News / Performance good but work still needed, says commission

NHS trust and primary care trust financial performance is good and getting better, but there is room for improvement if the service is to meet the quality and productivity challenges ahead, the Audit Commission has said.

The commission’s 2008/09 auditors’ local evaluation (ALE) scores for NHS trusts and use of resources (UOR) assessment for PCTs – published for the first time this year – show only a small number of organisations performing below minimum standards.

The ALE assessment found 70% of the 125 trusts assessed were performing well or strongly (levels 3 and 4), while only nine had failed to reach level 2 (meeting minimum standards) – 14 trusts fell into this category in 2007/08.

The commission said PCTs had responded well to the new, more demanding UOR assessment. Although no PCT was given an ‘excellent’ rating, 11 scored at level 3 (performing well) in each of the three UOR themes – managing finances, governing the business and managing resources.

Andy McKeon, the commission’s managing director of health, said that with the expected budgetary squeeze it was reassuring that PCTs and trusts had got better at managing their finances.

But he added: ‘The detail also shows that there is room for improvement, particularly if future pressures to maintain quality of service and improve productivity are to be met.’

Individual key lines of enquiry (KLOE) showed that although trusts are good at managing budgets, many of them were not as good at financial planning and managing assets.

More than a third of trusts (37%) performed at minimum standards or worse on KLOE 2.1 on the soundness of the trust’s medium-term financial planning. And 51% did not reach the performing well standard on KLOE 2.3 (the organisation manages its asset base).

PCTs could do more to improve their understanding of costs and the quality of data used for decision-making and performance management, he said. Three-quarters of PCTs scored at minimum standard or below for KLOE 1.2 on understanding costs, while 86% fell into this category on KLOE 2.2 on producing relevant and reliable data.

David Flory, director general NHS finance, performance and operations said: 'We expect the small number of organisations who are not meeting the minimum standards to make sure they address these issues quickly.'

NHS Confederation policy director Nigel Edwards said the results were testament to the hard work across the service. ‘For those trusts where there are still problems there is no complacency – efforts are being made to ensure all aspects of performance continue to improve,’ he said.

Julia Newton, finance director of NHS Sheffield, one of the PCTs that scored a 3 in each UOR theme, said: ‘We are particularly delighted given that the new assessment process for 2008/09 was more challenging than in previous years. While we've done well, we know there is room for improvement before we can achieve top scores and it is this drive for excellence that will be our focus over the coming months.’

Mike Dinan, director of finance at London Ambulance Service NHS Trust, which scored a 4 overall in the ALE assessment, was pleased the trust’s commitment to sound financial planning and value for money had been recognised.

Northamptonshire Healthcare NHS Foundation Trust also received the top rating for the year before it gained foundation status. Audit committee chairman Robert Peto said: ‘This is a strong reflection on how we successfully plan and manage our resources and ensure value for money in all our services.’