Agenda item

The Board had before it the report by Alex Stephen, Chief Finance Officer.

The report recommended that the Board:

(i)            Note the financial allocations proposed to be allocated by the partner organisations;

(ii)          Approve the Bon Accord Contract level for 2019/20 of £27,233,000 and budget assumptions noted in section 3.8;

(iii)         Formally approve the 2019/20 budget and the Aberdeen City IJB Medium Term Financial Strategy included as appendix 1 of this report;

The Board heard that the report indicated that this was an extremely tight budget forecast particulary against the backdrop of a revised funding formula by NHS Grampian by utlising the MRAC formulas.

Final Grant Settlement

The Board were reminded that this formula of funding was not the basis upon which the original funding and budget frameworks were based and that the budget had been set against a background of reduced funding from both partnerships.

The Board agreed that following the previous more positive financial contributions, the Board had been able to deliver positive outcomes against the strategy. It was disappointing that the current position would place additional pressures on the Board and its ability to deliver core services.

The Board conceded that whilst the reduction of Council funding had been predicted, the reduction from NHS Grampian against its revisied formula was not. The Board were concerned that should the basis of funding in future years continue to reduce this would introduce additional risks.

Medium Term Financial Framework

The Board heard that this indicated the challenging financial position to deliver savings year on year against the reductions received. Together with additional funding requirements in several areas this clearly introduced additional risk.

The Board heard that mitigation of the risks included enhanced drive to deliver efficiencies throughout and that industry toolkits were being applied to assist that delivery which introduced a confidence on the probability of delivering savings.

The Board were reminded that the risk fund remained in a healthy position should those funds be required.

Discussion included concerns around the Scottish Living Wage (SLW) and whilst Scottish Government funding presently assisted that delivery, removal or reduction of funds in that area would introduce an additional risk. The Board agreed that as the workforce were key to the delivery of services and efficiencies, it was important that a close watch be maintained on SLW.

The Board heard that the current reduction in prescription costs would hopefully continue and that projections had been made over the next 5/10 years.

This saving was very much linked upon the prevention and care at home strategy projects delivering their anticipated benefits and efficiencies also.

The Board heard that the revised strategy would see greater emphasis on prevention which albeit carrying an element of risk is very much the way forward. The revisid strategy was intended to assist better provision of services and assist greater focus on benefit and efficiency together with digital enhancement to assist.

The Board indicated their pleasure of the volume and nature of work carried out in preparing and presenting the Budget Report and extended their appreciation to the Chief Finance Officer.

The Board resolved to :-

(i)            Note the financial allocations from the partner organisations and that the Chair write to the respective organisations to convey the Board’s concern about the change in basis for funding and potential risks to the IJB’s future financial position should this basis of allocation continue in the future

(ii)          Approve the Bon Accord Contract level for 2019/20 of £27,233,000 and budget assumptions noted in section 3.8;

(iii)         Formally approve the 2019/20 budget and the Aberdeen City IJB Medium Term Financial Strategy included as appendix 1 of this report;

(iv)         Note that the IJB previously agreed to earmark £2.5 million in a risk fund and that this is included in the Medium Term Financial Framework;

(v)          Instruct the Chief Officer to uplift the direct payments for clients with a staffing element included in their payment by 2.8% from the 1 May 2019 to cover the increase in the Scottish Living Wage;

(vi)         Instruct the Chief Officer to negotiate uplifts for those Social Care providers not covered by the National Care Home Contract; and

(vii)        Make the budget directions contained in appendix 2 of this report and instruct the Chief Officer to issue these directions to the constituent authorities.