HULL AND EAST YORKSHIRE HOSPITALS TRUST

ANNUAL GENERAL MEETING

SEPTEMBER 2014

ANNUAL ACCOUNTS 2013/14

Lee Bond Chief Financial

Officer

FINANCIAL PERFORMANCE REVIEW 2013/14The Trust achieved all of its financial duties in 2013/14

To Break Even on its Statement of Comprehensive Income

To Achieve A 3.5% Return on Capital

To Operate Within Our External Finance Limit

To Operate Within Our Capital Resource Limit

BREAK EVEN DUTY

As an NHS Trust we are required to at least break even. For the eighth successive year we achieved an operating surplus.

The £40M we have generated over the last 8 years has been used to repay loans and invest in our property, plant and equipment.We generate surpluses so that we can ensure a sound financial basis for the future particularly recognising the challenging economic environment.

2006/07(£M)

2007/08(£M)

2008/09(£M)

2009/10(£M)

2010/11(£M)

2011/12(£M)

2012/13(£M)

2013/14(£M)

0.2

6.8 5.0 7.6 4.6 4.8 5.4 5.9

HOW DO WE SPEND OUR MONEY

(£M)Pay 295

Supplies and Services - Clinical 113

Supplies and Services - Other 15

Premises 21

Depreciation 14

Establishment Expenses 6

Clinical Negligence (NHSLA fees) 9

Other 16

Total 489

Our expenditure in 2013/14 was £489M (excluding impairments), which can be summarised as:

This year the cost of salaries and wages increased by £1M to £295M.

FINANCIAL FACTS YOU DIDN’T KNOW ……………

WE SOLD 624,000 HOT

DRINKS (RETAIL)

- £599,040

WE BOUGHT 15,000 CUCUMBERS £9,300

EIGHT TONNES OF

FRESH TOMATOES

£14,000

50,000 LOAVES OF BREAD – AROUND

948,000 SLICES£40,500

LINEN AND LAUNDRY: WE USE 1,269,000

SHEETS A YEAR -

£431,460

Investment in InfrastructureWe invested £27.7M in property, plant and equipment

(£M)Building ProjectsNew Emergency DepartmentHull Royal Infirmary (Upgrade to the façade)

ProgrammesBacklog maintenanceOther

EquipmentMedical and Scientific EquipmentInformation technology

TOTAL SPENT

1.66.6

2.910.7

3.62.3

____

27.7____

THE FINANCIAL FUTURE

• We expect demand for NHS services will continue to increase, but funding growth will be limited.

– The “Tariff” (price paid by Commissioners) fell by 1.5% in 2014/15– We expect future years to be similar.– Better Care Fund looking to move minimum 3.5% of our non elective care.– National efficiency requirement of between 3% & 5%

The Trust will need to improve efficiency and productivity to deliver services within the funding available.

THE FINANCIAL FUTURE

• We will need to make changes in the way services are provided.– Clinical Commissioning Groups are looking for services to be provided more

locally,– NHS England are looking to rationalise specialist provision into fewer, larger

centres.

• Our financial plans reflect our desire to provide services locally that are safe, high quality and which meet the requirements identified by the Care Quality Commission. These will include:

– Improvements to our Emergency Department, to our patient record and IT systems, and to our surgical services

– Rationalising elective and non-elective services between the Castle Hill and Hull Royal sites respectively, and

– Replacing essential medical and surgical equipment

IN SUMMARY

• We’ve continued to deliver within the financial constraints we face

• Sound financial management has helped us grow and develop our services

• The impact of the economic environment will continue to set significant challenges for the NHS over the next few years.

• We will need to work collaboratively with commissioning and provider colleagues if we are to successfully meet the challenges faced.