HSSD Finances

Electronic Health and Social Care Records funding – amendment

I laid an amendment on behalf of the Public Accounts Committee seeking independent scrutiny of the decision to provide £650k to the Health and Social Services Department to complete the EHSCR project. The big guns were against us that day, not wanting to be scrutinised. It is funny that members can often be heard saying that the Public Accounts Committee should review something that doesn’t involved them, but when it does, can be very defensive!

Sir,

The Electronic Health and Social Care Records project began in 2006 and since that time there has been no update provided to Members by way of a States report as to how it has been progressing.

The original Billet d’État of December 2006 stated that the cost of purchasing a full EHSCR would be £9.7m over the 10 year life of the contract and that capital costs would be £3.9m, with the balance in terms of maintenance and department’s implementation costs, funded from revenue. Members were advised that the revenue costs would be derived from savings, which were estimated would be around £9.65m.

The project board was to be supported by an implementation team drawn from health and social care professionals under the direction of a project manager and supported by the States ICT Director.

The design and implementation stages were due to be completed by 2009 after which the number of staff involved would be reduced to provide ongoing support for the remainder of the contract term.

The project was sold on the basis that it would improve the way clinical care is delivered in Guernsey whilst also yielding much improved health and social care information to support operational management, the quality of clinical services and strategic planning of future health and social care delivery. It was evident at the time that the systems in place were inadequate and out of date and members were advised that there would be financial and non-financial benefits of implementing the system.

HSSD are now requesting a maximum of £650K, or to be more accurate £600k per paragraph 76 and £650k per the proposition,in order to implement the ePrescribing and Children’s Information database. I suspect there are few here who would question why these modules are needed. Indeed these could be key to releasing benefits both of a financial and non-financial nature.

However, the Committee is very concerned that this Assembly is being asked to delegate authority to T&R to undertake a project assurance review without any independent scrutiny. Indeed we have issues in terms of the proposals generally in relation to the role of T&R so far as overall scrutiny  is concerned and I will highlight these in general debate, for now I will focus on this particular bid.

 

Firstly, I would like to thank HSSD members and staff for the presentation that they gave the other week, which was very informative even if it did raise more questions for me that have resulted in this amendment.

So what are the concerns? Well 3 are of a nature relating to the funding itself;

The first it that at the presentation we were advised that GPs records, a stated benefit in the 2006 report would not happen as the GPs did not want to be part of it. Not only does that mean a key deliverable won’t be achieved, but that should in theory have been some savings in project implementation costs.

Secondly, the 2006 report stated that the project implementation costs would be derived from revenue, whereas we are now being asked to give delegated authority to T&R to take the funds from Capital.

Thirdly, the project according to the 2006 report allowed for a contingency which was included in a figure of around £1.2m, including, confusingly, hardware costs.

Such concerns prompted my email to the T&R Minister recently and I would like to thank his  Department for their detailed response. However, the comments made to do not allay our concerns. In particular, the fact that it is made clear that the project has clearly gone over budget.

Those more seasoned members of this Assembly will recall the implementation of the Social Security Benefits system which took 8 years to complete from 1998 to 2006. It too resulted in a key deliverable not coming to fruition i.e. it only delivered the benefits system not contributions system. The total cost of the project was calculated at £9.232m against a budget of £6.187m. PwC were commissioned by the then PAC to report on the project and they provided 30 recommendations for similar IT projects the vast majority being applicable States wide. One such recommendation related to the fact that all costs of particular projects should be identified at the start and specifically ring fenced.

Now this project commenced before that report was published and before significant  improvements were made to the project management process and which are set out in the report we are debating today, together with the latest proposals to improve it further. And it is already evident from the T&R Department’s response that all costs had not been identified or ring-fenced.

In addition, Members may well be aware of the news from Jersey about a similar project that has gone horribly wrong. My counterpart there is quoted as stating;

It’s intention was to digitise and integrate health and social services patient care records but the programme came up short. Moreover, information given to the States Assembly was so poor that States Members may have had little or no idea that the programme came up short.

Does that sound familiar?

The Chair also stated that 2015 would see its HSSD ask for another £12m to finish the job. If and when that request is made, she urged the States, and I quote, ‘to satisfy themselves that project management standards have improved before allocating any more public money’.

Now members might say, fine but T&R say they are going to do an assurance review, that will be ok then. The Committee would like to point out that T&R have been intimately involved with this project from the start with a number of political members on the Project Board since 2006, as well as having the States ICT Director on the implementation team, to name just 2. It is for this reason that the PAC believes that there should be independent oversight of the project assurance review.

Usually the Committee only gets involved in projects after they have reached practical completion, through the commissioning of Post Implementation Reviews. Indeed, as I mentioned 3 weeks ago we will be producing a report on capital projects arising from the findings of these reviews since 2010 in the next few months.

However, given the above reasons we believe that there are sufficient warning signs that the Committee should take some involvement now. We also believe that Members should know the outcome of the review. Whilst it is encouraging that HSSD are asking for £650k and are stating that this is all they will need to reach completion, given the department’s recent track record in relation to financial management, I do believe we need assurance that this is in fact the case and that they will not be coming back asking for more.

I hope Members see the logic of this amendment. Again, I would say we are not questioning the merits or otherwise of implementing the 2 modules but that this should be done with eyes wide open and with some degree of assurance that what the HSSD says it needs, is in fact the case.

 

 

Repeat that the Committee believes that it would add value in two specific ways: firstly through the independent oversight of the project assurance review and secondly, through making Members aware of the outcome that review and our findings.

No, it is not the intention of PAC to ‘undertake’ the review – we understand that there may be other already established groups within T&R and/or the governance of the Project that will be in a positon to do that.

Rather, PAC should be involved in the scoping of the Review, considering the Report once completed and then making public our findings.

Given the length of this project, the fact that similar projects have not gone to plan, the recent experiences in Jersey and the involvement of T&R throughout the life of the project I believe that independent oversight is essential and hope that Members will support this amendment to enable just that.

 

Bowel Cancer Screening

The New Year kicked off with a Motion of No Confidence being put forward by Deputy Mike Hadley against the health and Social Services Department. I spoke on behalf of the Public Accounts Committee.  The purpose was not to comment for or against the motion, but to inform Members of the facts from a financial scrutiny point of view.

Sir, I will be speaking on behalf of the Public Accounts Committee.

However, let me make it very clear from the start that, whilst individual members of the Committee may have their own views on the motion of no confidence the Public Accounts Committee has no opinion on the matter.

The Committee considered it necessary, given the context in which the motion of no confidence was proposed, that we comment in relation to the figures provided in relation to bowel cancer screening and the findings from our recent report into HSSD’s financial management in so far as it relates to the Motion.

I will firstly focus on the financial information recently provided by HSSD in relation to bowel cancer screening.  The Committee welcomes the publication of the internal report on this topic and notes the Department’s acknowledgement that there was an underspend on this budget of £87k in 2012 and £156k in 2013.

Whilst we have had limited time to analyse the information, it is evident to the Committee, that there are questions surrounding both the level of the original budget and actual expenditure.

In October 2011 the States approved, as part of the SSP, a budget of £294k for the first year and then £328k on an on-going basis.  This was based on the business case produced by HSSD. It would be logical to assume that a budget request would be based on the additional costs that would be required to undertake that service.

However, it is clear that not all these costs have been incurred as some elements of the work have been absorbed by existing staff. Whilst it would appear that this has not prevented the service from running, we note the comment that it may have had an effect on workload elsewhere.

However, we do question whether the original budget needed to include the level of pathology costs indicated given that this is a tiny fraction of the annual workload undertaken by the laboratory.

Therefore, we agree with the statement made in the internal evaluation report undertaken by HSSD that the budget allocation included a higher allocation than was actually required, although we don’t necessarily agree that this is because of the reduced cohort. The underspend therefore should be seen in this context.

The Committee noted that the initial business case allocated £45k for an IT system from capital expenditure, but that at present it appears that a system to support this screening requirement has not been implemented and this is causing major difficulties for the staff. There appears to be no reason given in the report why this system has yet to be implemented when it would clearly allow staff to make more effective use of their time. It may also reduce the need for additional staff time should numbers screened increase.

In the initial proposal document it states that there would be a tendering process for the full programme to obtain best value for money and that costs obtained from local tenders would be benchmarked against those available from UK providers to ensure value for money is achieved prior to any contract award. It would appear that such a process was not undertaken. It cannot therefore be assumed that we are getting value for money until that review is undertaken.

The Bowel Cancer Screening service is minor in cost terms when compared to the overall HSSD budget, around 0.3% in fact. But, the issues identified merely serve to confirm the Committee’s findings in its recent report that financial management in the period reviewed had been weak.

However, the Committee found that financial management was improving.  Indeed, one of our recommendations is that T&R should provide an oversight role with a clear focus on enhanced communication. It is therefore encouraging to see that T&R have assisted HSSD in terms of verifying figures, albeit that it has come with certain caveats.

The PAC report into financial management within HSSD made it clear that matters have not been helped by frequent Board changes and, as such we have recommended that during the transition of Board membership, there is a need to focus on knowledge transfer, specifically with regard to financial matters. The Committee is also of the view that more generally there should be financial expertise on all Boards and such a requirement is imperative for a Department responsible for over £100m of annual expenditure.

This particular issue just emphasises the fact that the States of Guernsey needs to determine and prioritise the services it wishes to provide and decide how these will be delivered in the most sustainable manner for the future. Until we do that we cannot be assured that we are getting value for money from our expenditure on health and social services provision.

PAC Review into HSSD’s Financial Management

The Public Accounts Committee published its report into the financial management at HSSD in January 2014. Media release below. Report can be found Review of HSSD Financial Management

 

The Public Accounts Committee is releasing its review of HSSD Financial Management. The purpose of the Review was to consider HSSD management of its financial affairs in 2012 and specifically, the circumstances which led to the Minister’s statement in the November 2012 States Assembly with regard to HSSD’s envisaged £2.5million revenue overspend.

The review examined the management of the allocated revenue budget, the quality of the financial management information produced and the level of financial oversight provided by the Treasury & Resources Department.

It should be noted that a full review of the HSSD financial function has not been undertaken.

The Committee has provided an independent, evidence-based account of circumstances leading to the Minister’s statement, taking a considered view of the issues that had been identified.

The Review Panel comprised Deputy Heidi Soulsby (Chair), Deputy Peter Sherbourne and Mrs Gill Morris.

Deputy Soulsby said:

“The Committee has made a number of recommendations that focus on providing an environment where there is a more rigorous financial management function to improve the quality of HSSD’s decision making process. The recommendations made by the PAC and a number of complementary reports examining the HSSD Financial function need to be implemented promptly to enable more effective management of HSSD resources.

However, in the current economic climate this won’t be enough. Irrespective of the financial management in place, the States of Guernsey needs to determine what services it should be providing and how these will be provided in the most sustainable manner for the future. Until such time, there can be no assurance that we are getting value for money from our health and social services provision”.

HSSD 2020 Vision

I made the following speech during the debate on the HSSD 2020 Vision at the January 2013 States meeting.

 

Sir, I would firstly like to say how useful I found this report in providing a very clear impression of the challenges facing not only the department, but the States as a whole. Whilst many of the problems are well known to many of us,

Whilst I believe it is right to set a timescale I would question the ability to get such structural changes sorted within 7 years, especially given it has taken 2 years to get to this point. It is made clear in the report that HSSD believes that a truly effective health and social care system can’t be created through gradual change and that this will mean considerable work to make sure services are linked financially and contractually.

What is missing here, as was missing at the start of the FTP and that is the absence of any recognition of the importance of the change management process. And, the faster you want to bring a completely new system, the more important that process will be. It will certainly be impossible without the buy-in of every affected organisation internal and external to the States of Guernsey.

I would also like to raise the issue of the States outsourcing work to third party organisations. This has been an issue raised by the Chair of the PAC in the UK, Margaret Hodge. She has voiced serious concerns in the UK about the problems of effective scrutiny where funds are passed to third sector and other external organisations. I would like to echo her concerns and believe there should be a States-wide policy regarding financial reporting requirements placed on organisations as a condition of them receiving public money.

Finally, I would like to advise Members that the Public Accounts Committee will shortly be following up the previous PAC’s review into Secondary Healthcare in 2011 to determine actions taken against its recommendations at that time.

HSSD increased budget authorisation

I made the following speech at the 12 December 2012 States meeting, in my capacity as Chair of the Public Accounts Committee.

 

Sir

Further to the November States Meeting, the Public Accounts Committee met to discuss the Statement made by the Minister of the Health and Social Services Department. A key part of the Committee’s mandate is

“to ensure that proper scrutiny is given to the States’ assets, expenditure and revenue to ensure that States’ bodies operate to the highest standards in the management of their financial affairs”.

The Committee was particularly concerned that information provided by the Minister in the Statement, and in the subsequent question and answer session, raised serious questions regarding the Department’s management of their financial affairs. The letter from the Treasury and Resources Department, appended to this report, further substantiates this concern in concluding that:

“the HSSD does not have an adequate financial monitoring and forecasting regime in place such that expenditure pressures are properly identified and quantified at an early stage and thus allow appropriate action to be taken”.

The Committee therefore resolved that it would, as soon as practicable, undertake a review of the Health and Social Service Department which will consider the standard of financial management in the Department, with particular focus on the information available to monitor and forecast budgetary variances.

The Committee is mindful that the Chief Executive is initiating a review which it is stated will ‘at a minimum, consider the adequacy of financial management within the Department’ and will take this into account when proceeding.

The purpose of the Committee’s review will be not only to provide an independent assessment of the standard of the financial management in place at HSSD but also to produce positive recommendations that could be applied corporately in order to develop ‘best practice’ across the States of Guernsey.

Once finalised, the Committee will circulate to all States Members the review terms of reference. I can also confirm the final report with any recommendations will be made public.

Thank you.



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Email: heidi@heidisoulsby.com