risk Committee Page 6 3.4 This is an important report given the current financial challenges across the pubic sector in Scotland and given the potential changes to the role and constitution of the IJB that may arise from the proposed amendments to the Nation Care Service Bill. 3.5 It is proposed that a further report on this Accounts Commission report be taken to a business meeting of the IJB where it can be considered further. 4. Policy Implications 4.1 There are no further policy implications arising from this report. 5. Equalities Implications 5.1 There are no equalities implications arising from this report 6. Resource Implications 6.1 There are no resource implications arising from this report. 7 Risks 7.1 The risks are described in the risk register which is attached 8 Involving People 8.1 There are no direct implications for involving people as a result of this report. 9 Background Papers 9.2 None AUTHOR’S NAME David King DESIGNATION Interim Chief Finance Officer CONTACT INFO david.king4@nhslothian.scot.nhs.uk DATE September 2024 Appendix 1 – Audit Scotland – Report July 2024. Integration Joint Boards, finance and performance 2024. Page 70 of 184
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Integration Joint Boards Finance and performance 2024 Prepared by Audit Scotland July 2024 Page 71 of 184
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2 Contents Key messages 3 Recommendations 6 1. Introduction 7 2. The context 11 3. Financial performance 15 4. Performance 26 5. Commissioning and procurement 42 Endnotes 48 Appendix 1 50 Appendix 2 58 Accessibility You can find out more and read this report using assistive technology on our website www.audit.scot/accessibility. Audit team The core audit team consisted of: Kathrine Sibbald, Zoe McGuire, Chris Lewis, Chris Dorrian and Philip Keane, under the direction of Carol Calder. Page 72 of 184
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3Key messages Key messages Key messages Key messages 1 Integration Joint Boards (IJBs) face a complex landscape of unprecedented pressures, challenges and uncertainties. These are not easy to resolve and are worsening, despite a driven and committed workforce. The health inequality gap is widening, there is an increased demand for services and a growing level of unmet and more complex needs. There is also variability in how much choice and control people who use services feel they have, deepening challenges in sustaining the workforce, alongside increasing funding pressures. 2 We have not seen significant evidence of the shift in the balance of care from hospitals to the community intended by the creation of IJBs. They operate within complex governance systems that can make planning and decision making difficult. They cannot address the issues across the sector alone. Whole- system collaborative working is needed as part of a clear national strategy for health and social care that will promote improved outcomes across Scotland but reflects the need to respond to local priorities. 3 The workforce is under immense pressure reflecting the wider pressures in the health and social care system. Across the community health and social care sector there are difficulties in recruiting and retaining a skilled workforce. The Covid- 19 pandemic, the cost-of-living crisis and the impact of the withdrawal from the European Union have deepened existing pressures. Unpaid carers are increasingly relied on as part of the system but are also disproportionately affected by the increased cost-of-living. Without significant changes in how services are Page 73 of 184
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4Key messagesKey messages provided and organised, these issues will get worse as demand continues to increase and the workforce pool continues to contract. 4 Uncertainty around the direction of the plans for a National Care Service and continued instability of leadership in IJBs have also contributed to the difficult context for planning and delivering effective services. We are seeing examples of IJBs trying to work in new and different ways, but there is a lack of collaboration and systematic shared learning on improvement activities. 5 The financial outlook for IJBs continues to weaken with indications of more challenging times ahead. • In common with other public sector bodies, financial pressures arising from rising inflation, pay uplifts and Covid- 19 legacy costs are making it difficult to sustain services at their current level and, collaborative, preventative and person-centred working is shrinking at a time when it is most needed. • The financial outlook makes it more important than ever that the budget process involves clear and open conversations with IJB partners, workforce, people who use services and other stakeholders around the difficult choices required to achieve financial sustainability. • Overall funding to IJBs in 2022/23 decreased by nine per cent in real terms or by one per cent in real terms once Covid-19 funding is excluded. The total reserves held by IJBs almost halved in 2022/23, largely due to the use and return of Covid-related reserves. The majority of IJBs reported notable savings, but these were largely arising on a non-recurring basis from unfilled vacancies. Page 74 of 184
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5Key messagesKey messages • IJBs have had to achieve savings as part of their partner funding allocations for several years. The projected funding gap for 2023/24 has almost tripled, in comparison to the previous year, with over a third anticipated to be bridged by non-recurring savings, with a quarter of the gap bridged using reserves. This is not a sustainable approach to balancing budgets. 6 Data quality and availability is insufficient to fully assess the performance of IJBs and inform how to improve outcomes for people who use services with a lack also of joined up data sharing. However, available national indicators show a general decline in performance and outcomes. 7 Current commissioning and procurement practices are driven largely by budgets, competition, and cost rather than outcomes for people. They are not always delivering improved outcomes and are a risk for the sustainability of services. Improvement to commissioning and procurement arrangements has been slow to progress but is developing. There are some positive examples of where more ethical and collaborative commissioning models are being adopted. Page 75 of 184
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6RecommendationsRecommendations Recommendations This report and the recommendations focus on IJBs, however to respond to the significant and complex challenges in primary and community health and social care all the bodies involved need to work collaboratively on addressing the issues – IJBs alone cannot address the crisis in the sector. The next iteration of this annual report will be produced jointly with the Auditor General for Scotland and will take a whole system approach and will make recommendations to the Scottish Government, councils, NHS boards as well as IJBs, as appropriate. Integration Joint Boards should: • ensure that their Medium-Term Financial Plans are up to date and reflect all current known and foreseeable costs to reflect short and longer-term financial sustainability challenges • ensure that the annual budgets and proposed savings are achievable and sustainable. The budget process should involve collaboration and clear conversations with IJB partners, workforce, people who use services and other stakeholders around the difficult choices required to achieve financial sustainability • work collaboratively with other IJBs and partners to systematically share learning to identify and develop: – service redesign focused on early intervention and prevention – approaches focused on improving the recruitment and retention of the workforce • work collaboratively with other IJBs and partners to understand what data is available and how it can be developed and used to fully understand and improve outcomes for those using IJB commissioned services. This should include a consideration of gaps in data. It should also include consideration of measures to understand the impact of preventative approaches • evaluate whether the local commissioning of care and support services, and the contracting of these services, adheres to the ethical commissioning and procurement principles, improving outcomes for people. Page 76 of 184
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71. Introduction 1. Introduction About this report 1. In 2022 and 2023 the Accounts Commission published a bulletin setting out the financial position of the 30 Scottish IJBs. This year’s report expands on this and provides a high-level independent analysis of IJBs, commenting on: • the financial performance of IJBs in 2022/23 and the financial outlook for IJBs in 2023/24 and beyond • performance against national health and wellbeing outcomes and targets alongside other publicly available performance information • a ‘spotlight’ focus on commissioning and procurement of social care. 2. This report focuses solely on IJBs. While it comments on how they interact and perform within the wider system, the work does not comment on the work of councils, NHS boards or the Scottish Government or make recommendations to these bodies. In future reports we will expand the scope to include these public bodies. This will allow us to consider community health and social care as a whole system and look at how different parts work together when planning and delivering services. 3. Supporting this report we have also published: • a supplement collating the performance information considered in the report • a checklist of questions, based on the issues raised in this report, for IJB board members to consider • a summary of the discussion at a stakeholders’ roundtable session we hosted in February 2024 that has helped inform this report. Page 77 of 184
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1. Introduction 8 What is an IJB? 4. An IJB is responsible for the governance, planning and resourcing of social care, primary and community healthcare and unscheduled hospital care for adults in its area. 5. The Public Bodies (Joint Working) (Scotland) Act 2014 (the Act) requires the 32 Scottish councils and 14 territorial NHS boards to work together in partnerships to integrate how social care and community healthcare services are provided. IJBs were created as part of the Act as separate legal bodies. Exhibit 1 (page 9) sets out how these IJBs operate. 6. There are 31 partnerships across Scotland. Stirling and Clackmannanshire councils have formed a single partnership with NHS Forth Valley. The majority of NHS boards have a partnership with more than one IJB and five IJBs cover the same geographical area as their health boards. 7. Highland follows a different arrangement, a Lead Agency model.1 This Accounts Commission report focuses on the work of the IJBs and does not comment on the performance of the Highland Health and Social Care Partnership as its scrutiny sits with the Auditor General for Scotland rather than the Accounts Commission. 8. The aim of integration is to ensure that people receive the care they need at the right time and in the right setting, with a focus on community-based, preventative care; improving the outcomes for patients, people who use services, carers and their families. The services are provided by a mixture of public, private and third sector providers dependent on who is most suitable to deliver those services. 9. The Act sets out which services are required to be delegated by councils and NHS boards to the IJBs as a minimum. This includes social care and primary and community healthcare. Services within this scope include for example, services for adults with physical disabilities, mental health services, drug and alcohol services and unscheduled health care. Some IJBs have also integrated other services. For example, 11 IJBs also have strategic responsibility for children’s social care services and 16 IJBs have strategic responsibility for criminal justice social work. Page 78 of 184
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1. Introduction 9 Exhibit 1. How IJBs work IJB • Responsible for planning health and care services • Has full power to decide how to use resources and deliver delegated services to improve quality and people’s outcomes Jointly accountable to: council and NHS board through its voting membership and reporting to the public Council • Delegates specific services to the IJB • Provides money and resources Accountable to: the electorate NHS board • Delegates specific services to the IJB • Provides money and resources Accountable to: Scottish ministers and the Scottish Parliament, and ultimately the electorate Service delivery • IJB directs the NHS board and council to deliver services • The extent of the IJB’s operational responsibility for delivering services is defined by the level of detail included in its directions to each partner. The more detailed its directions, the more it will monitor operational delivery. NHS board and council accountable to IJB for the delivery of services as directed IJB accountable for overseeing the delivery of services NHS board and council Level of operational responsibility IJB Source: What is integration? A short guide to the integration of health and social care services in Scotland, April 2018, Audit Scotland Page 79 of 184
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1. Introduction 10 10. Audit Scotland has published reports and is currently undertaking work, on behalf of the Accounts Commission and the Auditor General for Scotland, on some of these service areas. • Adult mental health Report published 13 September 2023. • Children and young people who need additional support for learning Blog published 17 May 2022. • Drug and alcohol services: An update Report published 8 March 2022 and Drug and alcohol services – audit scope Ongoing work to be published Autumn 2024. • Social care briefing Report published 27 January 2022. • General Medical Services contract progress Audit scope report to be published spring 2025. Page 80 of 184
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112. The context 2. The context IJBs face a complex landscape of considerable challenges and uncertainties 11. Social care and primary and community healthcare services in Scotland currently face complex and unprecedented pressures and challenges. These challenges are not easily resolved and are worsening. There is an increased demand for services, deepening challenges in sustaining the workforce, alongside increasing financial pressures. These longstanding challenges have been exacerbated by the cost-of-living crisis, increasing cost of provision of services and a changing policy landscape. The Covid-19 pandemic has also had a lasting impact on this sector, given the impact on health and social care staff and the need to continue to protect vulnerable people. 12. The Independent Review of Adult Social Care2 (Feeley Review) (published in February 2021), and the scrutiny of the National Care Service (Scotland) Bill has stimulated a lot of public debate and consideration of the need for change in the sector. But, to date there has been limited change for people experiencing or working in social care. It is important to emphasise that this is not a reflection on individuals working in the sector. Our experience, through this work, is that those involved, at all levels, are driven and passionate about improving the lives of people who need support. 13. IJBs cannot address the issues across the sector alone, whole- system collaborative working is needed as part of a clear national strategy. In the Auditor General for Scotland’s NHS in Scotland 2023 report, he stated that ‘there are a range of strategies, plans and policies in place for the future delivery of healthcare, but no overall vision. To shift from recovery to reform, the Scottish Government needs to lead on the development of a clear national strategy for health and social care. It should include investment in preventative measures and put patients at the centre of future services’. IJBs are facing significant financial sustainability challenges and cost pressures are only increasing 14. In common with other public sector bodies, financial pressures arising from rising inflation, pay uplifts, the cost-of-living crisis and Covid-19 legacy costs are making it difficult to sustain services at their current level. IJBs are also experiencing an increase in prescribing costs. IJBs have had to achieve savings as part of their partner funding allocations for several years and achieving these savings, while maintaining service levels, has become increasingly difficult. IJBs are now having to consider more significant options as statutory duties have to be prioritised. This Page 81 of 184
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2. The context 12 includes ending funding for some care and support services, to ensure financial sustainability in the medium to long term. The demand and need for services continue to increase and become more complex 15. Demographic changes and the increasing complexity of care needed are driving an increase in the demand for services. For example, an estimated one in 25 people of all ages in Scotland received social care support and services at some point during 2022/23. It is estimated that 76 per cent of these people are aged 65 and over, and 63 per cent are aged 75 and over.3 An estimated 20 per cent of Scotland’s population is aged over 65. In many rural and island areas this population group is even higher, for example 27 per cent of the population in Argyll and Bute and the Western Isles are over 65.4 16. The proportion of the population over the age of 65 is projected to grow by nearly a third by mid-2045. Since currently around three-quarters of people receiving social care support are aged 65 or over, this means that there will likely be a substantial rise in the number of people requiring social care support. It is likely this pattern reflects the challenges across most other services commissioned by IJBs. A recent study found that 93 per cent of people aged over 65 who received social care had two or more medical conditions simultaneously.5 People over 75 are around twice as likely to require outpatient or inpatient care compared to those aged in their mid-20s.6 The workforce is under immense pressure 17. Across the primary and community health and social care sector there are difficulties in recruiting and retaining a skilled workforce. Without significant changes in how services are provided and organised, this issue will get worse as demand continues to increase and the workforce pool continues to contract. The number of people aged 25-44 is predicted to fall from 1.4 million to 1.3 million by 2045. Meanwhile the number of people aged over 75 will rise from 469,000 in 2021 to 774,000 in 2045.7 18. We have previously highlighted how the effects of the pandemic worsened existing pressures on the social care workforce causing experienced staff to leave their posts. Our ongoing monitoring and discussions with stakeholders show that these issues remain and the cost-of-living crisis and the ongoing impact of withdrawal from the European Union have added to the pressures. 19. The staff vacancy rates across social care and support services in Scotland is high. At 31 December 2022, 49 per cent of services reported vacancies; 63 per cent of these services with vacancies reported problems filling them. The percentage of care services reporting vacancies had been consistent over time up to and including 2020, before a large increase of 11 percentage points reported in 2021.8 Page 82 of 184
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2. The context 13 20. Almost 90 per cent of social care providers stated recruitment and retention was problematic for them in a survey carried out by Scottish Care.9 This survey also found that a quarter of staff leave an organisation within the first three months of joining. Providers find they are competing for staff: • across other public, independent and third sector providers with differences in pay and terms and conditions • with the hospitality and retail sectors, who pay more for less demanding roles • with the health sector with an increasing disparity between health sector and social care sector wages – the current pay gap is 19 per cent between adult social care workers and NHS entry level pay. The cost-of-living crisis is affecting the demand for services as well as the ability to provide them 21. The increased costs of living have exacerbated the workforce challenges as the low wages are making it a less favourable career choice. This is particularly an issue for those providing care at home services who are experiencing an increase in petrol costs and are not always reimbursed in a timely manner, or, in some cases, at all for all their journeys. 22. Unpaid carers are also disproportionately affected by the increased cost-of-living crisis. People in the most deprived areas are more likely to provide 50 or more hours of unpaid care a week compared to people living in the least deprived areas.10 23. The cost of provision of services has also increased. Homecare costs per hour have increased by 19 per cent between 2016/17 and 2022/23. Residential care costs per week (for those aged 65 and over) have increased by 23 per cent between 2016/17 and 2022/23. There are also significant cost differences between urban and rural areas.11 24. In particular, for smaller, independent and third sector service providers, increased costs are causing problems for the sustainability of services. For example, in residential care homes, an increase in fuel costs to heat and provide power for residents has made their financial viability increasingly challenging. IJBs operate within complex governance systems that can make planning and decision making difficult 25. We previously reported in our Health and social care integration: update of progress report, that the current model of governance is complicated, with decisions made at IJB, council and health board level. We found that cultural differences between partner organisations are a barrier to achieving collaborative working and achieving key priorities. These challenges have not been resolved. An unpaid carer is anyone who cares for someone who is ill, disabled, older, has mental health concerns or is experiencing addiction and is not paid by a company or council to do this. Primarily, this is a family member or friend. Page 83 of 184
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2. The context 14 Instability of leadership continues to be a challenge for IJBs 26. A notable turnover of senior leadership positions since the start of health and social care integration continues to be a concern. Half of all IJBs experienced turnover in either their chief officer and/or chief finance officer posts in the last two years. Across 2021/22 and 2022/23, seven Chief Officers, 11 Chief Financial Officers, one IJB chair and one chief social work officer changed. Instability in leadership teams has the potential to disrupt strategic planning at a time when difficult and significant decisions need to be made. It can affect the culture of an organisation at a time when the workforce is under pressure. Plans for a National Care Service have brought uncertainty for IJBs 27. In June 2022, the Scottish Government introduced the National Care Service (Scotland) Bill to Scottish Parliament. The Bill was intended to ensure: • consistent delivery of high-quality social care support to every single person who needs it across Scotland, including better support for unpaid carers • that care workers are respected and valued. 28. The main elements of the Bill were the proposed creation of a National Care Service, including a national board, making Scottish Ministers accountable for social work and social care support. The original Bill also set out to transfer social care and social work council functions, staff and assets to Scottish Ministers or local care boards. This put in question the role and responsibility of IJBs and caused uncertainty for IJBs on the timescales for implementing the proposed National Care Service and what form it would likely take. This has complicated IJBs ability to undertake medium- and long-term financial planning. 29. After some delays, Stage 1 of the Bill was passed in March 2024. Amendments planned for the NCS Bill now mean IJBs will be reformed rather than replaced by 2029/30. IJBs should therefore ensure they have effective medium- and longer-term planning in place and continue to drive improvements in how they commission and deliver services. Page 84 of 184
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153. Financial performance 3. Financial performance The financial health of IJBs continues to weaken and there are indications of more challenging times ahead IJB funding has decreased in real terms compared to 2021/22 30. IJBs receive their funding as annually agreed contributions from their council and NHS board partners. Funding is largely received to cover in-year expenditure on providing services but can also be received for specific services and national initiatives to be funded in future years. 31. Funding to IJBs in 2022/23 decreased by £1.1 billion (nine per cent) in real terms to £11.0 billion; a £342 million decrease in cash terms Exhibit 2. IJBs received £1.0 billion of additional funding in 2021/22 to support their response to the Covid-19 pandemic. Excluding the 2021/22 Covid-19 related funding, this shows an underlying decrease of £68 million in real terms, representing a 1.0 per cent decrease. Exhibit 2. Real terms movement in IJB funding Partner funding (real terms) Covid-19 funding (real terms) 2022/232021/222020/21 £553m £10,987m £1,024m £11,025m £10,957m Source: IJB audited annual accounts 2020/21, 2021/22 and 2022/23 and ONS deflators Page 85 of 184
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3. Financial performance 16 Non-recurring savings, largely arising from unfilled vacancies, led to the majority of IJBs reporting a surplus on the cost of providing services 32. Nineteen IJBs reported a surplus on the cost of providing services, but these underspends were driven largely by vacancies and staff turnover (Exhibit 3, page 17). Three IJBs reported a break-even position and the remaining eight IJBs recorded an overspend of two per cent, or under, of their net cost of services. The three IJBs reporting a break-even position did so after receiving additional funding allocations from their partner bodies. The net underspend position on the costs of providing services across IJBs was £110 million. 33. The IJBs ability to meet the rising demand for their services and maintain service quality, is weakened by unfilled vacancies. The IJBs reporting a surplus would be unlikely to do so if the workforce was at full capacity. The majority of the total planned savings were achieved, but over a third were achieved only on a one-off basis 34. IJBs achieved 84 per cent of their £77 million planned savings target in 2022/23. Over a third of this was achieved on a non-recurring basis. This means that these savings will be carried forward to be found again in future years. Identifying and achieving savings every year on a recurring basis, and moving away from relying on one-off savings, is essential for IJBs to maintain financial sustainability. Total reserves held by IJBs have almost halved in 2022/23 due largely to the use or return of Covid-19 related reserves 35. By the end of 2022/23, all IJBs reported a reduction in their total level of reserves, decreasing by £560 million to £702 million, a 44 per cent reduction. 36. The decrease in the overall reserves balance was largely the result of a reduction in the reserves of funding that the Scottish Government specifically provided for the response to the Covid-19 pandemic. The Covid-19 related reserves decreased by 97 per cent, from £502 million to £14 million. Auditors confirmed that over two-thirds (£333 million) of the Covid-19 reserve reduction was a result of unused balances being returned to the Scottish Government. Page 86 of 184
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3. Financial performance 17 Exhibit 3. Operational surplus as a proportion of net cost of service -3 -2 -1 0 1 2 3 4 5 6 7 Shetland Aberdeenshire Scottish Borders Aberdeen Midlothian West Lothian Glasgow West Dunbartonshire Orkney Dumfries & Galloway Edinburgh East Lothian East Renfrewshire Clackmannanshire & Stirling Renfrewshire North Ayrshire Fife Inverclyde Falkirk Perth & Kinross South Lanarkshire East Dunbartonshire Dundee East Ayrshire Argyll & Bute Moray Angus North Lanarkshire South Ayrshire Eilean Siar Percentage Source: IJB audited annual accounts 2022/23 Page 87 of 184
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3. Financial performance 18 37. The exceptional impact of Covid-19 reserve movements can obscure underlying reserve movements. When Covid-19 reserve movements are excluded, the total value of reserves was reduced by 10 per cent (£72 million) from £760 million to £687 million. 38. IJBs hold reserves for a variety of reasons, including reserves held to address specific local or national policy initiatives or to mitigate the financial impact of unforeseen circumstances. The reserves held by IJBs consisted largely of four main areas (Exhibit 4, page 19), as follows: • Earmarked reserves of £426 million (£426 million in 2021/22) held by individual IJBs for a range of local planned purposes, such as reserves for multidisciplinary teams, interim care beds, as well as more generic reserves associated with winter planning and local reserves to support newer innovative practices that contribute towards strategic change. • Ring-fenced reserves of £79 million (£185 million in 2021/22) provided to support Scottish Government national policy objectives. Examples include the Primary Care Improvement Fund, Mental Health Recovery and Renewal, Mental Health Action 15, Community Living Change Fund and Alcohol and Drug Partnership funding. • Contingency reserves of £183 million (£148 million in 2021/22) that have not been earmarked for a specific purpose. IJBs have more flexibility on the use of this type of reserves which are often used to mitigate the financial impact of unforeseen circumstances. • Covid-19 related reserves of £14 million (£502 million in 2021/22), representing all unspent funding received to support the impact of the pandemic on IJB services. Page 88 of 184
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3. Financial performance 19 Exhibit 4. 2022/23 Reserves 61% Earmarked reserves 26% Contingency reserves 11% Ringfenced reserves 2% Covid-19 reserves Source: IJB audited annual accounts 2022/23 39. Reserves ring-fenced to support Scottish Government national policy objectives saw a 57 per cent reduction of £106 million to £79 million. These national initiatives include programmes for primary care improvement and mental health programmes. 40. These reserve balances largely represent non-recurring amounts of money that can only be used for specific and defined national policy priorities. As these non-recurring reserves are utilised, funding will need to be identified to fund any continuing associated initiatives on a sustainable basis. 41. The reduction in reserves was slightly offset by increases in the contingency reserves and other locally earmarked reserves. Contingency reserves have continued to increase, largely as a result of unplanned vacancy savings, and now represent a quarter of the total year end reserves balance. Page 89 of 184
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3. Financial performance 20 Exhibit 5. Year end IJB reserves as a proportion of net cost of services 0 2 4 6 8 10 12 14 16 Shetland Edinburgh Moray Dumfries & Galloway East Renfrewshire West Lothian Scottish Borders Orkney Aberdeenshire East Lothian Argyll & Bute Glasgow Fife North Ayrshire South Lanarkshire Perth & Kinross Aberdeen East Ayrshire Midlothian South Ayrshire Dundee Clackmannanshire & Stirling East Dunbartonshire Renfrewshire Falkirk Angus West Dunbartonshire Inverclyde North Lanarkshire Eilean Siar Percentage Contingency as a proportion of net cost of service Ringfenced/ earmarked reserves as a proportion of net costs of services Source: IJB audited annual accounts 2022/23 Page 90 of 184
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3. Financial performance 21 42. Contingency reserves are uncommitted funds held by IJBs to mitigate the financial impact of unforeseen circumstances and the amount held will vary depending on individual IJB reserve policies. A review of a sample of ten IJB reserve policies showed that the majority (eight) had a contingency reserve target of two per cent of annually budgeted expenditure. There is no statutory maximum or minimum level of contingency reserves. 43. Seventeen IJBs reported an increase in their contingency reserves leading to a net increase of 24 per cent (£35 million) to £183 million between 2021/22 and 2022/23. Across the IJBs, contingency reserves, as a proportion of the net cost of services, ranged from zero per cent to four per cent (Exhibit 5, page 20). Two thirds of IJBs had contingency reserve levels of over two per cent of the net cost of services. Five IJBs had no contingency reserves. The projected financial position is set to worsen 44. Twenty five IJBs agreed their 2023/24 budget before the start of the financial year. Delays in the agreement of savings plans and uncertainty around NHS partner funding were the most common reasons for IJBs not agreeing a balanced budgets before the start of the financial year. 45. IJBs do not always receive notification of funding allocations from NHS boards before the start of the financial year. This adversely affects the IJBs’ ability to plan expenditure, can cause delays to decision-making and lead to vacancies being held unfilled due to uncertainty over funding. 46. The projected funding gap for 2023/24 has almost tripled in comparison to the previous year. All IJBs reported an increase in their projected funding gap with the exception of Orkney IJB. The 2023/24 projected funding gap was £357 million representing a 187 per cent increase from the 2022/23 projected funding gap (£124 million). Funding gaps, as a proportion of the 2022/23 net cost of services, ranged from one to ten per cent (Exhibit 6, page 22). Page 91 of 184
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3. Financial performance 22 Exhibit 6. Funding gap as a proportion of net cost of service 0 2 4 6 8 10 Inverclyde South Ayrshire Dundee East Dunbartonshire Orkney North Ayrshire Aberdeenshire Angus North Lanarkshire East Ayrshire Shetland Aberdeen West Lothian Clackmannanshire & Stirling Glasgow Renfrewshire West Dunbartonshire East Lothian Fife South Lanarkshire Argyll & Bute Moray Midlothian East Renfrewshire Perth & Kinross Falkirk Edinburgh Scottish Borders Eilean Siar Dumfries & Galloway 2023/24 funding gap as proportion of net cost of service 2022/23 funding gap as proportion of net cost of services Percentage Source: Auditor data return Page 92 of 184
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3. Financial performance 23 47. Of the total funding gap, 53 per cent (57 per cent in 2021/22) is anticipated to be met by identified savings, 24 per cent from the use of reserves, with actions yet to be identified to bridge the remaining gap Exhibit 7. Exhibit 7. 2023/24 IJB funding gap planned action 43% Agreed savings - recurring 24% Use of reserves 16% Unidentified savings (includes savings for which no detailed or agreed plans are in place) 11% Agreed savings - non- recurring 6% Other Source: Auditor data return Page 93 of 184
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3. Financial performance 24 The increasing reliance on non-recurring sources of income is not sustainable 48. At the time of the 2023/24 budget setting, over a third of the projected funding gap was anticipated to be bridged by one-off sources of funding, ie on a non-recurring basis. A quarter of the projected funding gap was planned to be bridged by the use of non-recurring reserves and a further fifth of the identified savings were anticipated to be non- recurring. 49. In addition, a significant proportion of the funding gap did not have planned savings action agreed against it at the time of budget setting. These unidentified savings made up 16 per cent of the total projected funding gap and were the result of eight IJBs not starting the 2023/24 financial year with a balanced budget. 50. The increased reliance on non-recurring sources of income to fund recurring budget pressures is unsustainable in the medium to long term. The identification and delivery of recurring savings and a reduced reliance on drawing from reserves to fund revenue expenditure will be key to ensuring long-term financial sustainability. Financial sustainability risks have been identified by auditors in the vast majority of IJBs 51. Auditors identified financial sustainability risks for 80 per cent of IJBs as part of their 2022/23 audits. Findings suggested that there was a reliance on non-recurring savings and sources of income to achieve financial balance. 52. As recurring savings get more difficult to identify and achieve, the need for a more significant transformation of services, in order to achieve financial sustainability, becomes more important. 53. IJBs are currently facing a range of significant and growing challenges and uncertainties impacting financial sustainability and service provision, including: • uncertainty around the level and terms of future funding settlements and funding allocations for specific initiatives • significant recruitment and retention challenges, both with the IJB and partner bodies and with external providers in the sector • rising demand and increasing complexity of care arising from the demographic challenges of an ageing population • cost-of-living crisis and inflationary cost pressures, including prescribing costs, making it more expensive to maintain the same level of services Page 94 of 184
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3. Financial performance 25 • ongoing legacy cost impacts of Covid-19, including vaccination programmes, testing and Personal Protective Equipment costs. 54. An initial analysis of 2024/25 budget setting reveals that the projected funding gap for IJBs has increased again to £456 million. This increase underlines the importance of IJB board members having clear and frank conversations not only at the board level, but with partners, providers and the wider public, about the decisions that will be required to achieve future savings and the likely implication these decisions will have on the services individuals currently receive. Medium-Term Financial Plans need to be updated to reflect all cost pressures currently known 55. The majority of IJBs have an up to date Medium-Term Financial Plan in place, but auditors found a third needed to update their plan. It is essential that IJBs ensure Medium-Term Financial Plans are updated, reflecting all known and foreseeable costs, to allow informed decision- making on the delivery of sustainable service provision and reform in the future. Page 95 of 184
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264. Performance 4. Performance Data quality and availability is insufficient to fully assess the performance of IJBs, but national indicators show a general decline in performance and outcomes Data quality and availability is insufficient to fully assess the performance of IJBs and inform actions to improve outcomes for service users with a lack of joint data across the system 56. The Public Bodies (Joint Working) (Scotland) Act 2014 sets out nine National Health and Wellbeing Outcomes. These seek to measure the impact that integration is having on people’s lives. These national outcomes are underpinned by 23 associated national indicators, although four indicators have not been finalised for reporting. These national indicators have been developed from national data sources to provide consistency in measurement. IJBs are also encouraged to devise their own performance indicators for their area. Each IJB produces an annual performance report which sets out publicly its performance against key performance indicators. 57. Our review of IJB annual performance reports for 2022/23 shows the majority report against the key national performance indicators. All set out performance against their own identified strategic priorities. Some IJBs have developed their own indicators, as suggested in the Act, to help demonstrate how they are working towards their strategic outcomes. This allows for flexibility in reporting on local performance but means that describing a comprehensive national picture of performance is not possible. 58. Published performance information is not always clearly linked to the National Health and Wellbeing Outcomes with some gaps in the completeness of national performance information. Nine of the national integration performance indicators are based on the biennial Health and Care Experience Survey (HACE). Response rates for the HACE are generally quite low, with more deprived areas experiencing the lowest response rates. This increases the risk that there may be underrepresentation of the experience of certain groups of people and areas. The IJB Performance Supplement to this report sets out the performance of each IJB against the 19 national indicators available under the National Health and Wellbeing Outcomes. Page 96 of 184
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4. Performance 27 59. In our engagement with stakeholders, we heard a consistent message that data is key to a whole system approach and performance management needs to be redefined to reflect this. They indicated a range of challenges around data that is currently collected: • The current data does not provide good evidence on how the performance of one part of the system impacts on either other parts of the social care system or the system as a whole. This means the current performance data is of limited use in helping to inform system changes which might improve performance and deliver better long-term outcomes. • There is too much emphasis on data that is used by individual organisations for their governance and operational purposes rather than the collective partnership focus on its priorities. Current arrangements do not reflect a ‘whole-systems’ approach to performance management and reporting. • A lack of good data on primary care as it is voluntary for GP’s to report. • Data is more routinely collected and published on health services than social care services. Work to improve the data sets is at an early stage but is progressing 60. Work is being carried out by the Scottish Government and Public Health Scotland to improve data and allow the comparison of performance including the development of the Care & Wellbeing dashboard. This was launched in November 2023 and is populated with management information and updated on a weekly basis. IJB chairs and chief officers have access to the system to monitor significant shifts in performance and anomalies in the data. The system is still in its early stages of development and use. 61. There are other resources that can be utilised to assist in the analysis of data. In our Health and social care integration: update of progress 2018 report we set out the existence of Local Intelligence Support Team (LIST) analysts. Using a LIST analyst to tailor and interpret local data helps IJBs to better understand local need and demand and to plan and target services. 62. There are also examples of individual IJBs starting to manage their data in more innovative ways, for example at Midlothian IJB. (Case study 1, page 28) Page 97 of 184
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4. Performance 28 Case study 1. Midlothian IJB outcome mapping Midlothian IJB coordinates health and social care support to nearly 97,000 people. To better understand how the IJB contributes to personal outcomes for people, it asked all Midlothian HSCP services to track their contribution to improving outcomes using an outcome mapping approach by January 2024. Outcome mapping is a way to understand how services contribute to people achieving the outcomes that matter to them and can help services make more targeted, locally informed decisions about how to design, deliver or commission services. This approach allows them to describe what they do, who with, what people learn and gain as a result, how this makes them feel and the difference this makes in their lives. The outcome mapping approach was developed by ‘a Scottish software and consultancy company in partnership with the Midlothian HSCP Planning and Performance team. Each ‘stepping-stone’ of the outcome map framework includes a set of success criteria aligned to the Care Inspectorate joint inspection framework. The outcome map is colour-coded to show an evaluation of the extent to which the service is making progress towards personal outcomes and confidence in how strong the evidence is to support that progress rating. This results in a two-factor rating system for each ‘stepping-stone’ in the outcome map. The IJB also uses outcome mapping and has developed a Strategic Commissioning Map that provides a real-time picture of the whole system progress towards their strategic aims and the nine National Health and Wellbeing Outcomes by linking to service outcome maps. Outcome mapping is now central to performance measurement in the planning and performance teams. It is part of the triangulation of three types of data: service activity, population experience, and personal outcomes. The information collected from each of these three areas together provides objective, whole system evidence that supports services to develop meaningful action plans for change. Currently 60 per cent of service areas are using the framework. Some services are using this system to articulate, record, examine, and evaluate service provision and actively using this tool to support service redesign. Resourcing pressures continue to present challenges for some areas to find the time and space to complete a first map and a programme of targeted support is in place to help those areas with the most significant delivery pressures. The partnership has shared this work with Healthcare Improvement Scotland (HIS), the Scottish Government team developing the National Improvement Framework for Adult Social Care and Community Health and most recently the team developing a new improvement framework for health that will support person centred care. Source: Midlothian HSCP Page 98 of 184
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4. Performance 29 Available national indicators show a general decline in performance and outcomes for people using social care and primary and community healthcare services 63. As set out in the thematic sections below (and in the performance information supplement) there is a general decline in performance against the national indicators. 64. The following sections draw out performance findings against key themes set out in the bullet points below. Alongside nationally available data, for each theme we also describe the context and challenges. Some case studies of examples are also set out in Appendix 1 (page 50). These illustrate examples of where IJBs are using or developing different working practice to improve performance and outcomes. • Theme 1 – Prevention and early intervention • Theme 2 – Shifting the balance of care • Theme 3 – Person-centred care/choice and control • Theme 4 – Reducing inequalities • Theme 5 – Unpaid carers/community resilience. Theme 1 Indicators – Prevention and early intervention Collaborative, preventative and person-centred working is shrinking at a time when it is most needed. Instead of a focus on care at the right place at the right time, there is a shift to reactive services with little capacity to invest in early intervention and prevention. 65. Addressing individuals’ health and social care needs at an earlier stage through prevention and early intervention promotes better outcomes for individuals, improving their quality of life and independence, and reduces the need for costly support and care later on. The 2021 Independent Review of Adult Social Care in Scotland (Feeley Review) set out the need for an increased focus on preventative, early intervention and anticipatory forms of support and a shift away from a crisis intervention. However, this is difficult to progress when the pressures on services are so acute. 66. As financial pressures have increased, eligibility criteria for individuals accessing social care services have tightened. With this, opportunities to undertake prevention and early intervention focused services have decreased. IJBs and their partner bodies have instead signposted less formalised support in the community, often provided by third and voluntary sector organisations. However, we have found that the financial challenges are leading IJBs and other funding bodies such as NHS boards and councils to reduce grant funding to these service providers reducing the capacity to meet and address these lower level, often more preventative focused needs. Page 99 of 184
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4. Performance 30 67. Leaving lower-level health and social care needs unaddressed until they become more significant tends to lead to increased complexity of need, the requirement for a more resource intensive intervention and less positive outcomes for individuals in the longer term. It is essential that IJBs and their partner bodies find ways to protect and increase the health and social care interventions at an earlier stage. This will be key to addressing future demand pressures arising from demographic shifts to an older population in a more financially sustainable manner. 68. How well individuals consider themselves able to look after their health is indicative of the IJBs’ and partner bodies’ effectiveness in addressing and supporting individual needs to sustain healthy lives in the community. Since 2013/14, there has been a deterioration by four percentage points of adults who are able to look after their health either ‘very well’ or ‘quite well’ Exhibit 8. All the IJBs recorded a reduction in this measure over the period 2013/14 to 2022/23. Fourteen IJBs saw a reduction greater than average over this period, with three IJBs recording a reduction greater than five percentage points. Exhibit 8. Theme 1 indicators Percentage of adults able to look after their health very well or quite well 60 70 80 90 100 2023/242021/222019/202017/182015/16 95% 91% -4% Source: Core Suite of Integration Indicators, Public Health Scotland Page 100 of 184
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4. Performance 31 Exhibit 9. Theme 1 indicators Emergency admission rate (per 100,000 population) 8 9 10 11 12 13 2022/23 2021/22 2020/21 2019/20 2018/19 2017/18 2016/17 12,229 11,276 -8% Emergency bed day rate (per 100,000 population) 90 100 110 120 130 140 2022/23 2021/22 2020/21 2019/20 2018/19 2017/18 2016/17 125,979 119,806 -5% Source: Core Suite of Integration Indicators, Public Health Scotland 69. Emergency admissions rate and the emergency bed day rate are often used as indicators of how well IJBs are reducing unnecessary hospital stays and situations where individuals remain in hospital while they are deemed to be fit enough to return to a more community-based setting. 70. Positively, there has been an eight per cent reduction in the emergency admissions rate as well as a five per cent reduction in the emergency bed day rate since 2016/17. Compared to 2020/21 there is an 16 per cent increase in the emergency bed day rate, however this reflects the impact of the Covid-19 pandemic Exhibit 9. 71. Eighteen IJBs recorded a reduction in emergency bed day rate over the period 2016/17 to 2022/23 Exhibit 9. Of the twelve that recorded an increase, two IJBs record an increase of over 10 per cent. 72. Some IJBs have put in place schemes and plans and maintain early intervention and prevention services. For example, Aberdeen City have set up a listening service to offer first-level support for people with low- level mental health challenges, addressing issues such as bereavement, redundancy, and life changes that can impact overall wellbeing. In Fife, a text chat service was launched in November 2022 enabling young people aged 12 to 19 to have direct, confidential access to the school nursing service. Further examples are set out in Appendix 1 (page 50). Page 101 of 184
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4. Performance 32 Theme 2 Indicators – Shifting the balance of care There is a recognition by the Scottish Government, councils and NHS boards that the balance of care needs to shift out of hospital to the community. Although this was the intention of the creation of IJBs, we have not seen significant evidence of this happening. 73. Part of the aims of the integration of health and social care was to help shift resources away from the institutional settings, such as hospitals and residential care institutions, and into more community- based services. The rationale for this is that, alongside it often being a more cost-effective way of providing services, it also helps promote greater independence and improved outcomes for the individual. 74. There has been an increase in the provision of services in the community, with an increase in the percentage of adults with intensive care needs receiving care at home and in the proportion of end-of-life care provided at home or in a community setting. At the same time, the percentage of expenditure on institutional and community-based Adult Social Care services has largely remained static with a small increase in the proportion spent on accommodation-based services. 75. Indicators tracking the balance of care and provision of services in the community have largely shown an increase in the number of individuals receiving care at home or in the community. However, these changes are marginal when viewed over the period since the inception of health and social care integration in 2015. There are also indications of pressures impacting the access to community-based services and the capacity of community services (Exhibit 10, page 33). Page 102 of 184
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4. Performance 33 Exhibit 10. Theme 2 indicators Percentage of adults with intensive care needs receiving care at home 50 60 70 20232022202120202019201820172016 62% 65% +3% Proportion of last 6 months of life spent at home or in a community setting 60 70 80 90 100 2022/23 2021/22 2020/21 2019/20 2018/19 2017/18 2016/17 87% 89% +2% Percentage of patients provided with advanced booking to GP practice (3 or more working days in advance) 60 70 80 90 100 2022/232020/212019/202017/182015/162013/14 77% 50% -27% Number of days people aged 75+ spend in hospital when they are ready to be discharged (per 1,000 population) 500 600 700 800 900 1000 2023/24 2022/23 2021/22 2020/21 2019/20 2018/19 2017/18 2016/17 841 902 +7% Source: Core Suite of Integration Indicators, Public Health Scotland Page 103 of 184
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4. Performance 34 76. At the same time there has been a deterioration in the experience of those receiving those services in the community nationally Exhibit 11. Exhibit 11. Theme 2 indicators Percentage of adults supported at home who agree that they are supported to live as independently as possible 2021/222019/20 81% 79% -2% Percentage of adults supported at home who agree that their services and support had an impact in improving or maintaining their quality of life -2% 2021/222019/20 80% 78% Source: Core Suite of Integration Indicators, Public Health Scotland 77. The Auditor General for Scotland NHS in Scotland 2023 report states that ‘lack of social care capacity remains an obstacle to improving patient flow and reducing the number of delayed discharges from hospital. This is supported by data showing that many patients whose discharge is delayed are awaiting the completion of care arrangements to allow them to live in their own home (awaiting social care support), waiting for a place in a nursing home, or awaiting the completion of a post-hospital social care assessment’. 78. Examples of approaches to shift the balance of care from the hospital to community settings are set out in Appendix 1 (page 50). Page 104 of 184
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4. Performance 35 Theme 3 Indicators – Person-centred care: choice and control The amount of choice and control service users feel they have is variable across the country 79. In 2010, the Scottish Government and COSLA set out a ten-year self-directed support (SDS) strategy with the aim of supporting people’s right to direct their own social care support. The Social Care (Self-directed Support) (Scotland) Act 2013 was part of the SDS strategy and set out how councils should offer people options for how their social care is managed.12 80. The Scottish Government, IJBs, councils, providers and service users and their carers recognise the gap between what the SDS legislation is designed to do and what is happening for people trying to access services in parts of Scotland. While there are examples of people being supported in effective ways through SDS, not everyone is getting the choice and control envisaged through the strategy. Some people who use services feel they have a lack of choice and need to accept what is offered with the type of care they receive being driven by the service provider. This is most recently evidenced in the Scottish Parliament’s Health, Social Care and Sport Committee post-legislative scrutiny of the Self-directed Support (Scotland) Act 2013 phase 1 report.13 Examples of increased flexibility, choice and control were given for both individuals and unpaid carers but the Committee also reflected that many areas of improvement are required. For example, a need to improve the consistency of implementation between councils and improve clarity and knowledge around SDS by providing more support and guidance to navigate the process. 81. People who use services and their carers highlight issues accessing services. Either the times at which services are available is unsuitable or the process required to access them is overly complicated. Service users also highlighted a lack of coordination and communication between services, often having to repeat their symptoms or issues multiple times as they move from service to service. Poor data sharing was highlighted as a contributing factor. 82. People who use services described being put to bed at 2pm or left in bed for hours at a time during the day. This was largely attributed to care services being under-resourced and care workers having to schedule their day to fit in additional people. 83. Research14 has found that while those who received SDS generally had positive experiences and found it beneficial, more than one-quarter of people who use SDS had their option chosen by someone else. 84. The percentage of people who are receiving social care support through SDS is increasing, estimated at 88.5 per cent in 2021/22, up from 77.1 per cent in 2017/18. Page 105 of 184
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4. Performance 36 Exhibit 12. Percentage of adults supported at home who agree that they had a say in how their help, care or support was provided Agreed Disagreed 2021/222019/20 25% 29% 71%75% Source: Core Suite of Integration Indicators, Public Health Scotland 85. In general, there has been a deterioration in the proportion of adults who felt that they had a say in how their care is provided Exhibit 12. The latest year of data (for 2023/24) shows that 60 per cent of adults supported at home who disagreed that they had a say in how their help, care or support was provided. Due to how the data is collected this data is not comparable to previous years. 86. The Care Inspectorate amended their approach to inspections of care services in response to the Covid-19 pandemic. Inspection activity was shifted to focus on services where there were concerns or intelligence suggesting that they are a higher risk. The overall trend since 2020/21 has seen a reduction in the number of care services graded as either ‘good’ or better Exhibit 13. Exhibit 13. Proportion of care services graded ‘good’ (4) or better in Care Inspectorate inspections 2023/242022/232021/222020/21 83% 76% 75% 77% Source: Core Suite of Integration Indicators, Public Health Scotland Page 106 of 184
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4. Performance 37 87. There is limited national data on access to GPs. (The Auditor General for Scotland’s upcoming report on the General Medical Services contract will look further at the availability and quality of data.) However, the percentage of people reporting a positive experience of care at their GP practice between 2015/16 and 2023/24 has declined by 17 points Exhibit 14. There has been a decline across all IJBs and the gap between the best and worst performing areas has widened. 88. Some examples of IJBs working with partners to intervene to give people more choice and control and feedback on the services they receive are set out in Appendix 1 (page 50). Exhibit 14. Percentage of people with positive experience of care at their GP practice 0 10 20 30 40 50 60 70 80 90 100 2023/242021/222019/202017/182015/16 Min Scottish average Max Percentage Source: Core Suite of Integration Indicators, Public Health Scotland Page 107 of 184
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4. Performance 38 Theme 4 Indicators – Reducing inequalities The Covid-19 pandemic has exacerbated existing inequalities 89. A recent review15 of health inequalities found that the health of people living in Scotland’s most deprived areas is not keeping up with the rest of society. The health inequality gap is widening, evident through increased drug deaths, infant mortality and a fall in life expectancy in more deprived areas. People living in deprived areas have a significantly lower healthy life expectancy, 26 years less for males and 25 for females in the most deprived decile compared to the least deprived decile. This gap has been widening over the past decade.16 90. Research has found people who access social care, unpaid carers and those who work in the social care sector have been disproportionately impacted (both directly and indirectly) by the Covid- 19 pandemic and mitigation measures.17 The review also highlights that some groups could experience multiple and compounding inequalities. There is a risk that equality groups and people most at risk of having their human rights breached are set back by changes to and reductions in service provision, particularly as finances become tighter. 91. Respondents to a survey about their experiences of social care18 who did not receive support but felt they needed it, were proportionally more likely to be non-white, disabled, living in deprived areas, LGBO (lesbian, gay, bisexual, other) and unpaid carers. The premature mortality rate is increasing with rates higher in more urban and more deprived areas 92. The premature mortality rate is increasing across Scotland Exhibit 15 with a one per cent increase between 2016 and 2022. Exhibit 15. Theme 4 indicator Premature mortality rate per 100,000 population 400 450 500 2022202120202019201820172016 440 442 +1% Source: Core Suite of Integration Indicators, Public Health Scotland Page 108 of 184
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4. Performance 39 93. IJBs were found to have consistently lower rates of premature mortality in areas that were more rural and/or relatively more affluent. Five IJBs, all from more urban and less affluent areas (Dundee, Glasgow City, Inverclyde, North Lanarkshire, West Dunbartonshire), have consistently had relatively high premature mortality rates. Emergency bed day rates are greater in areas with higher levels of deprivation 94. There is a clear relationship between the emergency bed day rate and the deprivation and affluence of an area. Using the Improvement Service’s family groupings of IJB areas, shows that areas with higher levels of deprivation have higher levels of emergency day bed rates than areas that are more affluent Exhibit 16. Family groups are groupings of IJBs that are similar in the type of population they serve (deprivation and affluence levels) as well as the type of area they serve (rural, semi-rural and urban). Exhibit 16. Emergency bed day rate (per 100,000 population): Difference to Scottish rate -40000 -30000 -20000 -10000 0 10000 20000 30000 2022/232021/222020/212019/202018/192017/182016/17 Note: Grouping 1 represents the least deprived/affluent IJB areas and grouping 4 represents the most deprived/affluent Source: Core Suite of Integration Indicators, Public Health Scotland, Improvement Service (deprivation and affluence grouping) Page 109 of 184
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4. Performance 40 95. Example case studies in Appendix 1 (page 50) set out some programmes IJBs have in place to tackle inequalities in their communities and improve outcomes for all. Theme 5 Indicators – Unpaid carers The reliance on unpaid carers is increasing as the social care workforce is under added pressure 96. There is an enormous reliance on unpaid carers to support the social care system. These carers provide support to friends or family who need it. Carers can claim an allowance of £81.90 a week if they care for someone at least 35 hours a week. An additional carer support payment of £288.60 twice a year is also available to some carers. Although the exact number of unpaid carers is not known, as many carers don’t identify themselves as such, there are an estimated 800,000 unpaid carers in Scotland; this includes 30,000 young carers under the age of 18.19 The social care system relies on the contribution of the community and unpaid carers with the value of unpaid care estimated at £36 billion a year in Scotland.20 The Feeley Review stated that ‘The role communities play in supporting adults to remain active in their community simply cannot be overstated.’21 97. This reliance on unpaid carers is increasing as the social care paid workforce is under increased pressure. This is unsustainable. 98. Carers are feeling the mental, physical and financial pressure of a system under strain. Carers Scotland’s latest State of Caring survey22 found that over half (54 per cent) of carers said that their physical health had suffered because of their caring role, with one in five (20 per cent) suffering a physical injury from caring. Forty-four per cent of those on Carers Allowance are cutting back on food and heating. Research23 carried out by the Carers Trust on the experience of older carers found: • 80 per cent said their physical health had been affected by their caring role • 87 per cent said their mental health and wellbeing had been affected by their caring role • 82 per cent felt as though their caring role has financially affected them; 37 per cent have used less gas and electricity in their homes as a way to save money, and 19 per cent have skipped meals in the past 12 months • 46 per cent of carers had missed some form of health appointment due to their caring role. This will have knock effects for the efficiency of the health service. Page 110 of 184
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4. Performance 41 Exhibit 17. Theme 5 indicator Percentage of carers who feel supported to continue in their caring role 30.0 37.5 45.0 2023/242021/222019/202017/182015/16 40% 31% -9% Source: Core Suite of Integration Indicators, Public Health Scotland 99. Caring responsibilities fall disproportionately on women, people living in rural areas and people living in deprived areas. National indicators also illustrate the declining sense of wellbeing for unpaid carers and those needing care Exhibit 17. There are provisions in the NCS Bill to improve support to unpaid carers but this has been subject to ongoing delays. 100. Some IJBs have set up interventions to support unpaid carers such as Falkirk and Clackmannanshire Carers Centre who provide information and signposting to those who are assessed as low or moderate on the unpaid carers eligibility for support. Page 111 of 184
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425. Commissioning and procurement 5. Commissioning and procurement Commissioning and procurement practices for social care services continue to be largely driven by budgets, competition, and cost rather than outcomes for people. Improvements to commissioning and procurement arrangements have been slow to progress but are developing 101. Our 2022 Social Care briefing highlighted commissioning arrangements as a key issue stating: ‘Commissioning tends to focus on cost rather than quality or outcomes. Current commissioning and procurement procedures have led to competition at the expense of collaboration and quality.’ In this section of this report, we focus on this issue and consider what progress is being made. What are commissioning and procurement? 102. Commissioning identifies what is to be provided. It is the process each IJB uses to set out to its partner councils and NHS boards, what it requires them to provide to meet its strategic plan for social care and primary and community health services, based on population needs and available budgets. Procurement establishes how and who will provide the services. It is the process of contracting or purchasing specific services to meet those requirements. The IJBs do not procure the services. This is done by the relevant councils or the NHS and can be from the public, private and third sector. Scotland Excel assists some councils in procuring services and has developed national adult social care frameworks. Currently, the private sector provide 54 per cent of social care services, 24 per cent by councils, 21 per cent by the third sector and the remaining element (one per cent) by health boards.24 103. All IJBs have integration strategic commissioning plans. The 2014 Act sets out requirements for the plans that are also supported by Scottish Government guidance issued in 2015.25 The plans are required to: • be reviewed at least every three years • set out what the arrangements are to carry out the tasks of the IJB over the three years Page 112 of 184
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5. Commissioning and procurement 43 • divide the area geographically into at least two localities for setting out these arrangements with each locality done separately • include how the arrangements are intended to contribute to achieving the national health and wellbeing outcomes. 104. The commissioning of social care and primary and community health services is a cyclical process carried out by a Strategic Planning Group for each IJB. This group must consider the outcomes for people and how the needs and availability of services change. Healthcare Improvement Scotland and the Care Inspectorate have produced a quality framework26 to evaluate the effectiveness of strategic planning. 105. The Independent Review of Adult Social Care in Scotland, considered in detail the arrangements for commissioning and procuring social care services in Scotland. The review identified ten changes needed in commissioning and procurement practices. Improvements to commissioning and procurement arrangements have been slow, with cost rather than outcomes driving decision-making 106. Commissioning and procurement decisions are currently driven largely by achieving the range and volume of services required at the lowest cost. This is understandable given the financial pressures and increased demand faced by IJBs, but the pressure on the service providers to remain competitive can reinforce a focus on driving down prices. This can be at the cost of promoting service quality, equality, innovation and collaboration with others, to improve people’s outcomes. 107. Tenders for support packages for people are often constructed around time and task of the service, rather than the outcomes. This lack of flexibility in the system means that NHS and council resources can get tied up in providing services that aren’t effective in improving outcomes. More flexibility is needed across the system. 108. The cyclical nature of the commissioning and procurement, mean that time and resource are focused on contracts renewal processes instead of a more strategic long-term approach. 109. As set out at paragraph 25, the current model of governance is complicated. This can cause difficulties when trying to commission services in a collaborative way. All stakeholders, including providers and users need to be part the strategic commissioning process in order to reflect what people need and want. This current approach also does not fully allow for innovation of the sector in finding solutions. 110. The current commissioning and procurement system lacks a process of accountability when people do not receive the services they need. People have described the process of accessing social care as Page 113 of 184
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5. Commissioning and procurement 44 ‘notoriously difficult’ and ‘over-complicated’ and needing to ‘fight for’ and ‘justify’ their support where they had a negative experience.27 Current commissioning and procurement practices are a risk for the sustainability of service providers and the workforce 111. Current arrangements are heavily reliant on a stable provider market and workforce but there are exacerbating financial and workforce issues facing providers, risking the viability of some. 112. A consequence of the current cyclical commissioning and procurement arrangements is that many risks around the effective delivery of service are largely put onto the providers. For example, where the cost of energy makes a service more expensive to deliver than the contract provides for, the provider is still required to provide the service, bearing the loss. 113. There is uncertainty for all providers, particularly in the third sector around future funding and their role in service provision. Providers are also experiencing challenges with providing services and fulfilling contracts largely due to difficulties with workforce recruitment and retention: • Private and third sector providers find that council commissioning rates are not enough to deliver social care and support and residential, personal and nursing care, and pay expenses such as staff, training and overheads. These providers say they cannot compete with councils where pay and terms and conditions are better than they can provide due to the flat cash settlement local government receives from the Scottish Government. • Non-committal framework agreements leading to zero hours or short hour contracts for staff. • Contracts that do not cover travel costs, especially challenging in rural Scotland which were particularly badly affected by fuel price rises. • Growth in split shifts and reduction in paid sleepovers for staff. • Although there has been an uplift in adult social care workers’ wages, this has not been universally applied for all social care workers as some roles have been out of scope for the intended policy outcome. This has focused on uprating pay for those on the lowest incomes. There is no equivalent uplift for those with supervisor or manager roles making these positions less desirable. • High levels of overtime and agency costs. • High and ongoing recruitment costs, particularly in more rural areas. Page 114 of 184
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5. Commissioning and procurement 45 114. Local government have been calling for multi-year funding settlements from the Scottish Government to support providers with medium- to long-term planning. This is currently being discussed through the Verity House Agreement and the fiscal framework discussions. 115. As set out in the context section, the workforce feel undervalued in the system and there are unprecedented numbers of vacancies (paragraph 19). The Fair Work Convention Report28 set out that ‘Despite some good practice and efforts by individual employers, the wider funding and commissioning system makes it almost impossible for providers to offer fair work.’ Without urgent progress on the fair working agenda nationally it is likely that the risks to the sustainability of the sector will deepen. Current commissioning and procurement practices are not always delivering improved outcomes for people 116. People who use services are often not involved in commissioning and procurement processes and therefore services are not necessarily reflective of what people need and want. The Independent Review of Adult Social Care in Scotland29 reported that commissioning using generic frameworks based on an hourly rate does not work well for people who have fluctuating needs for support, particularly support for mental health. 117. The Self-directed Support (Scotland) Act 2013 was designed to ensure people had choice and control in how their social care support is provided. As highlighted at paragraph 80, there is a recognised implementation gap in this policy. The Scottish Parliament’s Health, Social Care and Sport Committee post-legislative scrutiny of the Act has highlighted concerns around commissioning in relation to SDS including: • the importance of facilitating collaborative commissioning conversations • a need to develop a marketplace of providers • a need to end competitive tendering and restrictive procurement processes • the disparity in the relative available funding under different SDS options. Fair work is work that offers all individuals an effective voice, opportunity, security, fulfilment and respect. It balances the rights and responsibilities of employers and workers. Page 115 of 184
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5. Commissioning and procurement 46 There is an increasing desire to move towards more ethical and collaborative commissioning models but it has not yet been universally adopted 118. There are examples of IJBs attempting to adopt collaborative and ethical commissioning processes in their strategies but these appear to be at an early stage. Almost a third of IJBs have adopted the Unison Ethical Charter for Social Care Commissioning30 which is based on ethical commissioning principles. 119. IJBs are reaching out for support from IRISS (Institute for Research and Innovation in Social Services) in collaborative commissioning, for example work to improve outcomes-based commissioning with East Dunbartonshire, East Ayrshire and Orkney IJBs with Healthcare Improvement Scotland. IRISS has also been supporting West Dunbartonshire and North Ayrshire IJBs to change commissioning to a more collaborative approach. Both projects are at an early stage but they have highlighted that the relationship between stakeholders are a key aspect of addressing commissioning arrangements. Significant time and resource capacity is needed to work out these relationship issues. 120. There are some strong examples of how IJBs are working to commission in a more collaborative and flexible way including Aberdeen IJB and Fife IJB. Two examples are set out in Appendix 1 (page 50). National approaches to improve commissioning have been slow to progress but are developing 121. Across stakeholders we have engaged with, there is a recognition that commissioning needs to improve. The Feeley Report recommended that the Scottish Government and COSLA develop and agree ethical commissioning principles and core requirements. This is happening through the development of the NCS Bill, an Adult Social Care Ethical Commissioning Working Group was set up (also including the Institute for Research and Innovation in Social Services (IRISS), Social Work Scotland (SWS) and the Coalition of Care and Support Providers in Scotland (CCPS)). This group is developing a framework for ethical commissioning and has identified nine ethical commissioning principles: • Person-led care and support • Outcomes-focused practices • Human rights approach • Full involvement of people with lived experience • Fair working practices • High-quality care and support • Climate and circular economy Ethical commissioning aims to embed ethical standards into the commissioning and procurement process to ensure the process is around equity and quality for people, not just around efficiency and cost. Page 116 of 184
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5. Commissioning and procurement 47 • Financial transparency, sustainable pricing and commercial viability • Shared accountability. 122. Current Scottish Government plans are that the NCS Bill will include a clear and comprehensive definition of ethical commissioning, with a National Care Service Board31 providing national oversight, guidance and practical support.32 Page 117 of 184
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48EndnotesEndnotes Endnotes 1 Lead Agency model - In Highland the NHS Board and council have adopted a different model for integration, a lead agency model. NHS Highland leads on adult services and Highland Council leads on children’s services. Therefore, there is no Integrated Joint Board but an Integration Joint Monitoring Committee to monitor the planning and delivery of services. Revisions to the National Care Service Bill currently being developed, propose that Highland adopt a reformed IJB model as these are implemented. 2 Independent Review of Adult Social Care in Scotland, Derek Feeley, February 2021 3 People supported through Social Care Services: Support provided or funded by health and social care partnerships in Scotland 2022/23, Public Health Scotland, March 2024. 4 Mid-2022 Population Estimates, Scotland, National Records of Scotland, March 2024. 5 Scotland’s Health and Demographic profile, Social Research, Scottish Government, June 2022. 6 Scotland’s Unsustainable Health Service Modelling NHS demand to 2040, Our Scottish Future Health Commission, December 2023. 7 Population projections of Scotland - National Records of Scotland January 2023. 8 Staff vacancies in care services 2022, Care Inspectorate and Scottish Social Services Council, September 2023. 9 Workforce Recruitment and Retention Survey Findings, Scottish Care, September 2021 10 People who access social care and unpaid carers in Scotland, Scottish Government, June 2022 11 Local Government Benchmarking Framework, Improvement Service, February 2024 12 Self-directed support (SDS) aims to improve the lives of people with social care needs by empowering them to be equal partners in decisions about their care and support. Four fundamental principles of SDS are built into legislation – participation and dignity, involvement, informed choice and collaboration. The Social Care (Self-directed Support) (Scotland) Act 2013 gave councils responsibility, from April 2014 onwards, for offering people four options for how their social care is managed: – Option 1: The individual or carer chooses and arranges the support and manages the budget as a direct payment. – Option 2: The individual chooses the support and the authority or other organisation arranges the chosen support and manages the budget. – Option 3: The authority chooses and arranges the support. – Option 4: A mixture of options 1, 2 and 3. 13 Post-legislative scrutiny of the Social Care (Self-directed Support) (Scotland) Act 2013: Phase 1: SP Paper 577, Health, Social Care and Sport Committee, May 2024. Page 118 of 184
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49EndnotesEndnotes 14 My Support My Choice: People’s Experiences of Self-directed Support and Social Care in Scotland National Report, ALLIANCE and Self Directed Support Scotland, October 2020. 15 Leave No-one Behind The state of health and health inequalities in Scotland, The Health Foundation, An Independent Review, David Finch, Heather Wilson, Jo Bibby, January 2023. 16 Health Life Expectancy in Scotland 2019-2021, National Records of Scotland, December 2022. 17 Adult Social Care in Scotland – Equality Evidence Review, Scottish Government, June 2022. 18 Health and Care Experience Survey, Scottish Government, May 2022. 19 Scotland’s Carers Update Release, Scottish Government, December 2022. 20 Independent Review of Adult Social Care in Scotland, Derek Feeley, February 2021. 21 Independent Review of Adult Social Care in Scotland, Derek Feeley, February 2021. 22 State of Caring Survey 2023, Carers Scotland, November 2023. 23 Experiences of Older Adult Unpaid Carers in Scotland, Carers Trust Scotland, March 2023. 24 Summary of No. of registered care services at 31 March 2024, Care Inspectorate. 25 Strategic commissioning plans: guidance, Scottish Government, December 2015. 26 Evaluating the Effectiveness of Strategic Planning: Quality Framework, Care Inspectorate and Healthcare Improvement Scotland. 27 Independent Review of Adult Social Care in Scotland, Derek Feeley, February 2021. 28 Fair Work in Scotland’s Social Care Sector 2019, Fair Work Convention, February 2021. 29 Independent Review of Adult Social Care in Scotland, Derek Feeley, February 2021. 30 UNISON’s ethical care charter, UNISON. 31 The remit and membership of a National Care Service Board will be determined by at Stage 2 of the National Care Service Bill. The overarching purpose of the Board ‘will be to ensure consistent, fair, human rights-based social care support and community health services, underpinned by effective complaints mechanisms and enhanced advocacy services’. 32 National Care Service (NCS) (Scotland) Bill: Scottish Government Response to Stage 1 report, Letter from Minister for Social Care, Mental Wellbeing and Sport to Health, Social Care and Sport Committee, March 2024. Page 119 of 184
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50Appendix 1 Appendix 1 Case studies These case studies set out some examples of where integrated joint boards are using or developing different working practice to improve performance and outcomes. Case study 2. Early intervention and prevention services Preventing Frailty by Improving Nutrition (Shetland) People providing care and support have an important role in recognising risk and preventing malnutrition. A project in the summer of 2022 led by the dietetics department in collaboration with Shetland residential teams including social care workers, seniors, care home cooks and care at home staff in the community. The project included reviewing dietetic patients care, menu and mealtime observations and advice, training needs analysis and delivery of MUST (Malnutrition Universal Screening Tool) training. The IJB reported that confidence in ability to screen for malnutrition, provide nutrition advice and care, and actioning nutritional care plans was considerably increased following training, which was provided to more than 100 staff across Shetland. Whole Family Wellbeing Funding programme (national scheme) The Whole Family Wellbeing Funding (WFWF) is a £500 million Scottish Government investment in preventative whole family support measures. The aims of the fund are to support the change that is necessary for reducing the need for crisis interventions in families, and to move investment towards early intervention and prevention. The scheme is funded nationally from 2022 to 2026 with any new systems or services funded locally after that period. Page 120 of 184
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Appendix 1 51 The programme is split into three parts: • to provide direct support to Children’s Services Planning Partnerships (CSPPs) to help expand and deliver whole family support services as well as support transformational change • to support local transformation through National Support for Local Delivery • support projects that take a cross Scottish Government approach to system change which progress the aims of WFWF. An evaluation report of year one funding of the first two parts reports that substantial progress has been made so far across most CSPPs. However, they have found it difficult to achieve the pace of progress envisaged by the Scottish Government in year one of the funding. In South Lanarkshire, the funding has enabled the recruitment of peer support workers with lived experience who are able to reduce the stigma of needing support. The funding also enabled the creation of a team of early years staff, based in NHS Lanarkshire, that will give support to families that have children under the age of five. In addition, the funding enabled the expansion of Pathfinders, a school-based family project that aims to reduce the need for later intervention. The funding has supported North Ayrshire to add two further locations to their Family Centred Wellbeing Service. The fund has also seen the expansion of North Ayrshire’s Health Visiting Team, which aims to support early intervention and prevention for children by working with the whole family. Source: Scottish Government and Shetland Health and Social Care Partnership Page 121 of 184
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Appendix 1 52 Case study 3. IJBs shifting the balance of care Home First Response Service (Glasgow) Glasgow’s Home First Response Service has the aim of ensuring frail people spend less time in hospital. The service is community led and made of multi-disciplinary frailty teams. Each team is led by advanced frailty practitioners based in hospitals with 26 now in post following a successful pilot of the service. One in three people identified during the pilot were discharged the same day with a care plan having been put in place. To enable fast access to the community services needed to move frail people out of hospitals and back home, the service uses a hub and spoke service model with each of the six Health Partnerships in Glasgow having their own frailty teams. The teams liaise with other healthcare colleagues in the community including advanced nurse practitioners, pharmacists and allied health practitioners. This ensures that people receive the same level of care that they would in a hospital setting. The Home First Response Service has been achieving, on average, a 50 per cent early turnaround rate per month. Integrated Discharge Hub (West Lothian) The West Lothian Integrated Discharge Hub (IDH) was set up in 2018 at St John’s Hospital to improve delayed discharges and reduce the time it was taking make arrangements for people requiring care and support in the community following discharge from hospital. To plan the safe and timely discharge of patients, an inter-agency team consisting of discharge coordinators, hospital social workers, Carers of West Lothian as well as inhouse care team staff work with patients and their families to plan their discharge and how their ongoing requirements will be met in the community. Since the implementation of the discharge hub the IJB reports that improvements have been seen, with reduced lengths of stay, reduced occupied acute bed days, improved performance for days lost to delays in discharge and improved processes for interim placements when a patient is waiting for care home placement. Between December 2022 and April 2023, the average number of days between a person being admitted to St John’s Hospital and being identified as needing the support of the discharge hub has been reduced by 52 per cent. The length of stay for patients getting help from the discharge hub has also been reduced by 28 per cent during the same period. The success of the discharge hub has drawn interest from other IJBs across Scotland. Page 122 of 184
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Appendix 1 53 The Joint Dementia Initiative (Falkirk) The Joint Dementia Initiative (JDI) is a registered service in the Falkirk Health and Social Care Partnership. It has two main services: a one-to- one support service, which provides care and support at the user’s own home, and a Home from Home service, which provides support to users in a group setting. The JDI service aims to help people with dementia to continue to live the life they want to live by continuing to live at home in their own communities for as long as possible. This is delivered through meaningful engagement with service users, families, and key stakeholders from across Falkirk HSCP following a person-centred approach to the care provided. A review of the JDI was carried out in April 2021 that included arranging engagement events with service users, their families, carers, staff, and stakeholders. The aim was to improve outcomes for families and carers and identify specific areas of concern and gaps in service delivery. Identified as an important issue at the engagement events, the partnership looked at the flexibility of the service and dementia being a 24/7 illness. The partnership is working to provide evening and weekend support for families and carers, due to start in August 2024. These improvements would allow the partnership to achieve outcomes from their strategic plan. A current project is being carried out to change Adult Placement Carers in the Home from Home service from self-employed to employees of the partnership. This change aims to improve recruitment and retention rates for the service. The JDI has been successful in achieving funding from multiple funds including the Dementia Innovation Fund and the Carers Challenge Fund. This has allowed the Initiative to renovate their community space as well as create two part time support worker posts to help provide evening and weekend support to service users Source: NHS Greater Glasgow and Clyde, West Lothian Health and Social Care Partnership, and Falkirk Health and Social Care Partnership Page 123 of 184
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Appendix 1 54 Case study 4. Choice and control Community Brokerage Network (North and South Ayrshire) The Community Brokerage Network is well established in the Ayrshires and provide brokers, who offer free independent information about self-directed support to people and their carers at any stage in their social care journey, whether they are entitled to a formal social care assessment or not. They have successfully connected people with services that have helped them achieve their personal outcomes in a way that works for them. A Brokerage Framework for Scotland has recently been produced by Self-directed Support Scotland and its partners to help encourage the use of this model further across Scotland. Care Opinion (Falkirk) Care Opinion is an online integrated platform where people can safely share their experience of any health service or Care Inspectorate- registered providers of adult social care services. Care Opinion has national scale and visibility and has worked with all Scottish health boards as well as ten HSCPs. Over 29,000 stories have been shared about health and social care services in Scotland on the Care Opinion platform. Care Opinion enables Falkirk HSCP and the commissioned providers to use online feedback as one method of learning from lived experience. The aim is to drive forward quality service improvements, build a reputation for openness, to potentially avoid formal complaints, and develop a culture of transparency across the Partnership. Source: Self Directed Support Scotland, Falkirk Health and Social Care Partnership Page 124 of 184
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Appendix 1 55 Case study 5. Work to reduce inequalities Welfare Advice & Health Partnerships (WAHPs) programme (Glasgow) Scottish Government funding is enabling 84 GP Practices across the most deprived parts of Glasgow to host a dedicated welfare and health adviser one day per week. According to the Partnership this has had a positive impact on patient health, poverty and health inequalities, while also freeing up staff time for clinical care. In the last year, there have been 3,997 referrals made by WAHP practice staff across Glasgow, achieving a reported £3.3 million in financial gains and £1.1 million in debt managed for people. eFRAILTY Power BI dashboard (West Lothian) The eFRAILTY Power BI Dashboard was created with the aim to provide a snapshot of the make-up of frailty within the West Lothian population with the goal of identifying people who could benefit from help, improving the health inequality gap. The dashboard also has the aim of mapping frailty data by GP postcode to enable the targeting of resources. The data in the dashboard uses the Rockwood clinical frailty score from patient and carer self-assessment forms. These forms are collected at vaccination centres each year during the patient’s annual flu jab. The frailty data is collected by the vaccination nurses and then entered into GP systems before being extracted and used to populate the eFRAILTY dashboard. The dashboard is still in the scoping and data-gathering phase, however the Partnership is looking at options for how to put the data to use. An example given by the Partnership for the use of the data was to refer patients graded as having mild frailty to their Xcite Exercise referral scheme. Source: Glasgow City Health and Social Care Partnership, Scottish Government, and West Lothian Health and Social Care Partnership Page 125 of 184
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Appendix 1 56 Case study 6. Granite Care Consortium Established in October 2020, Granite Care Consortium (GCC) is composed of a mix of ten independent and third sector care providers delivering over 12,000 hours of care a week to more than 1,200 people. GCC was set up with the aim of creating market stability, improving outcomes for service users and building a consistent trained and skilled workforce. Competitive methods of commissioning and procurement were identified as presenting a risk of providers reducing their services or exiting the market completely. Providers also often work in silos with little input or communication from other services. Aberdeen City Health and Social Care Partnership (ACHSCP), commissioned GCC to take a collaborative approach, with a focus on the outcomes for the individual. This saw GCC move away from a ’time and task’ model towards one built around the service user. The collaboration between providers allows different types of support to be added to a care plan without the need for time consuming reassessments. For example, someone receiving mental health support who then required personal care could have this added to their care plan in a matter of hours. Collaboration has also enabled greater data sharing and visibility. GCC use data at a local level as well as city wide to inform decision-making. A recent test of change has seen the introducing of hotspots allowing GCC to focus on where demand for care is greatest. Funding is provided in monthly blocks by ACHSCP which allows GCC to flex individual care and support packages without the need for social worker authorisation. This speeds up the process, improving outcomes for individuals. The number of days those aged 75+ in Aberdeen City are waiting to be discharged from hospital (per 1,000 population) stands at 112 as of November 2023. This is down from 579 in 2019/20. GCC faces the same workforce challenges as the wider sector but is using its outcomes focussed model as a positive tool to aid recruitment and retention. Learning and development is also a large part of the workforce strategy with GCC working in partnership with Robert Gordon University to develop new ways of delivering training. I have felt partnership working between ACHSCP and GCC has been stronger than my previous experience before GCC – Social Worker Building trust, both from ACHSCP and the ten partnering service providers, was crucial in delivering this model. Challenging traditional ways of working and thinking was acknowledged by GCC as difficult but it reports that there is now genuine trust between all parties and the culture of collaboration is now embedded within the consortium. Page 126 of 184
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Appendix 1 57 The Scottish Parliament Health, Social Care and Sport Committee have identified this work as a good model to provide the basis to develop best practice in ethical commissioning. Source: LGBF Indicators, GCC Annual Report 2020-21 Case study 7. Fife Care Collaborative Established in 2021 the Care at Home Collaborative was a Collaborative of 16 Independent Care at Home Providers who delivered over 90 per cent of externally commissioned care at home services in the Fife IJB area. The Collaborative in June 2024 are now made up of 41 care at home Providers including Fife Council. The split between service delivery is approximately 30 per cent Council and 70 per cent Collaborative. The aim of the collaborative is to involve all member organisations in active engagement and participation as well as to share best practice and lessons learned. The collaborative also aims to benefit from the economy of scale of working together, for example securing funding to maintain a higher weekend pay rate has helped the retention of staff. One of the members of the collaborative, Cera Care, commented: ‘Since joining the Collaborative we have seen a dramatic improvement in the services we deliver as a whole in Fife. It has given us the opportunity to communicate with Scottish Care, Fife Council and External Providers together to input ideas and suggestions across to help each other and the people we care for.’ The collaborative makes use of a GPS tool called ‘Pin-Point’ which is a live dashboard of services used to manage commissioning. The IJB is able to manage capacity across the whole system by using monitoring and escalation systems that are connected to the collaborative. A recent self-evaluation saw that previous recruitment and retention issues encountered by providers have been continuously improving and attributable to the success of the Collaborative. Source: Fife Health and Social Care Partnership Page 127 of 184
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58Appendix 2 Appendix 2 Methodology Previous work In 2022 and in 2023, the Accounts Commission published bulletins setting out the financial performance of IJBs. Together with the Auditor General for Scotland and Audit Scotland, we have reported more widely on the progress of health and social care integration and social care in Scotland. This includes reports in 2015 and 2018 setting out improvements needed by integration authorities. Our work in 2014 and 2017 set out the progress of the self-directed support legislation implementation and found while implementation was happening successfully in some areas, not everyone was getting the choice and control in their social care support envisaged in the legislation. In January 2022, a joint Social Care briefing set out the significant ongoing challenges impacting the delivery of social care services. We aim to answer the following audit questions in this report: • How well are IJBs responding to contextual challenges and improving their performance and the outcomes for people? • How financially sustainable are IJBs and how are they responding to the financial challenges they face? • How are IJBs using commissioning and procurement to improve performance and deliver improved outcomes in the lives of people who use social care services? Our findings are based upon: • the 2022/23 audited accounts and annual audit reports of IJBs and supplementary returns provided by appointed auditors • the 2022/23 annual performance reports and Chief Social Work Officer reports of IJBs • national data sets including core integration indicators and the Local Government Benchmarking Framework (LGBF) • a review national reports and guidance • a review of relevant published research • interviews with key stakeholders including IJB chief officers and chief finance officers. In February 2024, we hosted a roundtable discussion bringing together key stakeholders to consider the critical issues for IJBs and in particular Page 128 of 184
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59Appendix 2 the provision of social care. The discussion covered immediate challenges as upcoming issues in the medium and long term. The discussion helped to inform this report and also identify future work for the Accounts Commission. The additional output sets out a summary of discussion. Advisory Group To support our work, an Advisory Panel was established to provide challenge and insight at key stages of the audit process. Members sat in an advisory capacity only and the content and conclusions of this report are the sole responsibility of Audit Scotland. Members of the group included representatives from Health and Social Care Scotland, COSLA, Care Inspectorate, The ALLIANCE, Coalition of Care and Support Providers Scotland, Scottish Care and SPICe. We would like to thank them for their support. Page 129 of 184
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Integration Joint Boards Finance and performance 2024 Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN Phone: 0131 625 1500 Email: info@audit.scot www.audit.scot ISBN 978 1 915839 44 2 Page 130 of 184
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Midlothian Integration Joint Board Audit and Risk Committee Midlothian IJB Internal Audit Report: Directions Thursday 12 September 2024 Executive summary The purpose of this report is to present the findings and recommendations from the recently completed Internal Audit review of Directions, completed by the Midlothian Council Internal Audit team. The MIJB Audit and Risk Committee is therefore asked to consider the findings and recommendation from the final Internal Audit review of Directions. Item number: 5.6 Page 131 of 184
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Midlothian Integration Joint Board Page 2 Report Midlothian Internal Audit Report: Directions 1. Purpose 1.1 The purpose of this report is to present the findings and recommendations from the recently completed Internal Audit review of Midlothian IJB Directions, completed by the Midlothian Council Internal Audit team. 2. Recommendations 2.1 To consider the findings and recommendations from the recently completed Internal Audit review of Midlothian IJB Directions. 3. Background and main report 3.1 As part of the Internal Audit Plan for 2023/24, approved by the audit and risk committee on 28 June 2023, an Internal Audit of the MIJB Publication Scheme. 3.2 The report presents the findings of the review with the internal audit work undertaken by the Midlothian Council Internal Audit team. The report is graded reasonable assurance and provides 3 low rated recommendations that have all been agreed by the MIJB Chief Officer. 4. Directions 4.1 Any implications for directions are included within the report. 5. Equalities Implications 5.1 There are no equalities implications. 6. Resource Implications 6.1 There are no resource implications. 7. Risks Page 132 of 184
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Midlothian Integration Joint Board Page 3 7.1 Key risks in relation to Directions setting within the IJB have been considered as part of the review. 8. Involving People 8.1 Consultation on this Internal Audit Report has been undertaken with the MIJB Chief Officer and Integration Manager, Midlothian Health & Social Care Partnership prior to submission to the MIJB Audit and Risk Committee. 9. Background Papers See Appendix 1. AUTHOR’S NAME Duncan Stainbank DESIGNATION MIJB Chief Internal Auditor CONTACT INFO Duncan.Stainbank@midlothian.gov.uk DATE 02/09/2024 Page 133 of 184
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OFFICIAL OFFICIAL Final Report Midlothian IJB Directions August 2024 Conclusion Reasonable Assurance Page 135 of 184
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1 OFFICIAL OFFICIAL Contents page Executive Summary 2 Headlines 3 Areas where expected controls are met/good practice 4 Detailed Recommendations 5 Appendices Appendix A – Recommendation Grading/Overall opinion 8 Appendix B – Resource, acknowledgements & distribution list 9 Page 136 of 184
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OFFICIAL OFFICIAL 1 Executive Summary: MIJB Directions Conclusion: Reasonable Assurance Directions are being developed in accordance with the Public Bodies Joint Working Act 2014 and the Good Practice Guidance on Directions issued by the Scottish Government in January 2020 including work to ensure an auditable log of Directions is maintained. However, improvements are required as a number of suggestions and requirements from the guidance were not in place; and gaps were identified between the Directions Log and the HSCP Service Plans including the 2022-23 Directions which were closed and passed down to services. Background The Midlothian Integration Joint Board (MIJB) was established under the Public Bodies Joint Working Act 2014 (the Act). The Partnership comprises NHS Lothian (NHSL), and Midlothian Council (the Council) who work together to deliver health and social care services for adults across the region. Directions are the mechanism by which Integrated Authorities communicate their priority actions to both Midlothian Council and NHSL. The MIJB must issue in writing, binding directions to the Council and NHSL. Directions can be issued at any time and once issued have no expiry date; they can also be withdrawn or amended at any time. The Good Practice Guidance on Directions issued by the Scottish Government in January 2020 makes it clear that Directions must set out a clear framework of how each integrated health and social care function is to be exercised; the budget allocated and how that budget is to be used. It is also good practice to describe how the direction links to the strategic plan and any related performance outcomes against which they can be measured. Summary of findings & recommendations The following key findings and recommendations are highlighted, which have all been agreed by the Integration Manager: • There is no MIJB Directions policy which is recommended by the Good Practice Guidance on Directions issued by the Scottish Government. Management will establish an MIJB Directions policy by 31 March 2025. • There was a lack of audit trail between the Directions log and the HSCP 2023-24 service plans including the 16 revoked Directions from 2022-23 which were passed down to services and 2 of the HSCP 2023-24 service plans where not linked to the new Directions issued out in 2023-24. This will be addressed by 31 March 2025. • The Directions log does not highlight delivery issues and the total resource committed as recommended in the Good Practice Guidance on Directions. There is not a clear link between the Directions issued and the budget allocation as the funding is allocated to each service areas and no revisions were made during 2023/24 when ongoing developments were made to the budget including the MIJB reviewing the financial recovery options. Management advised that the Directions are the mechanism to action strategy so many of them are cross cutting over multiple service areas and therefore the funding allocation issue by Direction is impossible. The Financial recovery options in June 2023 had no further implications for Directions so they were not revised. However, Directions for 2024/25 have each of the IJB recovery actions noted with a clear saving target noted against each one. Recommendation Summary Recommendations Grade High Medium Low Total Current Report - - 3 3 Prior Report N/A N/A N/A 3 Materiality The MIJB issued 21 Directions during 2023-24. The closing 2023/24 budgets from partners delegated to the MIJB is £186,584,000. The total 2024/25 budget delegated to the MIJB is £155,177,000. . Page 137 of 184
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3 OFFICIAL OFFICIAL 2 Headlines Objectives Conclusion Comments 1. The Directions setting process within the Midlothian IJB (MIJB) is in accordance with the Public Bodies (Joint Working) (Scotland) Act 2014 and the Scottish Government statutory guidance published in 2020 Reasonable The MIJB welcomed the more strategic focus allowed by aligning the Directions to the 9 National Health and Wellbeing Outcomes. However, there was not always a clear audit trail between the Directions log and the HSCP 2023-24 service plans including the 16 revoked Directions from 2022-23 which were passed down to services. From the 25 Service plans, 2 of the 2023-24 HSCP service plans were not linked to the new Directions issued out in March 2023. The MIJB currently has no Direction Policy which is recommended by the Good Practice Guidance on Directions issued by the Scottish Government and are currently using the Scottish Government statutory guidance to check for compliance. In addition, the Directions log does not highlight delivery issues and the total resource committed. Management advised that there are difficulties mapping out the Directions to the funding as the budgetary information they have available are at a service budget level. 2. There is a clear linkage between Directions and the IJB Strategic Plan Reasonable The Strategic Commissioning Plan for 2022-25 was approved by Midlothian IJB on 14th April 2022. The 2023-24 Directions sit under the 9 National Health and Wellbeing outcomes which has an alignment to the Midlothian IJB Strategic Plan 2022-2025. Management advised that they are reviewing the strategic plan and how this will link more tangibly with Directions and to the service plans. 3. Directions, when set, have been clearly communicated to the organisations, people and structures required to deliver the directions Substantial Integration Authorities, Health Boards and Local Authorities have a legal obligation to both issue and monitor the effectiveness of Directions as described in the Public (Joint Working) (Scotland) Act 2014. Midlothian IJB published their Directions to Midlothian Council and NHS Lothian for 2023-24 on 31st March 2023; and for 2024-25 this was published in June 2024. MIJB Directions were issued to the Chief Executives of Midlothian Council and NHS Lothian. 4. There is a clear process in place to monitor and review the progress of Directions during the year. Substantial A 6 monthly report and a year-end report is provided to the MIJB to report the progress made on Directions. It was noted that many of the 2023/24 Directions have not progressed as quickly as anticipated. Therefore, the Directions for 2024/25 were not significantly changed. Management highlighted to the MIJB that this approach additionally allows partners the time to understand the full impact of funding changes and then work alongside Midlothian IJB to commission services in new and increasingly innovative ways. Reaching a balanced financial position and understanding the whole system impact is necessary to make the right decisions and prioritise the right actions. Page 138 of 184
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4 OFFICIAL OFFICIAL 3 Areas where expected controls are met/good practice No. Areas of Positive Assurance 1. Directions are being developed in accordance with the act and good practice guidance including work to ensure an auditable log of Directions is maintained. During 2022-23, the MIJB completed a rigorous review of 157 issued Directions to ensure control around strategic planning, performance monitoring and ongoing review of priority actions. The development of the MIJB 2023-24 Directions resulted in 21 Directions. 2. MIJB Directions are monitored by the MIJB every 6 months which checks on the progress made after 6 months of the Directions being issued; and the closing position at the year end. 3. The MIJB uses outcome mapping and has developed a Strategic Commissioning Map that provides a real-time picture of the whole system progress towards their strategic aims and the 9 national health and wellbeing outcomes by linking to service outcome maps. This allows services to track their contributions to improving outcomes. Page 139 of 184
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5 OFFICIAL OFFICIAL 4 Detailed Recommendations Directions Policy Objective 1 The directions setting process within the Midlothian IJB (MIJB) is in accordance with the Public Bodies (Joint Working) (Scotland) Act 2014 and the Scottish Government statutory guidance published in 2020. Grade Recommendation The Good Practice Guidance on Directions issued by the Scottish Government published in 2020 states that it would be helpful for IJBs to develop a Directions policy, based on their statutory guidance. The MIJB currently has no Direction Policy and are currently using the Scottish Government statutory guidance to check for compliance. There is a risk that without a Directions policy the MIJB may result in ineffective governance and accountability between the NHS and the Council to deliver services that are under the control of the MIJB. Low 1.1 A Directions Policy should be established for the MIJB. Management response Responsible officer & target date 1.1 The Directions Policy is on the MIJB Governance Plan for 2024/25. We were waiting to get the outcome from the Direction Internal Audit review; and the Scottish Government recently published a statutory guidance for Strategic Planning which may have an impact on the statutory guidance for the Directions. 1.1 Integration Manager, Midlothian Health and Social Care Partnership by 31 March 2025 Page 140 of 184
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6 OFFICIAL OFFICIAL 4 Detailed Recommendations Directions setting and links to Health and Social Care Partnership (HSCP) Service Plans Objective 1 The directions setting process within the Midlothian IJB (MIJB) is in accordance with the Public Bodies (Joint Working) (Scotland) Act 2014 and the Scottish Government statutory guidance published in 2020. Grade Recommendation 157 Directions were reported to the MIJB in February 2023 as the year end position of the 2022-23 Directions. The MIJB noted the recommendations from SPG to progress Directions as complete, revised or revoked. The report highlighted 74 revoked Directions which were either handed down to services or the MIJB agreed to close. The Board welcomed the more strategic focus taken in reducing the proposed number of Directions to be issued by the Board for 2023-24. The MIJB issued out 21 Directions for 2023-24 which sit under the 9 National Health and Wellbeing Outcomes. From the 2022-23 Directions which were revoked and passed down to services, testing identified that there was a lack of audit trail between the 16 revoked Directions to the 2023-24 HSCP Service Plans; and from the 25 service plans reviewed, 2 of the service plans (Immunisation 0-5 years team and Pharmacy) were not linked to the new Directions issued out in March 2023. There is a risk that the partners are not engaged in delivering the directions. Low 1.2 There needs to be a clearer audit link between the Directions Log and the HSCP Service Plans. Management response Responsible officer & target date 1.2 This will be addressed by the HSCP services. Once the IJB revokes a Direction it doesn’t need to revisit that Direction. Services may have legitimately found that a revoked Direction from the 2022-23 issued is no longer relevant, reasonable, or viable and the IJB no longer has any reason to questions those operational decisions via the mechanism of Directions. 1.2 Executive Business Manager by 31 March 2025 Page 141 of 184
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7 OFFICIAL OFFICIAL 4 Detailed Recommendations Financial implications and total resource committed to each Directions Objective 1 The Directions setting process within the Midlothian IJB (MIJB) is in accordance with the Public Bodies (Joint Working) (Scotland) Act 2014 and the Scottish Government statutory guidance published in 2020. Grade Recommendation The Good Practice Guidance on Directions published in 2020 states that the Directions log should include as a minimum, the function(s) covered, any identifier (such as a log number), date of issue, identify to which delivery partner(s) issued, any delivery issues and the total resource committed. The guidance also states that Directions issued at the start of the financial year should subsequently be revised during the year in response to ongoing developments, including as a consequence of decisions made in year about service change by the IJB such as an overspend forecast in either of the operational budgets for health or social care services delivered by the Council or NHS Lothian. The Directions log issued does not highlight delivery issues and the total resource committed. There is not a clear link between the Directions issued and the budget allocation as the funding is allocated to each service areas. In addition, the Directions for 2023-24 were issued before the budgets from the partners were agreed. The 2023-24 budgets were agreed later in the year and the MIJB was also presented with financial recovery options but there were no revisions made to the Directions during the year. There is a risk that the partners are not engaged in delivering Directions as not enough resource detail is given when the Directions are set. Low 1.3 MIJB should consider linking Directions to the funding allocations; and address any delivery issues in the Directions log. MIJB should consider issuing out revised Directions during the year in response to ongoing financial developments. Management response Responsible officer & target date 1.3 Directions are the mechanism to action strategy so by their nature need to be cross cutting over a number of service areas and therefore identifying the funding allocation issue by Direction is impossible. There was operational decision making at HSCP level but no further implication for the IJB in June 2023 for Directions and so there was no need to issue anything further. However, our Directions for 2024/25 do have each of the IJB recovery actions noted with a clear saving target noted against each one. Budgets change nearly every month and the IJB is in receipt of regular financial reports from the partners. 1.3 Chief Finance Officer Complete Page 142 of 184
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8 OFFICIAL OFFICIAL A Recommendation Grading/Overall opinion definitions Recommendation Definition High Recommendations relating to factors fundamental to the success of the control objectives of the system. The weaknesses may give rise to significant financial loss/misstatement or failure of business processes. Medium Recommendations which will improve the efficiency and effectiveness of the existing controls. Low Recommendations concerning minor issues that are not critical, but which may prevent attainment of best practice and/or operational efficiency. Levels of Assurance Definition Substantial Assurance A sound system of governance, risk management and control exists, with internal controls operating effectively and being consistently applied to support the achievement of objectives in the area audited. Reasonable Assurance There is a generally sound system of governance, risk management and control in place. Some issues, noncompliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. Limited Assurance Significant gaps, weaknesses or non-compliance were identified. Improvement is required to the system of governance, risk management and control to effectively manage risks to the achievement of objectives in the area audited No Assurance Immediate action is required to address fundamental gaps, weaknesses or non-compliance identified. The system of governance, risk management and control is inadequate to effectively manage risks to the achievement of objectives in the area audited. Page 143 of 184
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9 OFFICIAL OFFICIAL B Resource, acknowledgements & distribution list Internal Audit Chief Internal Auditor: Duncan Stainbank Principal Auditor: Elaine Greaves Auditor: Amber Ahmed Review Dates Completed By Date Internal Audit Draft Report Submission 16 August 2024 Management Review Completion 26 August 2024 Final Report Issue 27 August 2024 Report Distribution Morag Barrow, Joint Director Health and Social Care Gill Main, Integration Manager David King, Chief Finance Officer Elouise Johnstone, Strategic Programme Manager for Performance, Midlothian Health & Social Care Partnership Roxanne Watson, Executive Business Manager Acknowledgements. The weaknesses identified during the course of our audit have been brought to the attention of Management. The weaknesses outlined are those, which have come to our attention during the course of our normal audit work and are not necessarily all of the weaknesses, which may exist. Although we include a number of specific recommendations, it is the responsibility of Management to determine the extent of the internal control systems appropriate to the IJB Publication Scheme. The content of this report has been discussed with the Integration Manager - HSCP to confirm factual accuracy. The assistance and cooperation received during the course of our audit is gratefully acknowledged. Page 144 of 184
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Midlothian IJB Audit and Risk Committee MIJB Reporting: NHS Lothian Internal Audit Reports for noting. Thursday 12 September 2024 Executive summary This report introduces the NHS Lothian Internal Audit Reports recently finalised that should be noted by the Midlothian IJB. Two recent reports are being brought to the attention of the Midlothian IJB Audit & Risk Committee as they provide appropriate assurance concerning relevant areas of governance. On the 19th February 2024 the NHS Lothian Audit & Risk Committee was presented with a report on IJB Directions which provided a conclusion of Limited Assurance. Whilst the majority of these recommendations have now been implemented this is being presented at the same meeting as the MIJB Directions report to provide further context. Implementation of both sets of recommendations will provide clear governance and control processes on the implementation of Directions. On the 17 June 2024 the NHS Lothian Audit & Risk Committee was presented with an Internal Audit report on Financial Sustainability which provided Significant Assurance. Noting in the headline messages that “NHS Lothian’s financial performance is therefore likely indicative of the broader external financial constraints impacting the healthcare system in Scotland rather than internal control failures.” The report contains 3 low graded recommendations and 1 improvement action. The Midlothian IJB Audit and Risk Committee is asked to: • Note the findings of the NHS Lothian Internal Audit of IJB Directions • Note the findings of the NHS Lothian Internal Audit of Financial Sustainability. Item number: 5.7 Page 145 of 184
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Midlothian Integration Joint Board Report MIJB Reporting: NHS Lothian Internal Audit Reports for noting 1 Purpose 1.1 The purpose of this report is to: • Inform the MIJB Audit and Risk Committee of the NHS Lothian Internal Audit Report on IJB Directions providing Limited Assurance; and • Inform the MIJB Audit and Risk Committee of the NHS Lothian Internal Audit Report on Financial Sustainability providing Significant Assurance. 2 Recommendations 2.1 The MIJB Audit and Risk Committee is asked to: • Note the findings of the NHS Lothian Internal Audit on IJB Directions. • Note the findings of the NHS Lothian Internal Audit on Financial Sustainability. 3 Background 3.1 The Chief Internal Auditor continues to review audit papers for both NHS Lothian and Midlothian Council on an ongoing basis. Where Internal Audit reports may be relevant to the IJB details of these reports are brought forward to the MIJB Audit & Risk Committee to note. 3.2 The NHS Lothian Internal Audit Report on IJB Directions finalised in February 2024 provided Limited Assurance. Specifically, the report concluded that; “The weakest area is related to the documentation of directions received from the four IJB’s”. “Another area of weakness which has received a red recommendation relates to the governance arrangements. No NHS Lothian governance group has been given formal responsibility for the collective review of all extant directions and the Board’s progress in implementing them.” The majority of the recommendations should be completed at the time of reporting and a lessons learned exercise is due in October 2024. 3.3 The NHS Lothian Internal Audit Report on Financial Sustainability finalised in June 2024 provided Significant Assurance. Specifically, the report concluded that “While the report provides significant assurance on the internal processes and controls examined relating to the consistency of financial plan development and the identification of efficiency opportunities within NHS Lothian supporting financial sustainability, it is important to highlight the overall financial position of the board.” All recommendations are due to be completed by the end of December 2024. 3.4 Members should note that both of these reports are operational reports in relation to NHS Lothian and the agreed actions are being resolved and monitored by NHS Lothian Audit & Risk Committee. Page 146 of 184
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Midlothian Integration Joint Board 4 Directions 4.1 There are no Directions implications arising from this report. 5 Equalities Implications 6.1 There are no direct equalities implications arising from this report. 6 Resource Implications 6.1 There are no direct resource implications for the IJB arising from this report. 7 Risk 7.1 There are no direct risk impacts as a result of this report. 8 Involving people 8.1 These reports have been through appropriate management review within NHS Lothian prior to finalisation and are presented here for noting. 9 Background Papers 9.1 Appendix 1 is the full NHS Lothian Internal Audit report on IJB Directions February 2024. 9.2 Appendix 2 is the full NHS Lothian Internal Audit report on Financial Sustainability June 2024. AUTHOR’S NAME Duncan Stainbank DESIGNATION Chief Internal Auditor CONTACT INFO duncan.stainbank@midlothian.gov.uk DATE 3 September 2024 Page 147 of 184
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