NHS RCHT annual report 2014

Annual Reportand Accounts2013-14

An expanded Emergency Department offers improved privacy and facilities for patients and staff.

2 Royal Cornwall Hospitals NHS Trust - Annual Accounts 2013-14

Contents

1 Trust Profile 5

2 Chairman and

Chief Executive’s Statement 7

3 Directors’ Report 9

4 Strategic Review 15

5 Our People – patients,

staff and partners 27

6 Quality Report 33

7 Our organisational structure 89

8 Remuneration Report 93

9 Summary of Annual Accounts 99

10 Full Annual Accounts 105

Royal Cornwall Hospitals NHS Trust - Annual Accounts 2013-14 3

Over £6.5 million has been invested in West Cornwall Hospital over the last six years, including significant contributions from its League of Friends.


Trust Profile

Royal Cornwall Hospitals NHS Trust comprises

of three hospitals, the Royal Cornwall Hospital

in Truro, St Michael’s Hospital in Hayle and

West Cornwall Hospital in Penzance. It also

provides maternity care at centres in St Austell,

Helston and on the Isles of Scilly as well as a

range of outpatient services, including x-ray

and ultrasound services, at 7 community

hospital locations.

Our Emergency Department in Truro is

a designated Trauma Unit and the Urgent

Care Centre in Penzance provides a range of

emergency care for patients in the far west of

the county. We are building a reputation as an

active centre for research and innovation and are

well established as a teaching hospitals trust as

part of the former Peninsula School of Medicine

and Dentistry and the new University of Exeter

Medical School.

With a turnover of £330 million and around

650,000 patient contacts each year, we provide

services for the majority of the population

of Cornwall and the Isles of Scilly, around

420,000 people (a figure that can double

during the busiest holiday periods). We are

among the biggest employers in the county,

with approximately 5,000 staff. We serve a

geographically remote peninsula and are the

provider of choice for our local population with

our staff having a key influence on the our

reputation within the community.

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Angela Ballatti and Lezli Boswell with former RCHT Chairman, Deputy Lord Lieutenant for Cornwall, Michael Galsworthy and Dr Neil Davidson and Matron Louise Silver, representing the 2013 Extra Mile, Excellence and Innovation Award winning team from West Cornwall Hospital’s Urgent Care Centre.


Chairman and Chief Executive’s Statement2In common with all parts of the NHS and the wider public sector, RCHT is operating in an ever more challenging environment in which it faces rising public expectation and pressure on finances.

This is reflected in the demands placed on our staff as they work to provide care to greater numbers of patients, many of whom have increasingly complex conditions. We are enormously grateful to them all for their continued support, professionalism and flexibility when so frequently faced with unprecedented peaks in activity. A small snapshot of their work was superbly showcased in the nationally broadcast BBC Countryside 999 series following patients at our Urgent Care Centre and Emergency Department.

Quality of care is of course measured in a number of ways including direct patient feedback, patient surveys, clinical audit and most notably independent assessment by the Care Quality Commission (CQC). RCHT was among first Trusts in England to undergo the CQC’s new inspection regime and was given an overall assessment of ‘requires improvement’. The report underlined the strong link between intensity of activity and its impact on quality of care, making the resolution of patient flow difficulties a clear priority for the entire health and social care system across Cornwall and the Isles of Scilly.

Despite the obvious challenges, 2013/14 has also been a year in which we have made progress and celebrated achievement. Our clinical site development programme has continued to deliver investment in new equipment, IT systems and improvements to our ward and clinical facilities, including new theatres, radiotherapy equipment and dementia friendly environments. It was also a year in which we marked the 21st Anniversary of RCHT with events throughout the year culminating in our annual Extra Mile, Excellence and Innovation Awards for staff where we were delighted to welcome RCHT’s first chairman, Michael Galsworthy, to present the awards.

We celebrated, too, the culmination of the hugely successful Phoenix Stroke Appeal which reached its target of raising £500,000 to help us to provide ‘gold standard’ care for stroke patients. In achieving this we must thank all of those who supported the Appeal, including our Leagues of Friends, our media partner BBC Radio Cornwall, and the Appeal Committee under the passionate and energetic stewardship of former RCHT vice-Chairman, Rik Evans. The Appeal leaves a lasting legacy which continues to take our stroke services from strength to strength.

With voluntary groups and organisations set to play an increasing role in our wider communities, supporting initiatives to support the frail and vulnerable, we must once again acknowledge the invaluable contribution our own volunteers and Leagues of Friends make to enrich the day to day life in our hospitals. It was a great pleasure to see our combined Leagues of Friends very deservedly decorated with a Queen’s Award for Voluntary Service.

We would also like to record our thanks of former Trust Board members, including Chairman Martin Watts, for their significant contribution, all of whom are referred to later in this report. Looking to the future have made some key new appointments to Executive and Non-Executive Director roles to build a strong Trust Board, working together with a Council of Governors who remain in shadow mode whilst importantly representing the views of public and staff members.

As we look forward ahead we know there will be no easing of the pressures we face. Quality of care and patient safety will always remain our top priority but we must also find ways to live within the resources available to us. We cannot find the solutions in isolation and our working relationships with partner organisations, and engagement with stakeholders and our community, will be more crucial than ever. Together we will need to make fundamental changes and grasp the opportunities we have to break-down barriers and work more closely to bring about the better integrated services that can reduce admissions and allow more people to receive the care and support they need at home or in the community.

Angela Ballatti Lezli BoswellChairman Chief Executive


Communicating with compassion is at the heart of our CARE campaign


Director’s Report3Compassionate, high quality CARESafety remains the top priority in relation to patient care. We use the national ‘safety thermometer’ to audit how effectively our patients are being assessed in a number of areas to reduce their risk of harm and to promote patient safety, including pressure ulcers, falls, catheter associated urinary tract infections, and venous thromboembolism. We set ourselves targets against each of these assessments and have achieved an overall reduction across the year, with a harm-free average score of 93.5%. More detail can be found in the Quality Accounts section of this report.

Alongside this, RCHT’s CARE campaign has continued to be the focus of efforts to concentrate on the fundamental elements of patient care, namely:p Communicating with compassionp Assisting with toileting, ensuring dignityp Relieving pain effectivelyp Ensuring adequate nutrition

This has been underpinned by the introduction of CARE rounds to routinely and regularly check on patients’ basic needs and comfort. Achievement of this aim is measured through our patient experience survey, alongside the Friends and Family test, enabling ward level reporting and identification of any trends that might need remedial action.

‘How are we doing?’ information boards have been installed in all ward areas which openly display the results of patient feedback as well as other important measures of quality and safety, including infection prevention and ward staffing levels.

Investing in our futureDuring the last year more than £17 million has been invested in new equipment and our buildings, as work to deliver our Clinical Site Development Programme continues.

This has included the completion of a number of major projects including:p installation of five hi-tech integrated laparoscopic theatres and two new laminar flow facilities, p deployment of electronic prescribing across 41 areas, p expansion of theatre direct and creation of a new surgical unit, p integration of paediatric facilities, together with new paediatric recovery facilities in theatres, p a two-phase expansion of the emergency department, p installation of fully digital x-ray facilities, p refurbishment works to create dementia- friendly ward environments.

During 2014/15 a further £18 million will be invested to continue the work to bring about better, more effective and more efficient services. Projects already underway include installation of a new robotic dispensing system in the pharmacy department and replacement of one of the two original radiotherapy treatment machines with a second TrueBeam linear accelerator. This second project has received substantial support in the form of a £460,000 contribution from the Sunrise Trust. This has made possible the purchase of optional extras that will allow oncology experts to maximise the capability of both machines, optimising patient care as well as the potential to expand locally based research.

The Clinical Site Development Programme sets out plans for further developments over the coming years with the next phase of projects already prioritised. These include redesign of the maternity and neonatal services, including the creation of a midwife-led birthing unit at the Royal Cornwall Hospital, and works to modernise facilities for endoscopy and urology services.


Director’s Report

Business ReviewOur financial duties for 2013/14 were achieved. From the overall income of £333 million a surplus of £3.9 million was delivered. This in part has been used to make further repayment towards RCHTs historic debt, which now stands at £19.57 million.

Whilst the Trust earned £1.8 million more income than originally planned, it ended the year delivering patient care worth £5 million for which it was not paid, as a result of constraints in the contract with NHS Kernow. This was clearly of concern and the contract for 2014/15 has been negotiated to remove the cap on income for additional activity.

Further detail on RCHT financial management can be found in the annual accounts and the strategic report sections of this document.

In 2014/15 there is a target to achieve a further surplus of £3.9 million and additionally, to make savings of £14 million as part of RCHT’s ‘2018 programme’ which sets out long term savings plans in line with expected changes to the delivery of services as more care is delivered in community settings.

A growing range of our services are now competing in an ‘open market’ where patients are able to choose from a selection of qualified providers. These include a number of diagnostic procedures and provision of adult hearing aids. To support promotion of these services a new directory was published for General Practitioners. Further work on building relationships and empowering our staff, particularly clinicians, to be ambassadors for our services will continue during 2014-15.

Performance and inspectionsDuring the year RCHT was the subject of unannounced visits to each of the sites where we provide services by the Care Quality Commission (CQC), including those provided at

Penrice Birthing Unit and outpatient services at Camborne-Redruth Hospital. Each of these inspections found our services to be compliant with the standards assessed and identifying areas of good practice, together with others where improvement could be made.

Subsequently in January 2014 we were among the first Trusts in England to undergo the new-style (CQC) inspection regime. Overall RCHT was assessed as ‘requiring improvement’, whilst acknowledging an improving organisation with good leadership and a dedicated and caring workforce. Both West Cornwall and St Michael’s Hospitals were assessed as ‘good’.

The CQC report identified two key areas for improvement. The first of these related to the management and security of patient records. The second required commitment across all health and social care providers in Cornwall and the Isles of Scilly to work together to improve the flow of patients through hospital and community based services.

Many of RCHT’s clinical services are also subject to independent assessment, including its screening services, pathology and transfusion services and others hold quality markers such as the ISO scheme.

The Patient-led Assessments of the Care Environment (PLACE) inspections, covering key areas such as the quality of food and the patient environment saw the Trust achieve some of the highest scores in the south west.

Performance against key quality and patient safety targets is shown in the table opposite and has fallen short of desired outcomes in some areas. Those linked to patient flow reflect the pressures that have been seen as a result of high occupancy rates and delayed transfers of care, as recognised by the Care Quality Commission in its inspection report.


Target Actual performance

Safety Hospital Less than 90 101.17 standardised mortality rate (HSMR)

New never events declared 0 4

Healthcare MRSA bacteraemia 0 1 associated

Clostridium difficile infections

(post 72 hours) 20 41

Access and Emergency 95% 91.78% waiting times department performance

Cancer waits All achieved All achieved against targets (composite)

Stroke Percentage of 80% 71.4% patients who have spent more than 90% of their time in a stroke unit

Quality exception Fractured neck of 75% 76.14% reporting - %age of patients receiving surgery within 36 hours

Venous 95% 96.5% Thromboembolism (%age of eligible patients with a risk assessment

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Director’s Report

PartnershipsRCHT cannot work in isolation and needs effective working relationships with its local health and social care partners. The importance of these have been underlined by the Care Quality Commission in its Inspection Report, making clear the necessity for all partners to work together to effect change if we are to achieve the outstanding standard of care to which we all aspire. It will be incumbent on all partners to play a part in ensuring patients have ready access to care and treatment in the setting that is most appropriate to their needs.

We continue to develop our relationships with Healthwatch Cornwall and Healthwatch Isles of Scilly who have a key role to play in representing the views of local people as well as their independent assessment of the services we provide. Our own Patient Ambassadors and patient interest groups, such as our CHAMPs representing the learning disability patient community also bring a valuable perspective to our current and future service provision.

Increasingly we also work more closely with

other acute providers in the Peninsula to create clinical networks for the delivery of highly specialist services for complex or rare conditions, bringing together multidisciplinary teams to offer patients best treatments and outcomes.

Allied to this is the important link with the Academic Health Science Network which brings together expertise and talent in the South West peninsula to improve the health of patients and the population as a whole by bringing together research, health services and science and technology sectors.

Environmental Performance Indicators and SustainabilityIn recent years RCHT has introduced a number of environment friendly measures including biomass and solar power generation, low energy lighting and improved building insulation. Wherever possible we follow a local purchasing policy and our Cornwall Food Production Unit sources over 70% of our hospitals’ catering supplies direct from local producers or suppliers.

Area Non-financial Non-financial Financial data Financial data metric 2012-13 metric 2013-14 £s £s 2012-13 2013-14

Water 144,444 (m3) 150,002 (m3) £645,390

Imported electricity 17,658,625kWh £1,968,400

Gas 24,556,956kWh £821,749

C02 emissions for 0.37MWh/m2 building energy use

Waste

High temperature 752.5 (tonnes) £315,771 disposal

Landfill waste 664 (tonnes) £184,616

Recycling 289 (tonnes) £16,690

Renewables

Solar generated power 19003kWh £10,261.60

Biomass boiler 700.71mWh* £19,759.57


During 2013-14 we achieved a reduction in gas and water usage of 15.14% and 2.33% respectively, although we saw a marginal increase in electricity use.

Our sustainable development plan is being used to drive forward our carbon reduction activity. Alongside the more obvious developments above, we are expanding the use of technology to provide outpatient consultations to reduce travel and the expansion of telemedicine in areas such as dermatology. We are also using ‘telehealth’ to support patients with long-term conditions.

Information risksWe are required to assess and report information risk and data losses. In 2012-13 RCHT reported 3 losses of data to the Information Commissioner. None resulted in any action being taken against the Trust.We take all incidents seriously and these are investigated in the same way as clinical incident to ensure we learn lessons and take action to prevent similar incidents. All staff are required to complete annual mandatory training on Information Governance covering security and management of patient data.

Board of DirectorsThe Board of Directors brings a wide range of experience and expertise to the governance of RCHT. Full details of current membership and individual board member profiles can be found on page 89 of this report.

During the last year there have been changes to the membership of the board following the departures of former Chairman, Martin Watts; Non-Executive Directors, Douglas Webb, Susan Hall, Mike Higgins and Prof Sir Roger Boyle; and

Medical Director Dr Paul Upton. Nurse Executive Andrew MacCallum, who has been in post since May 2012, was confirmed as a substantive appointment in January 2014.

As part of our progress towards achieving Foundation Trust status, a Shadow Council of Governors was elected by RCHT staff and public members in February 2013.

Looking aheadNationally the NHS is undergoing one of the most challenging periods in its history. There is urgent need to improve standards of care in the wake of the Francis and Berwick reports, alongside significant financial pressure, structural changes and rising patient expectation. At RCHT we will need to develop a better understanding of how quality can drive changes in the way we provide services, whilst reducing cost. There will also be the shift to 24/7 working across many more services in order that patients get the very best care no matter when they are admitted to our hospitals.

Among our key strategic goals for 2014/15 are the implementation of new and better pathways of care for our patients, with a focus on early intervention and avoiding the need for hospital admission wherever possible; upgrading our IT infrastructure including our patient administration system; and further investment in equipment and buildings through our Clinical Site Development Programme.

Together with our staff we will be working to embed our values helping us to bring about the cultural change that will improve patient experience and support increased staff satisfaction and pride in our organisation.

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Accurate and timely record keeping; a key part of providing safe care.


Strategic Report41. Introduction

1.1. The Directors’ strategic report for the Royal Cornwall Hospitals NHS Trust (the Trust), for the year ended 31 March 2014, focuses on the financial activities and financial performance of the Trust highlighting any significant issues within the accounts; and linking these to the key objectives and activities of the Trust for the year. The report also looks forward to the key developments planned for the coming year from a financial perspective.

1.2. The main elements of this strategic report are as follows:

p An assessment of the Trust’s achievement of its key financial objectives and financial performance in 2013/14 and its plans and objectives for 2014/15; p An explanation and analysis of the Trust’s annual financial statements; and p An assessment of the Trust’s financial and operational ‘health’ looking forward; called the ‘going concern’ assessment.

1.3. Summarised financial statements have also been included at Appendix 1 and these provide more detail of income, expenditure and investments during the year.

1.4. The Trust’s Annual Report, which incorporates this strategic report, provides a comprehensive narrative of the Trust’s achievements in 2013/14 and of its plans for the future. The sustainability report is also included within the Annual Report.

2. Nature of the business, objectives, strategies and environment within which we operate

2.1. The Trust is the principal provider of acute, specialist and community healthcare to the people of Cornwall and the Isles of Scilly. The Trust is a medium sized teaching District General Hospital.

2.2. It is one of the most remote acute NHS trusts in England, with the nearest NHS acute trust over one hour’s drive away. Cornwall is recognised to be an area of dispersed communities, with a more elderly population which is growing more quickly than the rest of the country and with significant pockets of deprivation. At the same time, Cornwall is a major tourist attraction, with significant peaks of population occurring during the summer months adding up to 300,000 extra people in the county of around 535,000 residents.

2.3. The Trust operates from three main hospital sites:

p Royal Cornwall Hospital, in Truro, which deals with around 90% of the Trust’s activity p St Michael’s Hospital, Hayle p West Cornwall Hospital, Penzance

2.4. The Trust employed 4,945 members of staff during 2013/14 (4,709 2012/13). Further details on the Trust’s staff and social, community and human rights issues can be found in this document.

2.5. The remuneration report, which forms part of the annual report, contains details of all serving senior managers or directors having authority or responsibility for directing or controlling the major activities of the Trust during the year.

2.6. The Trust formed part of the health service community in the South West Peninsular. From 1st April 2013 the Trust’s performance management was taken over by the NHS Trust Development Agency whilst the Trust remains an NHS Trust.


Strategic Report

2.7. From 1 April 2013 NHS Kernow Clinical Commissioning Group assumed local responsibility for almost all commissioning, except for specialised services and public health. During 2013/14 the Department of Health, in collaboration with all relevant agencies, has set out a vision for Integrated Care, challenging Health and Social Care communities to deliver high quality, compassionate care, with better experience for patients, carers and their families.

2.8. The Trust’s 3 year business plan for 2013/14 through to 2015/16 embraced both the principles of integrated care, and the recommendations of the Francis report, putting patients at the heart of everything the Trust does.

2.9. The Trust has focused on delivering this

by addressing six Strategic Objectives. The Trust’s performance against these objectives is described in section 3 of this commentary and in more detail through the rest of the Annual Report. Underlying these strategic objectives was the requirement to deliver the contractual arrangements with NHS Kernow and other organisations.

2.10. The Trust has subsequently prepared a 2 year operational plan covering 2014/15 to 2015/16 reflecting new TDA guidance and has developed revised vision, values and 4 new strategic aims

2.11. The key financial related objectives set out in the financial plan for 2013/14, and linked to the Trust’s strategic objectives, are set out in the following table:

Objective Criteria Achieved

• Deliver statutory financial duties To break even taking one financial year with another, External Financing Limit and Capital Resource Limit

• Ensure financial metrics are at Surplus, EBITDA*, Liquidity the levels required of an FT

• Operate as a Going Concern Surplus, EBITDA*, Liquidity

*Earnings before Interest Taxation Depreciation and Amortisation

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3. Developments and performance of the Trust’s business during the financial yearKey financial performance in 2013/14

3.1. This section sets out the key financial information covering the 2013/14 financial year.

3.2. During 2013/14 the Trust delivered its statutory financial duties:

p the Trust delivered a surplus of £3.9m, p operated within its External Financing Limit as set by the Department of Health (DH) and p operated within its Capital Resource Limit as set by the DH. 3.3. The Statement of Financial Position (balance sheet) shows net assets of £142m. The Trust has carried out a detailed assessment to satisfy itself that it continues to operate as a going concern.

3.4. During the year the Trust made repayments of £1.63m against its historic debt loan reducing the remaining debt to £19.57m (from £21.2m). Whilst the terms of this debt require its repayment in 2014/15, the Trust has received confirmation from the Department of Health that a new loan, payable over a longer period, will be made available to the Trust to replace the existing one at the point of achievement of Foundation Trust status. Until this point, the Trust agrees the in-year debt repayments and these are set at £1.64m for 2014/15.

3.5. The Trust also made loan repayments totalling £572k against its two other loans of £2m each which were received during 2012/13. One related to revenue support and was linked to the Trust’s Foundation Trust application, and one related to capital investment. These two loans are both repayable over a 7 year and 1 month term.

3.6. During 2013/14 the Trust had approval from the Department of Health for a new Capital Investment loan of £5m. £1.5m of this loan was drawn down in March 2013, with the remainder to be drawn down in 2014/15. Repayments of the loan will not commence until the final draw down has taken place.

3.7. In 2013/14 the Trust earned £333m income from activities and delivered a surplus of £3.9m, in line with the financial plan.

3.8. Whilst the Trust earned £1.8m more income than originally planned, it ended the year by delivering activity worth £5m for which it was not paid and incurred significantly higher cost than it originally anticipated. As a result, the Trust was unable to make the additional investment in services it planned.

3.9. During the year the Trust re-valued its tangible information technology assets. The valuation at 31 December 2013 was undertaken on a market value basis. The resultant impairment was charged to the Statement of Comprehensive income (£6.175m) and the Revaluation Reserve (£0.211m).

3.10. During the year the Trust also revalued its land and buildings in order to ensure that the assets were included on the Statement of Financial Position at an up to date valuation. This resulted in impairments of £5.141m which were charged to operating expenses in the year.

3.11. The Trust was unable to meet its cumulative breakeven duty in 2013/14 due to the level of deficit reported in 2005/06. In 2008/09 the Trust agreed a recovery plan with NHS South (now the NHS TDA) to breakeven on a cumulative basis by 31 March 2013. This plan was linked to the repayment of the Trust’s historic debt and resulted in planned surplus levels to correspond with loan repayments. The Trust has revisited its financial plans over

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Strategic Report

the medium term to reflect updated financial planning assumptions and the expected re-scheduling of historic debt. If the Trust achieves annual surpluses of £3.9m, the Trust will achieve breakeven on a cumulative basis by 31 March 2016.

3.12. The Summary Financial Statements in section 9 provides more information on the Trust’s income, expenditure and assets.

Corporate performance

3.13. The Trust set out its key objectives for 2013/14 in its three-year Business Plan, which was approved by the Board in May 2013.

3.14. The Trust identified 6 key corporate objectives for the year:

p To focus relentlessly on quality of care and patient safety. p To value and improve the working lives of our staff, promoting education, training and research. p To remain the preferred provider of acute, specialist and community healthcare to the people of Cornwall and the Isles of Scilly. p To work as a constructive partner in the community, promoting the integration of health and social care. p To work towards a sustainable, low carbon future. p To deliver financial surplus annually.

3.15. The Trust identified five priorities to focus on in 2013/14 in order to achieve these objectives.

PRIORITY FURTHER INFORMATION

• Quality and People Achieve consistently high standards of care, provided by highly skilled and motivated staff, thereby recognising the link between quality services and morale of staff.

• Offering our population a choice Offering choice of high quality accessible services. Successfully support staff to implement innovate service developments and communicate better with the Public, stakeholders and GPs. The aim is to grow referrals for elective services and thus increase the resources to reinvest in NHS services for patients today and tomorrow.

• System wide reform Work with NHS partners, responding to the national challenge to deliver more integrated care, underpinned by patient friendly pathways, reduce non-elective activity through the fundamental redesign of the Urgent Care Pathways and develop alternative modern elective services more appropriate to patients needs, continuing to develop services closer to patients’ homes wherever possible.

• Service innovation and Deliver a 24/7-service model in accordance with commissioners’ plans, facilities redesign underpinned by workforce planning to support service change. To maximise opportunities presented by new improved physical environments through the delivery of the Clinical Site Development Plan (CSDP) and expand Research, Development and Innovation across the Trust.

• Delivering financial stability Achieve activity target and income targets whilst meeting cost improvements, investment in key quality developments such as increased number of users and invest in infrastructure to secure financial and quality returns.


4 KEY PERFORMANCE OBjECTIvES FOR 2013/14

To focus relentlessly on quality care and patient safety.

p During the year the Trust has focused on the following three dimensions of quality – patient safety, clinical effectiveness and patient experience.

p During 2013/14 the Trust retained its unconditional registration with the Care Quality Commission (CQC) – the maximum possible achievement.

p The CQC published four reports on the Trust on 27 March 2014 which had an overall rating of “Requires Improvement” but which gave a strong sense of an improving organisation, good leadership and a caring workforce. West Cornwall Hospital and St Michael’s Hospital were both rated “good”. An action plan is being developed to address all concerns raised.

p A relentless focus on the quality of patient care and safety is, and always will be, the Trust’s highest priority.

p There have however been three cases of MRSA bloodstream infection during 2013/14.

p There have been 41 case of C.difficile for 2013/14, which is over the Trust’s annual tolerance. The Trust continues to strengthen its efforts around antimicrobial stewardship and continues to monitor compliance with antibiotic prescribing, introducing an escalation process in the event of non-compliance. Since the increased focus on antimicrobial stewardship commenced in December, the number of C.difficile cases per month has reduced.

p The proportion of stroke patients who have spent 90% of their time in the stroke unit for the year is 71 %.

p The Trust has met all quarterly cancer wait targets during 2013/14.

p The Trust monitors the number and type of complaints received each month. During 2013/14 complaints have primarily focused on patients being unhappy with the outcome of their care as well as waiting times being too long.

p The NHS Safety Thermometer data is presented as a ‘harm-free’ care rating and has become an important benchmark for those collecting data at the point of care delivery. The Trust has been collecting data since 2012/13 and is showing a stable picture with harm free care of between 90-96% for the current year.

p In January 2014, NHS England and the newly launched National Patient Safety Alerting System (NPSAS) introduced an improved three-level system for highlighting patient safety and risks in NHS Organisations. By April 2014, NHS England will begin to publish data monthly on their website about any trusts who have failed to declare compliance with NPSAS alerts by their set due date. Failure to comply is likely to be used by the CQC in their Intelligent Monitoring System and as an integral part of commissioners’ responsibilities for improving quality. During 2013/14 the Trust has put in place an agreed mechanism for confirming the effective implementation of alerts, together with an agreed ‘sign-off’ process.

3.16. Significant progress has been made against many of these objectives. This progress is summarised in the table below and in more detail in the main body of the Annual Report:


Strategic Report

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KEY PERFORMANCE OBjECTIvES FOR 2013/14

To remain the preferred provider of acute and specialist healthcare to the people of Cornwall and the Isles of Scilly.

p In order to meet this objective the Trust recognised that it needed to maintain the confidence of its patients, local GPs and its commissioners. This meant ensuring high quality facilities; ensuring patients’ experience efficient booking and pre-operative assessment and delivering accessible services both in terms of location and waiting times.

p During 2013/14 the number of same sex accommodation breaches remained low with only 6 breaches. This compared to 10 breaches in 2012/13.

p The Department of Health introduced the Friends and Family Test to enable Trusts to obtain regular and timely feedback from patients about their care and treatment, encouraging organisations to take ownership of the results and action the feedback.

p The Trust reports monthly to its Board on its Friends and Family scores. The Trust had a score of 70 out of target score of 50 for the likelihood of recommendations to friends and family of inpatient stays on the wards. The score for the Emergency Department was lower at 48 out of a target of 50, this low score for the year was a result of a difficult start to the year, scores for the second half of the year have either been on target or exceeded target.

p Continuing to ensure patients receive prompt access to services with minimal unwanted waiting was a key objective for 2013/14. The Trust met 4 out of the 5 national targets each month for 2013/14, with each of the overall standards met for admitted, non-admitted, incomplete and diagnostic pathways. However specialities within the Trust struggled to meet one or other of these targets. The speciality level target is the most difficult to consistently achieve for most Trusts.

p For 2013/14, the main performance target for the Emergency Department is a 4 hour arrival to disposal time for greater than 95% of patients. The Trust failed to meet the 95% target for 11 out of the 12 months of the year, averaging 92% compliance. The Trust has focussed relentlessly to improve compliance, key to this has been the opening of the expanded Emergency Department and continuing to press health and social care partners to focus on the timely discharge of patients.

p The Trust is working towards achieving Foundation Trust status allowing the Trust increased freedom and flexibility to manage its provision of service.

To work as a constructive partner in the community, promoting the integration of health and social care.

p The trust has worked closely during the year in partnership with other organisations to ensure improvements in the quality of care delivered. Developments of patient care pathways are key to ensure that integrated services for patients are delivered. The aim has been to provide as much of the pathways as close to the patients’ home as possible, as well as living within the tight public finance constraints.

p The Trust completed construction work on the redevelopment of the Emergency Department site during the year with a single point of access for emergency admissions and to work across organisational boundaries on admissions avoidance and early discharge.


4 KEY PERFORMANCE OBjECTIvES FOR 2013/14

To value and improve the working lives of our staff, promoting education, training and research.

p There is an evidence base linking, and correlating, highly trained, motivated, well managed and engaged staff with the quality of patient care and lower mortality rates. Investing in leadership, training, health and well-being, effective communication, with opportunities to be involved in research and education will translate into a more motivated effective workforce who will provide an excellent experience for our patients.

p The Trust Board established the Extra Mile (Innovation and Excellence) Awards in 2010 to recognise the many examples of RCHT staff achieving outstanding levels of service to the Trust and a way in which staff feel more engaged and better rewarded for their work. Staff have continued to embrace the awards during 2013/14 with an increased number of nominations year on year.

p The annual staff survey allows the Trust to develop a workforce plan to ensure staff are engaged, have effective ways of working, developed as leaders and managers, where appropriate, and ensure there is a culture of performance and accountability within the Trust. Whilst the results of the 2013/14 staff survey showed the Trust was heading in the right direction, the trust remained well below the national average on many indicators. The results of the current survey are being analysed to allow the Trust to work with team on the issues that are most important to them.

p The Trust’s listening into Action programme was re-focused during the year, re-energising its approach. During 2013/14 a number of Executive led events have taken place, specifically focused upon issues raised by staff.

p The Trust has continued its role as a teaching provider through is partnership with the University of Exeter Medical School and Plymouth Universities Faculty of Health and Human Sciences and Peninsula School of Dentistry.

p The Trust acknowledges that research is a core activity with many of its Clinicians being involved in leading edge research to ensure that breakthroughs bring about clinical benefits as soon as possible.

To work towards sustainable, low carbon future.

p During 2013/14 the Trust has been working to raise awareness of sustainability at all levels in the organisation so that staff are empowered to feed into the sustainable development of services. The Trust recognises that tackling climate change and moving towards a more sustainable future will provide healthcare and wider social benefits.

p During 2013/14 the Trust continued to implement its Sustainable Development Management Plan and is the main focus of attention in working towards a low carbon future. (Treasury guidance on sustainability can be found at http://hm-treasury.gov.uk/frem_sustainability.htm)

p The NHS Carbon and Energy Fund was established to allow NHS bodies opportunities to explore opportunities to invest in energy infrastructure upgrades at no additional revenue or capital cost.

The Trust has been working closely with the NHS Carbon and Energy Fund since 2011 and planning works for a new Energy Centre are progressing well. It is anticipated that the new Energy Centre due to be completed in 2014/15 will lead to considerable CO2 emission reductions.

p The Trust’s sustainability report is presented separately to this document as part of the Annual Report.


Strategic Report

KEY PERFORMANCE OBjECTIvES FOR 2013/14

To deliver financial surplus annually.

p The Trust delivered a retained surplus of £3.9m. This was achieved through the delivery of financial savings of c£14m during 2013/14.

p The Trust has now embedded long term financial modelling and this has enabled the Trust to project savings requirements to 2018, develop savings schemes over the medium term and produce a 15 year capital programme.

p Financial support to the Trust’s non finance managers continues to be strengthened through improved training provided by the Finance Department.

p The Trust has received confirmation from the Department of Health that at the point of achievement of Foundation Trust status its remaining historic debt loan will be re-scheduled over a longer period.

Benefits from capital investment during 2012/13

3.17. Despite the financial challenges facing the Trust it has delivered considerable improvements in its infrastructure through its capital programme in 2013/14, spending £17.2m on estate projects, estate improvements and medical and information technology equipment. The Trust was successful in several central capital Public Dividend Capital investments receiving £895k for the Dementia Friendly Environment improvements, £215k for improvements to the Birthing Experience, and £394k from the Safer Hospital Safer Ward Technology Fund.

3.18. The Trust delivered a significant number of key capital schemes in 2013/14 including:

p Purchase of Medical Capital Equipment - £2.3m p Paediatric Ward and Theatre Improvements - £0.8m p Improvement of the Emergency Department - £2.7m p Redesign of Trelawney Theatre - £1.2m

p Laparoscopic & Trelawney Theatres - £0.8m p Health informatics developments - £3.4m p Redesign of the new St Mawes & Pendennis Wards - £1.8m p Adaptions for Dementia Friendly Environment - £0.9m p Preparation for installation of New Linear Accelerator - £0.5m

4. Resources, principal risks, uncertainties and relationships that may affect our longer term delivery of services

4.1. During 2013/14, the majority of the Trust’s activity was commissioned by NHS Kernow and the NHS England (for specialised services). Clinical services were commissioned by Cornwall Council. The change in commissioning arrangements has bought fresh challenges for the Trust in understanding the strategic commissioning intentions of each organisation and then ensuring that the Trust is able to respond accordingly.

4.2. As the Trust operates within a ‘payment by results’ framework, and given the inherent challenge in determining the level of activity


4that the Trust may need to carry out, there is always a level of risk and uncertainty over the exact level of income which will be received. One of the primary outcomes from the close working between the Trust and its commissioning partners is the development of agreed plans setting out the level of service the Trust is expected to provide. This in turn helps the Trust set expenditure levels, improve service design and offer high quality care.

4.3. In addition to working with its commissioning partners, the directors have regular meetings with senior officers, patients and other interested parties across the local health community, including:

p regular meetings with the Chief Executive and Directors of the NHS South and the NHS Trust Development Agency; p monthly contract performance monitoring meeting with NHS Kernow (Kernow Clinical Commissioning Group - KCCG) and attended as required by NHS South representatives; p joint meetings with Cornwall health and social care providers (including Cornwall Council and Peninsula Community Health); p regular meetings with service users’ Local representative groups, including Involvement Network (LINks), Independent Patient Ambassadors and numerous patient groups throughout the Trust; and p regular attendance at the Health and Adult Social Care Overview Scrutiny Committee meetings.

4.4. These forums and successor forums will continue to ensure that the Trust plays a key role in the delivery of healthcare across the local community.

4.5. All of the Trust’s risks, both financial and non-financial, are managed through a Trust-wide risk management system, and ultimately through a framework designed to provide

assurance to the Trust Board. 4.6. The Trust monitors the achievement of these savings very closely within Trust Board reports, in particular the Integrated Performance Report, and the Trust’s Board Assurance Framework.

5. Looking forward : Position of the business in the future, including capital structure, treasury policy and liquidity

5.1. The Trust has entered into a standard national contract with NHS Kernow for 2014/15. This enables the Trust to earn income for activity it delivers with no cap on maximum income to be earned.

5.2. Nonetheless, the Trust and the health community faces significant financial challenges ahead with the expectation that the income to provide healthcare will reduce in the future leading the Trust to work closely with commissioners to ensure that healthcare is provided in the most appropriate setting and for the best value. The Trust’s costs are also expected to increase due to inflationary pressures and the continual need to invest in the Trust’s services to improve patient care and facilities.

5.3. In 2014/15 the Trust forecasts that income of c£329m will be earned and a surplus of £3.9m will be achieved. This will enable the Trust to meet expected debt repayment obligations and continue to improve levels of working capital. However, the Trust needs to make savings of £14m in order to deliver this financial plan (4.2% income). The establishment of the ‘2018 programme’ to develop long term savings plans has enabled the Trust to set plans to achieve these savings levels.

5.4. The capital programme for 2014/15 identified £18m in investment for the year, with a need to borrow £4.5m in order that the


Strategic Report

Trust can make appropriate investments in its site, equipment and information technology systems during the year. Approval for borrowing will be sought from the Department of Health, with loan repayments made from future capital resources. There will be minimal impact on the Trust’s surplus as a result of additional capital borrowing.

5.5. At the 31 March 2014 the Trust held cash balances of £11.8m. This is expected to be maintained during 2014/15.

5.6. The Trust’s cash flow is monitored on a daily basis and cash flow reports presented to the Board each month. As stated earlier in the commentary the External Financing Limit, which is set by the Department of Health and used to control cash expenditure, was achieved in the year.

5.7. At 31 March 2014 the Trust carried loans of £24.2m. Of this, £19.6m relates to historic deficits incurred prior to 2007/08 and the remaining £4.6m relates to loans which form part of the Trust’s re-financing arrangements in preparation for Foundation Trust status.

5.8. The 2014/15 financial plan has been set on the basis that the historic debt loan from the Department of Health will be re-scheduled over a period whereby loan repayments will total £1.63m per year.

6. Summary Financial Statements and an explanation of our annual accounts

6.1. All NHS bodies have a statutory duty to produce annual financial accounts. They are also required to produce an annual report, which describes the key activities and performance for the year. The annual report incorporates the full annual accounts, the Directors Report, the Remuneration Report and this Strategic Report.

6.2. The annual accounts represent the main way in which NHS trusts deliver their obligation to report to taxpayers and service users the results of their stewardship of public money for the year. The board of each trust is required to approve the annual accounts formally, once they have been audited.

6.3. The format of each NHS trust’s accounts is specified by the DH. The content of the accounts is as follows:

Four key statements:

p Statement of Comprehensive Income p Statement of Financial Position p Statement of Changes in Taxpayers Equity p Statement of Cash Flows

Additional information included in the financial statements

p Accounting Policies p Notes to the accounts p Annual Governance Statement p Directors’ Statement of Responsibilities p Auditor’s Report

6.4. Section 3 of this commentary provides key information on the Trust’s performance for the 2013/14 financial year. In Section 9 this report contains a summarised version of the financial statements and provides some background into the some of the key accounting issues facing the Trust in preparing the financial statements.

Key messages regarding the financial statements p The retained surplus after adjusting for impairments and technical adjustments is £3.9m, in line with target. p The Trust spent £16.7m on capital items in the year and operated within its Capital Resource Limit. p The Trust operated within its External Financing Limit.


4 p The Trust has not yet achieved a cumulative breakeven position and does not expect to do so until 31 March 2016. p A capital investment loan of £5m, repayable within 10 years, was issued by the Secretary of State for Health in March 2014. An initial £1.5m of this loan was drawn down in March 2014. The remainder will be drawn down during 2014/15. p The Trust ended the year with a cash balance of 11.8m. p Based on the financial statements the Trust’s financial metrics have improved year on year. The Trust would be at level 4 for Foundation Trust purposes. Performance against the Better Payments Practice Code6.5. The Better Payment Practice Code requires the Trust to aim to pay all undisputed invoices by the due date or within 30 days of receipt of goods or a valid invoice, whichever is later.

6.6. The Trust has continued to make improvements in year on paying its suppliers and, at the end of the financial year, the Trust had paid 94.9% cumulatively of all non-NHS invoices against the Code. This compares with 94.0% in 2012/13. The Trust continues to strive for further improvements to meet the 95% target cumulatively for 2014/15.

6.7. Note 10 to the Trust’s accounts provides details on payment performance.

6.8. The Trust was accepted as a signatory to the Prompt Payment Code during the financial year 2011/12.

External audit arrangements6.9. The Trust’s external auditor is appointed by the Audit Commission. The Audit Commission appointed Grant Thornton UK LLP during 2013/14 to undertake this role for the Trust. The external auditors are required to comply with

the Code of Audit Practice (the Code), which is laid before Parliament on a five year cycle; and the International Standards on Auditing, United Kingdom and Ireland. Through the Code, external audit is set two main objectives:

p to complete the audit of the annual financial accounts and annual governance statement; p to assess whether the Trust has made adequate arrangements for securing economy, efficiency and effectiveness (value for money) in the use of resources.

6.10. The audit report gives the auditor’s opinion stating whether the accounts give a ‘true and fair’ view of the Trust’s financial position for the year and as at the end of the financial year. This opinion includes an assessment of whether the annual report is consistent with their knowledge of the Trust.

6.11. The audit opinion, for 2013/14 was that the accounts do give a ‘true and fair’ view. Accordingly, an unqualified audit opinion has been given by Grant Thornton UK LLP. The external auditors have also concluded that in all significant respects the Trust has put in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources other than with regard to the medium term financial plan. This is the same issue that the auditors reported on in 2010/11, 2011/12 and 2012/13.

6.12. In 2013/14, the Trust’s external audit fees totalled £114,000 compared to £120,000 in 2012/13.

6.13. All audit issues have been reported to the Audit Committee, with significant issues raised to the attention of all directors as required. There is no relevant audit information which the directors are not aware of.


The Friends and Family Test shows that more patients that the national average would recommend our hospitals to others.


Our people – patients, staff and partners

Listening to patientsAcross the year our hospitals have consistently scored above the national average in the newly introduced Friends and Family Test which asks patients if they would recommend our services to others. Scores are assessed in a range from -100 to +100 and are localised at ward and emergency department level. We set ourselves a minimum goal of +50 with results updated monthly and displayed publicly in each clinical area. The average score across the year was 70.

In most areas of the national inpatient and maternity service surveys carried out in 2013-14 patients rate our services ‘about the same’ as those in other Trusts, although women were less satisfied with care in hospital following the birth of their child. Key areas of action have been drawn up in relation to both surveys which will be taken forward in the coming year.

In the national cancer patient survey RCHT saw a significant improvement in patient feedback moving our service to a ranking of 18th out of 155 Trusts in the England.

Alongside this we received around 3500 letters or expressions of thanks. The majority of patients recording their views on the NHS Choices website said they would recommend our hospitals, with both West Cornwall and St Michael’s hospitals maintaining their 5-star ratings and Royal Cornwall 4-stars.

Set against the context of more than 620,000 patient contacts, during the year we received 491 complaints. It is always our aim to learn from any experience that does not live up to our patients’ expectations and each complaint is thoroughly investigated, action plans for improvement put in place and followed-up. Sixteen complaints were referred to the Health Service Ombudsman and of these 3 were partially upheld.

During 2014-15 we aim to further increase response rates to the Friends and Family Test which at ward level we combine with a more detailed patient experience survey. A new patient experience strategy, which includes the continuation of work with patient ambassadors will support our efforts to improve overall patient experiences.

Our staffIn RCHT’s 2013-14 Business Plan we set ourselves an aim to increase the number of nurses and to continue to use the Productive Ward initiative to release more time to direct patient care. A series of successful recruitment days contributed to the appointment of more than 100 additional nurses, including many of those recently graduated through the University of Plymouth’s base at the Knowledge Spa, as well as an increase in the number of midwives.

It was also our aim to see a rise in levels of satisfaction being expressed by our staff in the national staff survey through the implementation of RCHT’s ‘Our People’ strategy. This strategy focusses on effective workforce planning to get the right skills and numbers of staff in place and to support all staff through access to clinical, professional and vocational skills development. In addition it places renewed emphasis on leadership, employment conditions and health and well-being of staff.

For the second successive year the results of the staff survey have shown an improvement, albeit RCHT is still some way below the average for acute Trusts. Work has continued to use the principles of Listening into Action in engaging staff in service redesign and developments and refreshed communication tools, such as Team Talk, a re-styled ‘One & All’ magazine and bulletins have been well received.

5



Listening into Action-style staff engagement was successfully used to develop RCHT’s new organisational values which were launched in January 2014. These are:

p Care + compassion p Inspiration + innovation p Working together p Pride + achievement p Trust + respect

Embedding these values in our everyday work will be a key focus of our communications and engagement strategy throughout 2014-15.

Improving attendance at work through reduction of stress and related sickness was set as key issue to be addressed. Against a target of 3.75% the level of contract hours lost through sickness absence throughout 2013-14 was 4.27%. A number of approaches have been used to reduce absence rates including use of a stress audit tool and improving support for employees. The staff survey has shown a positive decrease in absence related to stress, although the rate is still high when compared to national averages.

Looking ahead there will be significant changes as reflected in our long-term workforce planning, as more healthcare professionals move to support the anticipated increase in community-based services. Within RCHT a requirement for more responsive services will see a growth in the range of services offering 24/7 access with resultant changes to working patterns for many staff.

Volunteers and fundraisersIn June 2013 we celebrated the culmination of the Phoenix Stroke Appeal after reaching our fundraising goal of raising £500,000 towards equipment and resources to provide ‘gold standard’ stroke services for people in Cornwall and the Isles of Scilly. Achievement of our target was made possible through the tremendous support of fundraisers both locally and further afield and our media partner BBC Radio Cornwall, which allowed us to purchase additional equipment for use in RCHT’s hospitals

as well as community hospitals and patients’ own homes. Our thanks go also to the Phoenix Stroke Appeal committee for the passion and energy they put into making this possible.

In a year highlighted by the receipt of a Queen’s Award for outstanding contribution to volunteering, RCHT’s Friends and volunteers have again played a vital supporting role in the delivery of patient care. They have continued to provide a wide range of supplementary services and expanded into new areas such as the emergency department at the Royal Cornwall Hospital.

Our Leagues of Friends have again made significant financial contributions to facilities, equipment and services. Among them being the investment by the Friends of West Cornwall Hospital supporting the refurbishment of the hospital’s main entrance foyer, equipment for the physiotherapy gym and outpatients from the Friends of St Michael’s Hospital and a Fibroscan machine from the Friends of the Royal Cornwall Hospital which has transformed the liver biopsy service provided by the hepatology team.

Our hospitals have also been fortunate to continue to benefit from the generous support of many individuals, community groups, local businesses and charities which have made donations which total in excess of £400,000 and provide support to services across RCHT’s three hospitals.

Pride and achievementThroughout the year our staff have represented RCHT on a national and international stage, presenting research and innovative ways of delivering care.

Among those receiving recognition were obstetric consultants, who were invited to share leadership of a region-wide network taking forward the development of multi-disciplinary simulation training, and RCHT based diabetes nurse specialists who were invited to present their own simulation training package for emergency response to hypoglycaemia to an international audience.


5The 2013 Extra Mile, Excellence and

Innovation Awards built further on the success of previous years with the highest number of nominations to date. More than100 staff received certificates in recognition of their nomination and 34 teams and individuals were chosen as winners in one of four categories. The Awards recognise outstanding contribution and 2014 will be refreshed to reflect RCHT’s new organisational values.

Equality and DiversityWe have set ourselves five objectives towards which we have been working to ensure we consider equality and diversity issues in all aspects of the way we provide services and treat our staff. These are:

p To improve accessible information across services p To become an employer of choice for people from different backgrounds p To mainstream equality and inclusion processes p Support staff and promote their mental well-being p Improve DNA (did not attend) rates of patients

The percentage of non-white BME ethnic groups in Cornwall is 1.8%, compared to only 1% of patients using RCHT’s services, although this may in part reflect a 2% non-declaration of ethnic origin. The largest proportion of patients is aged 70+ but the group most likely to fail to attend an outpatient are those aged between 20 and 29 years.

Among our staff around 75% are female, with just under 50% of this number working fulltime compared to over 83% of men being fulltime workers. Just under 100 staff (1.6%) have declared themselves to have a disability. A breakdown of ethnicity is shown in the chart below.

RCHT has been commended for its work with learning disability patients and were finalists in the national NMC awards recognising the ground breaking work of our liaison team which is now being replicated by Trusts across the country.

Building redesign works on a number of wards and in the emergency department have improved privacy and dignity and new signage and interior design templates are aiding those with vision impairment or memory loss.

n Undefined 7.89%

n Mixed 0.73%

n Other 0.55%

n Black 0.21%

n Asian 1.27%

n White Other 3.11%

n White British 86.24%

Ethnicity Workforce Profile at 30 November 2013



Learning and researchEducation and research are central to our responsibilities as a teaching hospitals trust. We play an important role in the clinical education and training of a wide range of health professionals (undergraduate and postgraduate) including doctors, dentists, nurses, allied health professionals and many other laboratory and technical staff who are vital to the delivery of care.

Learning and personal developmentThroughout 2013/14 we have been proactively supporting and encouraging our staff to develop their skills to provide clear succession plans for our critical roles. Those aspiring to leadership roles have been given access to training and mentoring opportunities.

Working with Unison we have focussed, too on the development of staff in Bands 1-4 with a series of training courses allowing them to gain skills that will enable them to progress their careers.

We continue a major focus on learning at work for existing and new employees and have made a commitment to doubling the number of apprenticeship roles at RCHT during 2013/14. RCHT is seen as one of the leading organisations in Cornwall in the provision of apprenticeships.

Research, development and innovationPatient participation in research and clinical trials increased steadily throughout 2013/14 with a cumulative total for the year reaching

1480, just below the target of 1600. RCHT remains one of the most active recruiting Trusts in the South West.

The time to set up research studies has long been a factor in attracting further studies into a Trust and is a key marker of the effectiveness and engagement of its research culture. The measure is taken from receipt of notification that the site can take part in the study to the permission being granted by the Trust that recruitment can begin. The Trust is targeting 80% of studies being approved within 30 days of first notification and is currently achieving well above 80%.

There continues to be a focus on engagement with commercially sponsored research studies which show a real benefit to both the provision of care to the patients taking part in the study and the provision of cutting edge training offered to clinicians running pharmaceutical trials.

During 2013/14 the Research, Development and Innovation team is being expanded to provide capacity to support a substantial increase in the number of patients signed up to new research trials from 1,400 to 2,500 and to increase the number of commercial studies by 20%.

We have established an Innovation Club for our staff to encourage and help to develop innovative ideas and solutions across the Trust.


A research rich environment brings quicker access to the latest treatments.


RCHT celebrated its 21st Anniversary during 2013/14 through a number of events during the year including a highly successful Open Day and the annual Extra Mile, Excellence and Innovation Awards.


Quality Report

PART 1Chairman and Chief Executive’s statement on behalf of the Trust Board

Welcome to this year’s Royal Cornwall Hospitals NHS Trust Quality Accounts. The report builds on last year’s quality accounts identifying our performance in 2013/14 and our improvement plans for 2014/15.

The Trust celebrated its 21st anniversary with the people of Cornwall and the Isles of Scilly and its partners in health and social care. The occasion was marked with a number of events included a very well attended Open Day along with opportunities for staff to recognise this significant milestone.

During its planed inspection in January 2014 the Care Quality Commission acknowledged our staff as ‘experienced, caring, compassionate and champions for their patients’, with whom patients ‘felt safe’ in our care. Recognising the Trust also as improving organisation we are taking forward all the recommendations in order to achieve a “Good” assessment, leading to the ambition of being rated “Outstanding.” The Trust continues to work towards being authorised as a Foundation Trust and continues to be the preferred provider of acute services for the people of Cornwall and the Isles of Scilly.

‘Our plans 2012 – 2017’ published in July 2012 sets out our commitment to the delivery of excellent patient care.

The information within this year’s quality accounts provides a good insight into the progress made against our objectives. Particular highlights are:

p Significant improvements in how the Trust manages and dispenses medicines, including the implementation of a new major computer system p Increasing the proportion of time that nursing staff spend directly caring for patients p Increasing the efficiency and organisation of wards p Increase in the size, and modernisation, of the Emergency department at the Royal Cornwall Hospital p Enhanced the staff training programme with simulation, designed to meet the needs of staff

In consultation with our staff, service users and stakeholders, the Trust has identified a number of specific areas for improvement for the forthcoming year:

p Improving the morale of staff through developing leadership, embedding values and cultural change. p Increasing the pace on the development of effective patient pathways, prioritising those that will give the greatest benefits in terms of improved care, better health outcomes and patient experience. p Delivering the CQC Hospital Inspection Action Plan, namely healthcare records and operational flow, with our partners. p Extending the number of services offered 24 hours, 7 days a week. This will improve patient experience as well as safety.

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Quality Report

p Ensuring that risk assessments, for example of patients that are vulnerable to falling, are carried out consistently and documented clearly in records. p Improve discharge arrangements for patients as they leave the hospital.

We are pleased to publish our fifth quality accounts and to confirm our personal commitment to providing high quality health care which is safe and effective for the people of Cornwall and the Isles of Scilly.

To the best of our knowledge the information in these quality accounts is accurate.

Angela Ballatti Andrew MacCallumChairman Deputy Chief Executive


6PART 2 PRIORITIES FOR IMPROVEMENTA. Review of 2013/14 priorities for improvement

Patient Safety1. Safety Thermometer; reducing harms

The Safety Thermometer tool was developed and implemented as a national standard across all NHS acute and community trusts in the year 2012/13. The data collection method promotes prevention of harm and patient safety by counting the cost from the patient’s perspective and experience. Organisations are challenged to put changes in place to reduce harm, based on its “harmfree” care rating. Data is presented as “old” harms (patients admitted to the trust with existing harm from the community), “new” harms (or RCHT hospital acquired harm) and “all” harms (old plus new harms).

The Safety Thermometer focuses on reducing harm to patients across the following domains:

p Pressure Ulcers. p Falls. p Catheter Associated Urinary Tract Infection (CAUTI). p Venous Thromboembolism (VTE).

In 2013/14 the Trust committed to:

p Ensure full compliance with the on-going Safety Thermometer data collection for all inpatients. p Achieved. p Reduce the incidence of hospital acquired pressure ulcers. p The incidence of hospital acquired pressure ulcers has fluctuated during the year. The Trust has implemented a lower limb pathway and focused on ward based facilitation of best practise by the tissue viability team.

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Safety Thermometor: RCHT v National Pressure Ulcer Data Feb 2013-2014RCHT All PU RCHT New PU National All PU National New PU Linear (RCHT All PU) Linear (RCHT New PU)


Quality Report

p Achieve a reduction in falls using the fallsafe care bundle and co-ordinating falls reduction with other groups within the Southwest Quality and Patient Safety Improvement Programme. Reduce the incidence of patient falls resulting in harm by 50% from 2009 to 2013. p, In common with other acute care organisations in the South West, falls incident reduction has not been achieved. The fallsafe care bundle and use of links to promote falls prevention has been only partially successful. A focus on learning from falls incidents and reduction in harm from falls has been mandated and actioned by the falls prevention group. An action plan for the next year to include learning, documentation review and use of falls prevention equipment has been agreed.

p Achieve compliance with Trustwide implementation of CARE rounding (Communicate with compassion, Assist with toileting ensuring dignity, Relieve pain effectively, Encourage adequate nutrition) and SKIN (Surface inspection, Keep moving, Incontinence, Nutrition) bundle to prevent falls and pressure ulcers. p, CARE rounding has become embedded in day to day practise on all wards with high risk patients to prevent falls and pressure ulcers. p Implementation of the single system catheter for the prevention of catheter associated urinary tract infection. p, There has been a successful implementation of the single system catheter which reduces to risk of catheter associated urinary tract infection. p Reduce the incidence of combined harm over the four harms identified above. p, There has been a reduction in the incidence of combined harm over the four harms identified above.

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6Clinical EffectivenessPreventing re-admissions from high risk patients

In 2013/14 the Trust committed to continuing to work with the wider heath community and social services to devise new strategies to avoid unnecessary hospital admissions.

Electronic discharge plans (E-discharge)Good progress has been made in increasing the numbers of e-discharge plans sent to GPs within 24 hours of the patient being discharged from the Trust. Between April 2013 and February 2014, the percentage increased from 68.26% to 73.54%.

Electronic Prescribing and Medicines Administration (EPMA)Inpatient EPMA is now live in all inpatient locations in the Trust (with the exception of the Neonatal Unit which will be completed following the Unit’s planned redevelopment. Additionally the Emergency Department is planned to go live in April 2014. EPMA is enabling early identification and rectification of prescribing issues e.g. antibiotic usage outside of guidelines. Electronic ordering of non-stock items significantly speeds up supply, reducing the likelihood of missed doses due to medication unavailability. A similar electronic transfer of e-discharges is being piloted to further expedite the processing of those prescriptions. An enhancement of EPMA was added in March to incorporate VTE assessment making it a mandatory step before prescribing.

Chronic Obstructive Pulmonary Disease (COPD)COPD is the commonest respiratory reason for readmission. We have a good record of caring for patients in the community so that only those in need of acute care are admitted. Alongside this, standardised admission rates are among the lowest in the country. Those patients who are admitted would therefore be expected to be sicker than the national average and this is supported by the Trust’s COPD and Non-invasive ventilation (NIV) audit data. Despite this the Trust’s COPD

readmission rates are very close to the national median. We are striving to improve this through the COPD discharge bundle which is working well on Wellington and we are currently introducing to MAU. It is hoped that this will improve COPD care on discharge. However it must be recognised that by the time a patient with COPD has a hospital admission they generally have very advanced disease with limited life expectancy. Thus readmissions are inevitable and it may be difficult to show improvement using relatively crude measures.

Heart FailureFollowing approval of the ‘Heart Failure Pathways’ business case an additional Heart Failure Nurse Specialist commenced in post in January 2014; there are now two Heart Failure Nurses in post. The ultrafiltration pilot commenced in November 2013 and we have carried out six of the ten planned pilot treatments. Three Consultant Cardiologists have been identified to support the nurse run Rapid Access Heart Function Clinic (RAHFC) which will ensure RCHT meets NICE guidance, providing a two week diagnostic pathway for Heart Failure. This clinic will commence in May 2014. Data submission is ongoing yearly to the Mandatory (NHS Standard Contract reference 26.1.2) NCAPOP (National Clinical Audit Patient Outcomes Programme) National Heart Failure Audit http://www.ucl.ac.uk/nicor/audits/heartfailure and for the period ending 31/03/14 will be completed by 02/06/14.

DiabetesAn improved patient pathway has been developed to increase the number of patients with unstable diabetes who are reviewed by diabetes specialists during any hospital admission. In 2011/2012 176 patient were admitted to the Trust (to the main wards or remained on Medical Admissions Unit (MAU) for more than two days) with hyper / hypoglycaemia / Diabetic Ketoacidosis (DKA). Only 35 (20%) of these patients were specifically seen by a Diabetologist. The Diabetes Best


Quality Report

Practice Tariff (BPT) has been formulated to ensure adequate management of hypoglycaemia and DKA in both inpatients and post discharge. In order to facilitate this we are working to ensure that all patients with unstable diabetes are admitted to the diabetes ward under the care of a diabetologist. To ensure this all patients with HONK (Hyperosmolar non-ketotic scidosis) / DKA or hypoglycaemia should be flagged to the inpatient diabetes team. These patients are then reviewed by the inpatient team and given a specific care plan and a follow up appointment is arranged with a Community Diabetes Nurse and Consultant within three months of discharge as per BPT recommendations. There is now a specific section on the e-discharge document to facilitate this and collate audit data and patient referrals. In addition the DKA protocol has been recently re-written in view of updated guidance and is available on the hospital intranet.

‘HONK - Hyperglycaemic hyperosmolar non-ketotic coma is a dangerous condition brought on by very high blood glucose levels in type two diabetes.’

‘Diabetic ketoacidosis (DKA) is a dangerous complication faced by people with diabetes which happens when the body starts running out of insulin. DKA occurs when the body has no insulin to use, and switches to burning fatty acids and producing acidic ketone bodies.’

Staff health and wellbeingIn 2013/14 the Trust committed to:

Create a safe and healthy working environmentThe Trust worked with the European Centre for Environment and Human Health to better understand stress in the work place and continues to work with a Healthy Workplace Advisor to continue to deliver planned interventions to support the reduction, recognition and management of stress in the workplace. We have seen early positive reductions within the 2013 national staff opinion survey which saw a 4% decrease in reports of absence related to stress

throughout 2013. Although this is a 9% reduction in 12 months, stress levels in the Trust remain high - with 40% of staff reporting stress related absence in the 12 months prior to the survey. Throughout 2013 the Trust has utilised a number of approaches including:

p The introduction of the Health and Safety Executive Stress Audit Tool in a targeted number of areas across the Trust (notably Theatres and Anaesthetics and Women’s Children’s and Sexual Health). p Commissioned the development of a programme for all managers which will launch in May 2014. p The delivery of resilience training in a number of departments with the aim of supporting employees through challenging circumstances.

Planned activity is underway to align named Occupational Health Nursing resources, and divisional Health and Wellbeing Champions to each division that are beginning to support divisionally specific health and wellbeing activity. We have also launched a Step Back to Work Programme which will ensure early support for staff to return to work, reducing feelings of isolation and detachment.

We are also about to launch the induction health and well being employee checklist which focuses on the identification of any health and wellbeing issues in the first six weeks of employment. This will provide holistic advice from the Trust Occupational Health Service to both employees and their line managers to identify any potential issues that might reduce an employees ability to maximise their potential.

Improve physical and emotional well beingThe Occupational Health Team has commissioned alternative therapies such as shiatsu and resilience training to strengthen staff emotional resilience to work and life challenges. Feedback to date has been positive. This is in addition to access to the Trust Counselling Services which have been re-aligned with the Occupational Health Service.


6The addition of a physiotherapist has

complimented the skills within the service and has seen the introduction of a fast track access to physiotherapy for muscular-skeletal injuries. The ability to offer ergonomic assessment of employees within the workplace has also increased.

Enabling employees to access specialised treatment promptly directly impacts their ability to return to work, we have implemented an Employee Support Programme to facilitate rapid access to treatment for staff awaiting specialist opinion. This has included direct referral rights from Occupational Health to dermatology, eliminating the need for the employee to go to their GP for a referral.

The Sexual Health Hub will be launching a drop in session for staff within the Occupational Health Department in the spring, where a range of sexual health and contraceptive treatment and advice will be available on site.

Patient ExperienceImproving the discharge arrangements for patients and reducing unnecessary delays

In 2013/14 the Trust committed to:

p Introduce service improvement methods to improve compliance with delivery of the discharge policy. p Scope and introduce creative multiprofessional discharge training opportunities in areas of discharge practice. p Develop measurement tools to monitor the impact of education on discharge. p Develop and implement electronic information sharing systems to communicate discharge information between care partners.

During 2013/14 there were several initiatives to improve simple and complex discharges:

p In October 2013, the discharge teams were co-located and managed as one team under a new name the Onward Care Team. The

objective being to reduce duplication of work and to promote an integrated way of working. p To increase the number of complex discharges per week there was a whole system agreement with Peninsula Community Health (PCH) that there would be a minimum of 100 complex discharges each week. On average just over a 100 such discharges a week have been achieved since the end of December. p There has been an increase in the number of multi-disciplinary board ward rounds which has improved the planning of discharges. p To improve operational flow within the Trust, escalation protocols with partners have been made more effective.

The Trust has identified this very important aspect of its services as a key strategic aim linked to the whole systems work required by the CQC. As a consequence this will continue to be a key improvement area for 2014/15. Please see page 42 for further details.

CARE campaignWork has continued during 2013/14 to embed our CARE campaign and to improve responses to our patient experience survey, with the aim of a shift in responses from ‘yes, sometimes’ to ‘yes, always’. In the December 2012 survey results the average variability (‘yes, sometimes’ responses) was 11%.

Key indicators:

Increase the ‘Yes, always’ response rate to the CARE questions (halving the ‘Yes sometimes’ rate):

C – Communicating with compassion from 90% to 95%.A – Assisting with toileting needs, maintaining dignity from 92% to 96%.R – Relieving pain effectively from 88% to 94%.E – Ensuring adequate nutrition from 88% to 94%


Quality Report

The targets set within the campaign are very challenging; overall the Trust has achieved a good level of success with a very clear focus on patient care and safety. Positively we have seen a nearly three percentage point increase in the ‘Reliving pain effectively’ questions, to 90.7%, in the remaining three elements of CARE the desired level of improvement is yet to be achieved, although there has been a reduction in the variability of ratings between ‘yes, sometimes’ and ‘yes, always’. The average reported variability of CARE (measured by the ‘yes, sometimes’ response) in December 2012 was 11%. Comparing this to progress a year on, in December 2013 there is a two and a half percentage point reduction in variability of care - to 8.5%, this percentage also mirrors the overall average of variable care over the full year.

The Trust remains committed to working on improving the consistency of CARE, measuring patient experience though this simple survey. Next year we will shift the emphasis to raising awareness amongst our patients of what they should expect from our CARE campaign so that they can help to drive improvement in consistency in all four CARE elements.

B. Priorities for improvement 2014/15Process for agreeing the Trust’s priorities for improvement

A list of priority areas for improvement was circulated to the Trusts stakeholders for comment in February based on the following evidence:

p Engagement during 2013/14 with patients and the public in the community the Trust serves. p Foundation Trust Quality Assessment. p The National Outcomes Framework. p NHS Information Centre. p Commissioning for Quality and Innovation (CQUIN) programme. p National and local patient experience surveys.

p Royal Cornwall Hospitals NHS Trust Business Plans. p Intelligence from internal mechanisms for monitoring the quality of the Trust’s services. Feedback received was used to finalise the priority areas and also to inform the performance review section of these accounts.

Patient SafetyReduction of the Trust’s Dr Foster Hospital Standardised Mortality Ratio (HSMR)

Measurements of survival from hospital admissions are an important marker of the quality of care provided. Comparative national data is published as a Hospital Standardised Mortality Ratio (HSMR), taking into account variations in local populations. Ever safer patient care will reduce mortality and HSMR by condition allows prioritisation of planning. It is of course reliant on data which is accurate, consistent and reflects the national picture to ensure valid comparisons.

‘The Hospital Standardised Mortality Ratio is the ratio of observed deaths to expected deaths for a basket of 56 diagnosis groups which represent approximately 80% of in hospital deaths. It is a subset of all and represents about 35% of admitted patient activity’

Ensuring the Trust’s data is correct

p To ensure record keeping and clinical coding accurately reflect care patient. p To understand and account for local case mix. p To understand and account for local healthcare structure.

Integrate Mortality Review in clinical areas

p Clinical and administration teams to work together to ensure data quality. p Mortality reviews in all clinical areas.


6 p To consider mortality effects across the Trust and develop multidisciplinary action plans.

Service Development, Quality and Safety

p Business plans should be informed by mortality outcomes. p Patient care pathways developed to reduce HSMRs. p Organisational structure and processes to respond to mortality outcomes.

AspirationNo condition with a HSMR >105 with a focus on five specific areas:

p Syncope. p Septicaemia. p Pneumonia. p Rehabilitation. p Non-elective weekend admissions.

Seven day working

As part of its work to further improve the quality and safety of our services, like Trusts throughout the country we are working to expand patient access to a greater range of services and expert clinical opinion seven days a week. It is of course, subject to Commissioner investment but we are actively taking forward a clinically led 3 to 4 year strategy that will make significant steps towards the development of new models of responsive and effective seven day service provision. Our primary objective is to ensure the safety of patients under our care and improve outcomes irrespective of the day of the week.

Our improvement programme priorities for 2014/15 include:-

p Enhanced pharmacy services extending

opening hours across seven days which will support improved discharge processes and experience for patients. p An expansion of our Early Supported Discharge pilot which enabled frail elderly patients to receive ongoing intensive rehabilitation in their own homes promoting their level of independence. p Undertake a comprehensive self- assessment against the national seven day service toolkit to inform future priorities with a specific emphasis on supporting improvements in the emergency pathways.

The two key indicators for this programme are:

p Improve patient experience of discharge from hospital p Reduce length of stay

Implementation of the CQC recommendations in relation to patient records.

The CQC published four reports on RCHT on 27 March which have an overall rating of “Requires Improvement” but which give a strong sense of an improving organisation, good leadership and a caring workforce. West Cornwall Hospital and St Michael’s Hospital were both rated “Good”.

One of the two areas identified for improvement in the form of a “compliance action” was:

p The Trust must ensure patient records are accurate, complete and held securely

The Trust has committed to ensure that by the end of June 2014:

p Healthcare records will accurately reflect, in full, patient care and treatment. p Healthcare records will be held securely and patient confidentiality maintained.


Quality Report

Clinical EffectivenessImprovement in National Staff Survey Results

We know that patient outcomes are affected by levels of staff engagement and wellbeing and understand that a focus on improving how our staff feel about working for us will impact positively on both patient experience and the numbers of staff reporting favourably in terms of recommending the Trust as a place to work and receive treatment. The Trust’s leaders from the Board to ward managers and team leaders have a critical role in setting expectations of values, behaviours and attitudes to support the delivery of patient centred care.

In the last two years, we have seen year on year improvement in a number of scores that show signs of improvement. These include an improved engagement score and more staff recommending the Trust as a place to work or receive treatment; saying that they receive support from their immediate managers and that the Trust is fair and effective in its management of reported incidents. Indeed a number of qualitative comments indicated a better relationship with senior managers, with the Executive Team identified for their increased visibility, support and drive to change.

We do recognise however that despite these consistent improvements, the Trust remains within the bottom 20% of Trusts on these metrics which may reduce the quality of our patient experience.

The Trust Board has approved a comprehensive and overarching Human Resources and Organisational Development Strategy entitled ‘Our People’. The aim of this strategy is to provide a coherent and co-ordinated programme of interventions across a range of areas including Workforce composition, learning and development leadership and health and wellbeing. One evolving element of the strategy will be the activity undertaken to address points of concern arising from the staff survey. Whilst this will remain just one element

of the overarching plan we recognise that, for a number of years, staff have reported feeling that it is more challenging to work at the Royal Cornwall Hospitals Trust than we would wish and that the activity to address this area of concern is of key importance.

During the next 12 months we will be focusing attention on a leadership and management framework that empowers and enables the Trust’s managers and leaders with the skills to motivate and inspire their teams to deliver high quality services. This will also enable the organisation to recognise the talent that we have and develop individuals to their maximum potential.

We will look to fully embed the new Trust values and supporting Behaviours Framework which will underpin much of the wider transformational activity we will look to deliver. Further attention will also be devoted to staff wellbeing. This will not just see the re-design and provision of a proactive Occupational Health Service, but an extension into the role in raising awareness of Public Health Issues. The Trust knows it is a significant employer in the region and has the potential to improve the health and wellbeing of staff and their families through the provision of information, advice and resources for adopting a healthier lifestyle. We will focus particularly on emotional and mental health and wellbeing over the next 12 months through the delivery of internal stress management workshops and a range of activities promoting emotional and mental health and wellbeing awareness.

In the context of seeking to secure positive improvement across the full spectrum of the ‘Our People’ strategy the aspirational and stretching aim for 2014/15 is to achieve levels of performance consistent with those of the median group of Acute Trust scores in a number of specific and key metrics.

A detailed set of metrics have been developed to allow the Trust Board to monitor progress across the lifetime of the Strategy (2013-2018).


6Implementation of the staff Friends and Family Test will enable additional staff opinion census on topics such as health and wellbeing, learning and development, leadership and management and engagement. This will ensure that we are clear on how it feels for staff to:

p Work in their current team. p How satisfied they are with the ability to do their job. p How the organisational climate impacts on their ability to do their job. p How supportive their line managers are. p Levels of stress or emotional exhaustion.

The Trust will deliver a quarterly ‘Our People’ report to the Trust Board (Governance Committee).

Introduction of three new patient pathways

To improve the effectiveness of the way the Trust and local health community see and treat patients, three patient pathways will be implemented for the following conditions:

p Chest pain p Heart failure p Respiratory disease

Chest PainDuring 2014/15 the Trust will implement two new care pathways for patients with chest pain. These will be developed by our Cardiology service in collaboration with our colleagues in NHS Kernow (commissioners of health services in Cornwall and the Isles of Scilly) and primary care (GPs) together with our Emergency doctors in the Emergency

Department (ED) and Medical Admissions Unit (MAU).

The pathways will be based on best practice guidance issued by NICE:

p Elective outpatient pathway for patients with new onset chest pain p Inpatient chest pain pathway which will include rapid discharge by emergency teams with appropriate early cardiology team review

Once in place these pathways should reduce the number of days patients spend as inpatients ensuring safe treatment in an outpatient setting.

Heart FailureDuring 2014/15 the Trust together with colleagues in primary care (GPs) will implement a new care pathway for patients with heart failure incorporating:

Metric 2010 2011 2012 2013 2014 National

staff who would recommend the trust as a place to work or receive treatment 3.06 2.96 3.08 3.19 3.65 3.71

Support from immediate managers 3.52 3.49 3.41 3.48 3.66 3.65

Fairness and effectiveness of incident reporting procedures 3.37 3.31 3.34 3.32 3.52 3.52

% staff reporting good communication between senior management and staff 18 20 19 21 30 30

Please note: the scores for the first 3 metrics are out of 5


Quality Report

p Rapid Access Heart Function Clinic to provide a two week diagnostic pathway p Continuation of the ultrafiltration plot p Heart Failure care bundle

The jointly developed “guidelines for the management of chronic heart failure in primary and secondary care in Cornwall” will be updated to incorporate the care pathway information and reflect changes in national best practice.

“Ultrafiltration is an alternative strategy to diuretic therapy for the treatment of patients with acute decompensated heart failure. It is a tool that can be used to safely remove sodium and water from whole blood at a controlled rate”

Respiratory DiseaseDuring 2014/15 the Trust will continue to implement care pathways for patients with respiratory disease:

p Chest infection pathway p Care bundle for patient with suspected community acquired pneumonia p COPD admission care bundle p COPD discharge care bundle including anxiety –depression screening tool.

“Chest infection” is a general term to over a variety of respiratory infections and not a diagnosis in itself. The “Chest Infection” pathway aims to guide clinicians to a specific diagnosis and appropriate management.

“Chronic obstructive pulmonary disease (COPD) is the name for a collection of lung diseases including chronic bronchitis, emphysema and chronic obstructive airways disease. People with COPD have difficulties breathing, primarily due to the narrowing of their airways, this is called airflow obstruction.”

Patient ExperienceImprove discharge arrangements for patientsGood discharge management is vital to ensure patient satisfaction, bed availability for emergency

admissions and that quality of patient care and outcomes are optimised. The Trust has developed an improvement programme to support informed effective and timely discharge or transfer from hospital. The approach adopted is based on best practice Department of Health guidance, “Achieving timely simple discharge from hospital” and “Ready to go”.

A Discharge work stream will be part of part of a larger Length of Stay Programme Board which will report to the Trust Management Committee.

The critical Key Performance Indicator (KPI) will be to reduce the current average length of stay (LOS) from 3.1 days to 2.5 days. The effect will be to improve operational flow enabling patients to be admitted to the right ward within a clinically safe time.

The main objectives of this work stream are:

p Early intervention with patients who require supported or intermediate care on discharge. p Use of a discharge check list. p Effective communications with individuals and across settings. p Review and audit to inform future planning.

C. Board statements of assurance

These accounts have been developed taking into regard any guidance issued by the Secretary of State which relates to Chapter Two of the 2009 Health Act, the National Health Service (Quality Account) Regulations 2010, the National Health Service (Quality Account) Regulations 2011, the National Health Service (Quality Account) Amendment Regulations 2012 (“the Regulations”) and subsequent guidance provided by NHS England in 2013 and 2014.

During 213/14 the Royal Cornwall Hospitals NHS Trust provided and/ or sub-contracted 80 NHS services.

The Royal Cornwall Hospitals NHS Trust has reviewed all the data available to them on the quality of care in 80 of these NHS services.


6The income generated by the NHS services reviewed in 2013/14 represents 100 per cent of the

total income generated from the provision of NHS services by the Royal Cornwall Hospitals NHS Trust for 2013/14.

Review of our performance 2013/14National Priorities and Existing Commitments

As an aspirant Foundation Trust (FT) the Trust self-monitors against the Monitor standards against which its performance would be assessed if it were an FT. On 1 October the Monitor Compliance Framework was replaced by Monitor’s new Risk Assessment Framework and the Trust’s processes of self-monitoring changed accordingly.

The risk assessment is identified for each quarter for 2013/14 in the table below, with the detail given in the table overleaf.

2013-2014 Q1 Q2 Q3 Q4

Best 1.0 2.0 2.0 2.0

Most likely 1.0 2.0 2.0 2.0

Worst 1.0 2.0 2.0 4.0


Quality Report

Indicators Threshold Timings Q1 Q2 Q3 Q4 Comments

Clostridium Difficile - ‐meeting the Indicator not met for Q 2- ‐Q4Clostridium Difficile objective - ‐ 41 cases compared with 20 ytd 0.0 1.0 1.0 1.0 full year target of 20.

RTT admitted patients. Quarterly assessment; Achieved all year , however,target must be achieved each month to some Specialties worsening.achieve the quarter 90% quarterly 0.0 0.0 0.0 0.0 RTT non - ‐ admitted patients. Quarterlyassessment; target must be achievedeach month to achieve the quarter 95% quarterly 0.0 0.0 0.0 0.0 Achieved all year.

RTT incomplete pathways. Quarterlyassessment; target must be achievedeach month to achieve the quarter 92% quarterly 0.0 0.0 0.0 0.0 Achieved all year.

Cancer indicators (all) Various quarterly 0.0 0.0 0.0 0.0 Achieved all year

A&E: Maximum of 4 hours from arrivalto admission/transfer/discharge 95% quarterly 1.0 1.0 1.0 1.0 Indicator not met for Q 1- ‐Q4

Certification against compliance with Assuranceguidance regarding access to healthcare offor patients with a learning disability compliance quarterly 0.0 0.0 0.0 0.0 Achieved all year.

Quality governance indicators n/a quarterly 0.0 0.0 0.0 0.0 No known material issues.

Third Party Reports n/a quarterly 0.0 0.0 0.0 0.0 No known material issues.

Continuity of services risk rating n/a quarterly 0.0 0.0 0.0 0.0 No known material issues.

Formal CQC regulatory action Warning quarterly 0.0 0.0 0.0 0.0 No known material issues notice for 2013/14. Following an inspection in January the CQC raised issues relating to health records and operational flow against which the Trust is developing an action plan with its partners.

TOTAL NU MBER OF CONCERNS IDENTIFIED 1.0 2.0 2.0 2.0

It will be seen from the table that the main performance difficulties encountered by the Trust in 2013/14 have related to the proportion of patients whose care in the Emergency Department exceeded 4 hours and the number of Clostridium Difficile cases against the Trust’s tolerance.


6Emergency Department (ED) AccessThe national ED target for over 95% of patients’ care in ED to be less than 4 hours in duration was not met for each quarter in 2013/14. Although other factors have also contributed, the main reason for much of the year has been medical patient flow. A number of actions have been put in place to resolve, including:

p Completion and opening of the significantly larger and modernised new department p Continuation of the whole systems Urgent Care Board, which owns the action plan across the health and social care system to minimise delayed discharges and transfers. p Expansion of services during the winter months in line with the winter plan, including 7 day therapies and pharmacy p Opening of a Frailty Assessment Unit as the additional winter capacity p On-going work with Peninsula Community Health and Adult Social Care to make sure where clinically appropriate patients are transferred to community hospitals or return home with packages of care. p Internal actions within the Emergency Department, such as improved breach analysis and increased staffing at peak times.

Whilst performance on the ED target has been below the standard for much of the year, it should be noted that performance has improved on some of the broader supporting indicators, such as levels of ambulance handover delays and the time patients wait before being assessed. These improvements are as a result of a combination of improved internal ED workings and the expansion of size of the department.

It should also be noted that although target performance has been below the 95% threshold since the opening of the new department, patient experience is significantly better as, with greatly improved privacy and dignity and

capacity to care for a larger number of patients at any time.

Referral to Treatment (RTT)/ Waiting TimesWhilst the national standards have been met all year, the progress made over the last 2 years in RTT has not been sustained this year. Because of a combination of an increase in cancelled operations and increased referrals, the number of patients waiting over 18 weeks has increased. However, the national admitted, non-admitted and incomplete pathway standards have been sustained all year and plans are in place to improve the position in 2014/15.

C Difficile and MRSAAs noted above, the 41 cases of C Difficile attributable to RCHT recorded in 2013/14 was above the Trust’s tolerance of 20. However, there was improvement in the second half of the year, with increasing focus particularly on antibiotic stewardship and also on hand hygiene. Of the 41 cases, 25 occurred in the first half of the year and 38 in the first 3 quarters.

There were 3 MRSA bacteraemias during the year. Root cause analyses were undertaken on all cases and the relevant actions taken.

venous Thromboembolism (vTE) Risk AssessmentsThe Trust assessed 96.05% of patients on admission for the risk of VTE during 2013/14, despite the implementation of the new EPMA system making this more challenging to achieve. The national target of 95% was exceeded every quarter.

Delayed Transfers of CareThe level of delayed transfers of care increased slightly in 2013/14 for the third year running. The Trust continues to work with key partners including Peninsula Community Health and Adult Social Care through the Whole Systems Resilience Network to ensure that patients are discharged in an appropriate and timely fashion.


Quality Report

Indicators for CancerThere are several indicators to which the NHS must work for cancer referral and treatment. The data in the Monitor Risk Assessment Framework includes standards which relate to the percentage of patients with a:

p Maximum waiting time of two weeks from referral to the date first seen for all urgent suspected cancer referrals (target 93%). p One month (31 days) wait from diagnosis to treatment: p, For subsequent treatments for all cancers (surgery 94%, drug 98%, radiotherapy 94%). p, Of all cancers (96%). p Maximum two month (62 days) wait for first treatment from either: p, Urgent GP referral (85%). p, Consultant screening referral (90%).

Each of these targets was achieved on a quarterly and full year basis.

Incident Reporting, enabling effective learning, and Never Events

A high incident reporting rate is considered to be an indicator of a safe organisation, where staff feel able to report incidents and near misses from which they are able to continually learn and consequently reduce risk. The total number of incidents reported throughout the Trust during 2013/14 was 12482 compared to 11396 in 2012/13.

During the period 1 October 2012 to 31 March 2013 the Trust’s reporting rate was 6.5 incidents per 100 admissions compared to a median of 6.7 for large acute trusts in the South West. The data for 1 April to 30 September 2013 has not yet been received from the National Reporting and Learning System (NRLS).

The Trust reported 76 Serious Incidents during 2013/14, 2 of which were subsequently downgraded.

The Trust has an approved process for

managing all incidents, including those classified as ‘Never Events’ by the National Patient Safety Agency (NPSA). During the period 1 April 2013 to 31 March 2014, four Never Events occurred at the Royal Cornwall Hospitals NHS Trust. These are listed below by category and date:

1. Wrong site surgery: local excision of incorrect melanoma scar (April 2013).2. Wrong sided hip prosthesis component implanted: patient returned to theatre and correct prosthesis implanted (October 2013).3. Maladministration of insulin: A patient suffered diabetic ketoacidosis (DKA) due to high blood sugars as a result of missed doses of insulin (December 2013).4. Wrong site surgery: removal of a healthy tooth (March 2014).

The incidents were investigated in line with the Trust’s Serious Incident Policy to identify the root cause and immediate actions taken as a result of the investigation. All serious incidents are discussed at the Divisional Quality and Learning Group to ensure organisational wide learning.

1. Wrong site surgery: local excision of in correct melanoma scar. An electronic version of a lesion map is now in place and in use; the Trust has been asked to demonstrate this process to other centres in the South West. Processes for seeking consent and marking of all lesions have been strengthened.2. Wrong sided hip prosthesis component implanted. The investigation identified an increased risk of an incorrect prosthesis component being implanted if components from multiple manufacturers are used. Increased safety checks, training and a review of component storage have been instigated to prevent similar incidents occurring.


63. Maladministration of insulin. The investigation has identified a number of recommendations to improve the care of diabetic patients on feeding regimes including increased training for junior doctors and nurses, new guidelines to be developed and the use of the Electronic Prescribing and Medicines Administration system (EPMA).4. Wrong site surgery: removal of a healthy tooth. Organisations have 60 working days to investigate such incidents; at the time of writing, the investigation into this incident is still in progress.

A monthly programme of Root Cause Analysis training has been in place since January 2014 to ensure effective investigation of serious incidents. This has been supported by an updated Serious Incident Management policy.

Participation in Clinical Audits

During 2013/14, 31 national clinical audits and

eight national confidential enquiries covered NHS services that the Royal Cornwall Hospitals NHS Trust provides.

During that period the Royal Cornwall Hospitals NHS Trust participated in 97% of national clinical audits and 100% of national confidential enquiries of the national clinical audits and national confidential enquiries which it was eligible to participate in.

p 100% participation in the National Clinical Audit and Patient Outcomes Programme (NCAPOP). p 91% participation in “other” (National Clinical Audit Quality Accounts list) national clinical audits.

The national clinical audits and national confidential enquiries that the Royal Cornwall Hospitals NHS Trust was eligible to participate in, and for which data was collected in 2013/14, are listed on the next page alongside the percentage and number of submitted cases for that audit or enquiry:


Quality Report

Audit/Confidential Enquires Acronym Participation Percentage or number of cases submitted

National Confidential Enquiries

Asthma deaths NRAD yes 100%

Alcohol Related Liver Disease (NCEPOD) yes 100%

Child Health Clinical Outcome Review Programme (CHR-UK) CHR-UK yes 100%

Maternal, Newborn and Infant Clinical Outcome Review Programme (MBRRACE-UK) yes 100%

Lower Limb Amputation (NCEPOD) yes 100%

Subarachnoid Haemorrhage (NCEPOD) yes 100%

Tracheostomy Procedures (NCEPOD) yes 100%

Elective surgery 65.7% (Feb 2014 update (National PROMs Programme) yes of 2012/13 data)

Suicide and Homicide in Mental Health NCISH not applicable

National Clinical Audit & Outcomes Programme (NCAPOP)

Acute Coronary Syndrome or 1050 (approximatelyAcute Myocardial Infarction MINAP yes 40%)

Bowel Cancer NBOCAP yes 100%

Cardiac Arrhythmia Cardiac Rhythm Management (pacing/implantable defibrillators) HRM yes 100%

Chronic Obstructive no data collection inPulmonary Disease COPD yes 13/14

Coronary Angioplasty, Percutaneous Coronary Interventions yes 100%

Diabetes (Adult) ANDA yes 100% inpatient audit.

Electronic solution required to participate in the outpatient audit Diabetes (Paediatric) PNDA yes 100%

Emergency Laparotomy data collection period NELA yes open into 14/15

Epilepsy 12 (Childhood Epilepsy) yes data collection period open into 14/15

Falls and Fragility Fractures Audit Programme FFFAP yes 100%

Head and Neck Oncology DAHNO yes 100%

Heart Failure HF yes minimum achieved

Inflammatory Bowel Disease IBD yes 33 (approximately 73%)

Lung cancer NLCA yes 100%

National Joint Registry NJR yes 95%

National Vascular Registry yes 70%

Neonatal Intensive and Special care NNAP yes 100%

Oesophago-gastric Cancer NAOGC yes 100%

Rheumatoid and Early Inflammatory Arthritis yes data collection period open into 14/15


6Audit/Confidential Enquires Acronym Participation Percentage or number of cases submitted

National Clinical Audit & Outcomes Programme (NCAPOP)

Sentinel Stroke National Audit Programme SSNAP yes >90%Falls and Fragility Fractures no data collection thisAudit Programme (FFFAP) NAFBH not applicable yearAdult Cardiac Surgery ACS not applicable Congenital Heart Disease(Paediatric cardiac surgery) CHD not applicable Paediatric Intensive Care PICANet not applicable Psychological therapies not applicable Schizophrenia NAS not applicable

Other national clinical auditsCasemix programme (Adult Critical care) ICNARC CMP yes 100%Emergency Use of Oxygen BTS yes 100%Moderate or Severe Asthma in Children (care provided in emergency departments) yes 100%National Audit of Seizures in Hospitals (NASH) yes 100%Paediatric Asthma BTS yes 100%Paediatric Bronchiectasis BTS yes 100%Paracetamol Overdose (care provided in emergency departments) yes 100%Renal Registry UKRR yes 100%Severe Sepsis & Septic Shock yes 100%?Severe Trauma TARN yes 80-90%Cardiac Arrest NCAA No* Cardiothoracic Transplant not applicable Comparative Audit of Blood Transfusion not applicable Pulmonary Hypertension not applicable Prescribing Observatory forMental Health POMH- UK not applicable

* A business case is underway to facilitate future participation in this national audit.


Quality Report

Reviewing reports of national clinical auditsThe reports of 32 national clinical audits were reviewed by the provider in 2013/14 and the Royal Cornwall Hospitals NHS Trust intends to take the following actions to improve the quality of the healthcare provided.

Below are examples of national clinical audits reports published in 2013 and reviewed by the Royal Cornwall Hospitals NHS Trust:

National Neonatal Audit Programme – report published August 2013

p Results discussed at Trust Management Committee (TMC) – Governance in October 2013 and at a Neonatal Unit Business Meeting. p An additional data capture process has been introduced to record key clinical audit data prospectively for each patient. This will ensure data completeness at the point of discharge.

‘Measuring the Units’ A review of the care received by patients who died with alcohol-related liver disease.

p The National Confidential Enquiry into Patient Outcome and Death (NCEPOD) published this report in June 2013. p The report and local actions were discussed at TMC Governance in August 2013 and January 2014. p A locally modified acute de-compensation of chronic liver disease care bundle is in development. A checklist is included as a guide to ensure that the necessary early investigations are completed in a timely manner and appropriate treatments are given at the earliest opportunity. p A business case has been developed for a seven day specialist alcohol nurse service.

UK Carotid Endarterectomy Audit (part of the National vascular Registry)

p Results from round five of the audit were

published in October 2013 and discussed at TMC - Governance in January 2014.

p The Carotid pathway is working well. Results are the best in the South West and amongst the best in the country.

“Managing the Flow?” - A review of the care received by patients who were diagnosed with an aneurysmal subarachnoid haemorrhage

p The National Confidential Enquiry into Patient Outcome and Death (NCEPOD) was published in November 2013 and discussed at TMC - Governance in January 2014.

p The lead clinician is developing a local pathway to be introduced early in 2014.

National Inflammatory Bowel Disease (IBD) Audit

p The 4th round of data collection ended in January 2014

p Data collection for the biological therapies part of this national audit is continuous but the first biological therapies audit report was published on 29 August 2013.

p Based on the national report biological therapies are safe and effective treatments for IBD that are used to good effect.

p Business cases for a Nutrition Nurse and an extra IBD nurse were both successful and the nurses are in post. The nutritional team is now complete.

p “Hot clinics” will be trialled in early 2014. IBD “hot clinics” will fast track patients from the Emergency Department to CT and scope investigations.

Non-invasive ventilation (NIv), British Thoracic Society (Audit number 2008)

p Results were presented at the Medical Grand Round and discussed at TMC - Governance in August 2013.


6 p A Respiratory High Care Unit has been introduced on Wellington Ward. This is a six bedded area for NIV and other conditions that require monitoring. There is also an outreach physiotherapist available. p A programme of Study Days, “Introduction to Non-Invasive Ventilation” has been introduced.

National Paediatric Diabetes Audit

p The report was published in December 2013 (based on 2011/12 data) and discussed at TMC – Governance in March 2014. p A dedicated psychologist was recruited in October 2012. p A 24 hour advice line has been introduced for patients and a website for patients and carers is planned. p Managing diabetes in school/nursery - nurse-led drop in clinics at secondary schools has been introduced.

Reviewing Reports of local clinical audits

The reports of 205 local clinical audits were reviewed by the provider in 2013/14 and the Royal Cornwall Hospitals NHS Trust intends to take the following actions to improve the quality of healthcare provided.

Local clinical audits are reviewed at Divisional and Specialty audit and governance meetings. Examples of actions resulting from local clinical audits are listed below.

Falls Pathway. Follow up for over 65s presenting to Emergency Department (ED) with Falls

Audit presented at ED and Eldercare educational meetings in May 2013

Actions: p Results shared with the community team at the county falls meeting.

p Results fed back to ED junior doctors at education sessions.

Re-audit of time to CT - based on National Standards for Trauma Units

Results presented at the ED Governance meeting in January 2014

Actions: p A trial of onsite radiographers performing CT began in February 2014. p The aim is to achieve 50% cover by April 2014 with on-going CT training to maintain skills.

Antimicrobial Resistance and Prescribing among Junior Doctors

Results presented to the Medical Grand Round in October 2013

Actions: p Microbiology will organise antimicrobial prescribing training sessions for junior doctors from 2014.

p Results fed back to the Exeter Medical School including consideration on introducing antimicrobial prescribing training in the medical curriculum.

Asthma Audit 2013

Local re-audit of the national audit run by the British Thoracic Society. Results presented at a Respiratory Department meeting in September 2013

Actions: p Local adult asthma guidelines have been updated.

p Development of an asthma care bundle planned by the end of 2014.

p Long term aim - appointment of hospital respiratory nurse to support management of asthma and chronic obstructive pulmonary disease.


Quality Report

Bariatric Surgery Audit

Audit of local practice following the National Confidential Enquiry Report on bariatric surgery published in October 2012.

Local audit presented at a Surgical Governance Meeting in August 2013

Actions: p Good compliance levels. p A two stage consent process is now in operation.

Audit of re-excision rates of vertical Scar Therapeutic Mammoplasty (vSTM)

Results presented at a Breast Surgery Departmental Meeting in June 2013

Actions: p Data supports the continuing use of VSTM as an effective treatment option. p Further data collection planned to confirm the long-term oncological outcomes.

Meningitis against NICE Quality Standards Framework

Results were presented at the Child Health Audit & Guidelines Meeting in September 2013

Actions:

p Nurses informed of need for full set of observations. p A standard approved information leaflet has been introduced for parents. p A petechial rash algorithm is now displayed on the Paediatric Observations Unit.

Peri-operative Management of Laparotomies

Results presented at the Surgical Governance Meeting in May 2013

Actions: p Surgeons and Anaesthetists have devised a laparotomy pathway for emergency patients.

Frequency of Laryngectomy valve Changes

and Documentation of Specific Measures

Results were presented at South West Peninsula Joint Head and Neck Cancer Multidisciplinary Team Meeting in June 2013

Actions: p Record cards to be updated with additional indications - for example ‘centeral leak/ peripheral leak/ not applicable for leak, candida present/not present. p Education sessions introduced for all personnel who change voice prostheses.

End of Life Care for Patients with Multiple Myeloma

Results presented at the Haematology Department Meeting in May 2013

p Plans to create a trigger list for considering end of life planning.

p End of life protocol for multiple myeloma under development.

Research and Development

The number of patients receiving NHS services provided or sub-contracted by the Royal Cornwall Hospitals NHS Trust in 2013/14 that were recruited during that period to participate in research approved by a research ethics committee, was 1419.

Research, Development and Innovation (RD&I) is recognised as core business for the Trust as contributing to evidence based practice and improving the effectiveness of care. RD&I work closely with the Peninsula College of Medicine and Dentistry (PCMD) and the European Centre for Environment and Human Health (ECEHH) as part of the research agenda. RD&I also work in partnership with the Cornwall Partnership Foundation NHS Trust and NHS Kernow.

The Trust continues to strengthen its ties with industry, working directly with pharmaceutical


6and biotechnology companies and contract research organisations such as Quintiles and Parexel. Whilst raising the profile of the Trust the increasing income from external sources has helped ensure our patients get access to the latest drugs, therapies and medical devices.

The Trust had 291 active research studies in 2013/14. The number of participants recruited in 2013/14 was 1294 (network) and 125 (non-network) which shows that there is a trend towards studies that are registered on the National Institute of Health Research (NIHR) portfolio.

Study numbers (by Network specialty area) that have recruited participants in 2013/14:

Network Specialty Study NumbersCancer 33Comprehensive 47Dendron 3Diabetes 7Medicines for children 6Obstetrics and Gynaecology 1Primary Care 1Stroke 7Non-network 11Total 116

72 studies were approved to commence in 2013/14:

Network Specialty Study NumbersCancer 15Comprehensive 23Diabetes 2Medicines for children 4Mental Health 1Neurological 1Obstetrics and Gynaecology 1Paediatrics 2Primary Care 1Stroke 3Urology 1Non-network 18Total 72

Study numbers (by therapeutic area) that have recruited participants in 2013/14:

Therapeutic Area Study NumbersAccident and Emergency 1Cardiology 4Clinical Chemistry 2Dermatology 1Diabetes 1Gastroenterology 8General Surgery 7Generic 4Eldercare 1Genetics/Gastroenterology 1Genetics/Oncology 1Haematology 13Mermaid/Breast 1Neurology 6Obstetrics and Gynaecology 5Oncology 21Ophthalmology 2Orthopaedics and Trauma 1Paediatrics 11Pharmacy 1Renal 6Respiratory 1Rheumatology 7Stroke/Rehabilitation 8Surgery 1Total 116

Of the studies approved in 2013/14 18 were commercial studies and 54 non-commercial.


Quality Report

RD&I continues to work as a member organisation with the South West Local Research Network to ensure all studies are conducted in accordance with the Department of Health’s Research Governance Framework for Health and Social Care (2005, 2nd Ed.) and that clinical trials involving an investigatory medicinal product are conducted in accordance with the Medicines for Human Use (Clinical Trials) Regulations 2004 (MHRA) and subsequent amendments. Risk assessment and feasibility are conducted at an early stage in the approvals process. Systems for identifying delays in giving NHS permissions have been developed and RCHT is working to a target of less than 30 days (15 days from April 2014). The Trust continues to use the NIHR Research Passport System for streamlining approvals for external researchers.

In the last year, with the support of partners in the South West, RD&I have helped local researchers develop grant applications to fund a range of innovative projects that have a direct benefit for patients at RCHT which, in turn, will provide national guidelines for the care of patients. These projects include the work of a Consultant Radiologist in devising a definitive pathway for radiological interventions in urology, based on patient’s preferred outcome and the safer re-use of patient’s own blood instead of donated blood for gynaecological operations conducted by a Consultant Gynaecologist.

The study developed by the breast cancer surgical team, investigating a novel approach to anaesthetic infusion for pain and shoulder function following mastectomy, has been extended to include patients at York Hospital Foundation NHS Trust. Following detailed

interviews with patients and their carers a Cornwall GP and a Research Fellow are now investigating the feasibility of a home-based, nurse facilitated heart failure manual for patients with heart failure and their caregivers.Commissioning for Quality and Innovation (CQUIN)

The CQUIN framework is a national scheme that incentivises providers and commissioners to work together to raise quality and develop innovative approaches to healthcare provision. It does so by making a proportion of providers’ income conditional on the achievement - or progress towards achievement – of jointly agreed goals. These are a mixture of nationally mandated and locally agreed quality improvement and innovation goals.

CQUIN framework 2013/14For 2013/14, the proportion of income linked to CQUINs remained unchanged at 2.5%, equal to £6,090,958. Of this, £5.3 million relates to goals set by our principal commissioner, NHS Kernow, in association with a number of minor commissioning bodies. The balance of £700,000 is attached to the goals set by NHS England, our other main commissioner.

New this year was the introduction of a set of pre-qualification tests that required us to demonstrate that we have made progress towards achieving the aims of Innovation Health and Wealth, Accelerating Adoption and Diffusion in the NHS, the NHS Chief Executive’s report of December 2012 which set out a delivery agenda for spreading innovation at pace and scale throughout the NHS. We were able to satisfy our Commissioners that we had done enough to pass these tests.


6The four nationally mandated CQUIN

goals have accounted for around 25% of the programme. They are:

1. Venous Thromboembolism (VTE): in addition to maintaining our screening performance, we have had to conduct root cause analyses of all VTE events that meet the criteria of a hospital-associated thrombosis.2. Patient Experience: the new Friends and Family Test has replaced the national patient experience survey. As required by the timetable, it was introduced in our inpatient wards and Emergency Department in April, then into the maternity wards in October.3. Dementia: although we have had a number of extra things to do for this goal, such

as publishing our staff training plan, the main focus has continued to be on embedding the FAIR process (Finding people with dementia, Assessing and Investigating their symptoms and Referring for support) into our hospitals.4. Safety Thermometer: here we have had to maintain our excellent record of monthly data collection whilst also seeking to reduce the overall number of pressure ulcers experienced by our patients.NHS Kernow agreed five further, local goals with the Trust. 65% of the CQUIN value was attached to three goals aimed at improving unscheduled and emergency care, reflecting the current national and local high profile of these areas. These were met together with goals relating to community pharmacy and consultant to


Quality Report

Q1 Q2 Q3 Q4

Target 95% 95% 95% 95%

Actual 97.33% 96.33% 95.12% 95.45%

Target No target 100% 100% 100% for thisActual quarter 100.0% 100.0% 100.0%

Target Implement 100% Implement 100% in inpatient in maternityActual wards & ED 100.0% wards 100.0%

Target 15.0% 20.0%

Actual 14.7% 17.7% 19.6% 33.5%

Target As the national data collection framework will not be in place until 2014-2015, this Actual goal cannot be achieved this year.

Target A minimum of 90% of 90% the target cohort in any three Actual consecutive months >90%

Target A minimum of 90% of the patients identified 90% in 3(a) I above as potentially having dementia Actual in the same three consecutive months 100%

Target A minimum of 90% of the patients assessed 90% at 3(a) ii above in the same three Actual consecutive months 100%

Target 100% 100% Deliver training programmeActual 100%

Royal Cornwall Hospitals NHS TrustCQUIN SCORECARD 2013-2014Blue cells indicate paid milestones

venous Thromboembolism (vTE)

1(a) 95% of patients of all adult inpatients to be risk as-sessed on admission to hospital using the clinical criteria of the national tool.

1(b) Root cause analysis to be carried out on all cases of hospital associated thrombosis (assessed through same metrics as 1a).

Patient Experience - the Friends & Family Test

2(a) To deliver the nationally agreed roll-out plan to the national timetable.

2(b) To achieve a 15% baseline response rate in acute inpatient and A&E areas, rising by the end of Q4 to a rate higher than Q1 and a minimum of 20%

2(c) To increase the score of the Friends & Family Test question within the 2013-2014 staff survey, compared with 2012-2013 survey results.

Dementia Awareness & Diagnosis

3(a) i. To undertake case finding for patients aged 75 and over, admitted as an emergency for >72 hours.

3(a) ii. To ensure that identified patients are assessed appropriately.

3(a) iii. To ensure that appropriate patients are referred to specialist services.

3(b) i. To confirm the lead clinician and planned 2013-2014 training programme for dementia.3(b) ii. To deliver the 2013-2014 planned training programme.

1

2

3

NA

TIO

NA

LN

ATI

ON

AL

NA

TIO

NA

L


6

Target Provide 1st 100.0% Provide 2nd 100% biannual biannualActual 97.3 report 3% 100.0% report 100%

anticipated

Target 100% 100% 100% 100% Actual 100% 100% 100% 100%

Target 4.0% 3.5% 3.0% 2.5% Actual 3.4% 4.3% 4.7% 4.6%

Target 5% 5% 5% 5% payable payable payable payable

Actual Joint working to agree and deliver programme

actions has continued throughout the year. 33.5%

Target

Audit commissioned & completed. Actual Report received.

Target

The activity reduction associated with thisActual

CQUIN has been transacted in the activity plan.

Target 5% 5% 5% 5% payable payable payable payable

Actual

Target 15 30 45 60 Actual 6 46 104 77

NA

TIO

NA

LLO

CA

LLO

CA

LLO

CA

LLO

CA

LLO

CA

L

3

4

5

6

7

8

9

Dementia Awareness & Diagnosis

3(c) To undertake a monthly audit of carers of people with dementia, to test whether they feel supported, and to report the results to the Board.

NHS Safety Thermometer

4(a) To collect data on the following three elements of the NHS safety thermometer - pressure ulcers, falls and urinary tract infection in patients with a catheter.

4(b) To achieve a 46% reduction from the 2012-2013 baseline in the prevalence of category 2-4 pressure ulcers.

Unscheduled Care Plan

To produce and deliver agreed actions from the whole system multi-agency integrated unscheduled care programme.

Emergency Department

Commission an audit through MCAP on lessons that can be learned about the urgent care system

Consultant to Consultant Referrals

To reduce the number of referrals made in and between consultant teams for symptoms or conditions/symptoms not directly related to the purpose of the original referral.

Discharge Processes

To improve internal hospital discharge processes and standards.

Community Pharmacy Referrals

To increase referrals to Community Pharmacies on discharge.

Evaluation completed and improvement plan formulated and agreed with KCCG.


Quality Report

Q1 Q2 Q3 Q4

Target 100.0% 100.0% 100.0% 100.0%

Actual 100.0% 100.0% 100.0%

Target 60% 65% 70% 75% Actual 100.0% 100.0% 100.0% 100.0%

Target 70.0% 70% 74% 78%Actual 80%

Target 100% 100% 100% 100%Actual 100%

Royal Cornwall Hospitals NHS TrustCQUIN SCORECARD 2013-2014Blue cells indicate paid milestones

Quality Dashboards

To implement the routine use of clinical dashboards in - Radiotherapy - Renal Replacement Therapy - Cystic Fibrosis - Haemophilia - Neonatal Intensive Care

Radiotherapy

To increase the proportion of patients receiving inverse planned IMRT with level two imaging, i.e. IGRT.

HIv

13(a) To increase the proportion of HIV patients registered and disclosed to their GPs.

13(b) To demonstrate a minimum of annual communication with all of the patients identified at 13(a).

10

12

13

NH

SEN

HSE

NH

SE

The CQUIN programme has continued to encourage and drive service improvements. This year’s highlights include:

p Development and implementation of root cause analysis of all qualifying incidents of hospital-associated thrombosis. p Successful implementation of the Friends & Family Test. p Sustained success in the monthly collection of data for the NHS Safety Thermometer. p Development of a new service in which the RCHT pharmacy advises a patient’s regular community pharmacy when the patient is about to be discharged from hospital. Part of obtaining the patient’s consent to this is to explain the potential benefit of discussing their medicines with

their pharmacist soon after discharge. p Successfully ensuring that all radiotherapy patients receiving inverse planned intensity-modulated radiation therapy (IMRT) do so with level two imaging, i.e. they receive image-guided radiation therapy (IGRT). p Maintenance of a high level of patient- consented communication with General Practitioners about HIV patients. The nationally mandated 46% target on new and old pressure ulcer reductions was not achieved. However, the Trust has continued to take actions to reduce new pressure ulcers.

CQUIN framework 2014/15The Trust is currently in the process of agreeing the CQUIN goals for 2014/15 with NHS Kernow.


6How the NHS regulator, the Care Quality

Commission, views the quality of our servicesRegistration with the Care Quality Commission Essential Standards of Quality and SafetyThe Royal Cornwall Hospitals NHS Trust is required to register with the Care Quality Commission and its current registration status is unconditional.

The Care Quality commission has not taken any enforcement action against the Royal Cornwall Hospitals NHS Trust during 2013/14. Two compliance actions were issued following a planned review visit in January 2014.

Care Quality Commission Planned Review visitsThe Care Quality Commission (CQC) has published four reports on the Trust following an inspection in January 2014. Our overall rating is “Requires Improvement” which is a fair assessment and which also gives a strong sense of an improving organisation, good leadership and a caring workforce. West Cornwall Hospital and St Michael’s Hospital were both rated “Good”.

The CQC is clear that RCHT is well-led, caring and effective. They said we must make improvements though in our management of patient records to ensure they are accurate, complete and held securely and also in the way we manage pressures and shortfalls in capacity - specifically “in partnership with commissioners and all the other providers, who share responsibility for the effectiveness of health and social care services”.

The CQC said there was a “strong team spirit within the Trust”, that staff “were proud to work for the Trust” and staff were “experienced, caring, compassionate and champions for their patients.” The CQC also said that patients “felt safe” in our care. We welcome this independent report on our progress and will take action immediately to ensure we can be assessed as “Good” later in 2014 and then engage with staff

and partners on our long term ambition to be “Outstanding.”

A robust action plan is under development jointly with our commissioners and health and social care partners to address the issues raised.

The CQC visited the Trust earlier in the year as part of its previous assessment regime. They visited all of the Trust’s registered locations: Royal Cornwall Hospital, West Cornwall Hospital, St Michael’s Hospital, Penrice Birthing Centre and Royal Cornwall Hospital Headquarters (this refers to the services we provide in the community for example outpatient appointments and x-ray departments at community hospitals). The CQC found the Trust to be compliant with all the outcomes assessed at all locations visited.

NHS provider periodic reviewThe CQC did not visit the Trust in 2013/14 as part of its periodic review programme.

Data Quality

The Trust’s Data Quality Strategy has been reviewed by the Records Services, PAS & Data Quality Manager and will be incorporated into the Records Management Strategy, as a combined strategy, as they are intrinsically linked. The Trust Board continues to receive assurance on data quality through the Trust’s Integrated Governance and Assurance Framework. The Data Quality Assurance Committee continues to report to the Information Governance Committee, where the Data Quality Dashboard is tabled and areas for attention are noted.

Information Asset Owners (IAOs) are now expected to attend the Data Quality Assurance Committee meetings every other month; this is instead of holding separate quarterly meetings. This action is to address the recommendation from the Internal Audit review to ensure IAOs are fully engaged with the Data Quality agenda. The Committee retains the right to expect any


Quality Report

IAO to attend a meeting should the results in their dashboard raise concerns. Root cause analysis has yet to be implemented when investigating targets are not being met. All Information Asset Owners have completed a risk assessment for their systems for the year providing evidence for the Information Governance Toolkit.

The Royal Cornwall Hospitals NHS Trust submitted records during 2013/14 to the Secondary Uses Service (SUS) for inclusion in the Hospital Episode Statistics (HES) which are included in the latest published data. For the period April 2013 - February 2014:

The percentage of records in the published data which included the patient’s valid NHS number was:

p 99.7% for admitted patient care. p 99.8% for outpatient care. p 97.4% for accident and emergency care.

The percentage of records in the published data which included the patient’s valid General Medical Practice Code was:

p 100% for admitted patient care. p 100% for outpatient care. p 99.7% for accident and emergency care.

Information Governance Toolkit attainment levels

The Royal Cornwall Hospitals NHS Trust Information Governance Assessment Report overall score for 2013/14 was 72% and was graded Green.

Clinical Coding Error Rate

The Royal Cornwall Hospitals NHS Trust was not subject to the Payment by Results (PbR) clinical coding audit during the reporting period by the Audit Commission.

National Quality Indicators

Where possible the national data reflects acute trusts only.


6

The Royal Cornwall Hospitals NHS Trust

considers that this data is as described for the

following reasons

p The data is validated nationally, and

p Correlates with the Trust’s internal data.

The Royal Cornwall Hospitals NHS Trust has taken the following actions to improve this score and so the quality of its services, by continuing to review both national and local mortality data ensuring that appropriate actions are taken where indicated.

The value and banding of the summary hospital-level mortality indicator (“SHMI”) for the Trust

April 2012 – March 2013 July 2012 – June 2013 National Data National Data average lowest highest RCHT average lowest highest RCHT 1.04 1.05 1.00 0.65 1.17 (Band 2 ‘as 1.00 0.63 1.16 (Band 2 ‘as expected’) expected’)

The percentage of patient deaths with palliative care coded at either diagnosis or specialty level for the Trust

April 2012 – March 2013 July 2012 – June 2013 National Data National Data average lowest highest RCHT average lowest highest RCHT 19.9 0.1 44 16.5 20.3 0 44.1 17.4

The Trust’s patient reported outcome measures scores for groin hernia surgery – EQ-5D adjusted average health gain

April 2010 – March 2011 April 2011 – March 2012 National Data

RCHT National Data

RCHT average lowest highest average lowest highest 0.085 -0.020 0.156 0.078 0.087 -0.002 0.143 0.072

The Trust’s patient reported outcome measures scores for varicose vein surgery – Aberdeen varicose veinScore adjusted average health gain (lower scores are better)


RCHT National Data

RCHT average lowest highest average lowest highest -7.518 11.268 -11.196 -7.822 -7.896 -1.092 -13.799 -8.185

The Trust’s patient reported outcome measures scores for hip replacement surgery – Oxford Hip Score adjusted average health gain


RCHT National Data

RCHTaverage lowest highest average lowest highest 19.716 14.88 23.59 19.838 20.077 15.2 23.919 20.149


Quality Report

The Trust’s patient reported outcome measures scores for knee replacement surgery – Oxford Knee Score adjusted average health gain


RCHT National Data

RCHT average lowest highest average lowest highest 14.873 9.678 19.031 15.444 15.148 11.0 19.582 16.283

The percentage of patients aged 0 to 15; readmitted to a hospital which forms part of the Trust within 28 days of being discharged from a hospital which forms part of the Trust


RCHT National Data

RCHT average lowest highest average lowest highest 10.15* 0.00 14.34 9.33 10.01* 0.00 14.94 10.56

The percentage of patients aged 16 or over; readmitted to a hospital which forms part of the Trust within 28 days of being discharged from a hospital which forms part of the Trust.


RCHT National Data

RCHT average lowest highest average lowest highest 11.42* 0.00 14.09 11.21 11.45* 0.00 13.80 11.02

The Trust’s score with regard to its responsiveness to the personal needs of its patients. Indicator based on data from National In-patient Survey

2011-12 2012-13 National Data

RCHT National Data




following reasons



The Royal Cornwall Hospitals NHS Trust has taken the following actions to improve this score and so the quality of its services, by ensuring all PROMS data is reviewed by the relevant specialties and participating clinicians.

The Royal Cornwall Hospitals NHS Trust considers that this data is as described for the following reasons

p The data is validated nationally, and p Correlates with the Trust’s internal data.

The Royal Cornwall Hospitals NHS Trust intends to take the following actions to improve this

score and so the quality of its services, by

working together with the Cornwall Health

and Social Care community to reduce hospital

readmissions.

*National average for all NHS Trusts in England.

Lowest and highest figures relate to acute

Trusts only.


6

The percentage of patients who were admitted to hospital and who were risk assessed for venous thromboembolism

July – September 2013 October – December 2013 National Data

RCHT National Data

RCHT average lowest highest average lowest highest 95.7 81.7 100.0 96.4 95.8 77.7 100 95.1

The rate per 100,000 bed days of cases of C.difficile infection reported within the Trust amongst patients aged two or over


RCHT National Data

RCHT average lowest highest average lowest highest 22.2 0 58.2 19.7 17.3 0 30.8 12.2

The number of patient safety incidents reported within the Trust


RCHT National Data

RCHT average lowest highest average lowest highest 3033 99 10455 3659 3285 174 11495 4014



The Royal Cornwall Hospitals NHS Trust intends

to take the following actions to improve this

score and so the quality of its services, by

listening and acting upon all patient feedback.

A working group is in place to act on the results

from the 2013 National In-patient Survey led by

the Trust’s Patient Experience Manager.



following reasons



The Royal Cornwall Hospitals NHS Trust has

taken the following actions to improve this score and so the quality of its services, by continuing to ensure all our patients are risk assessed on admission, including targeted action where performance is below 100%. The EPMA system has been updated to include a mandatory VTE risk assessment.



following reasons



The Royal Cornwall Hospitals NHS Trust intends to take the following actions to improve this score and so the quality of its services, by reviewing antibiotic prescribing by both hospital doctors and GPs and compliance with all infection, prevention and control policies.


Quality Report

The rate of patient safety incidents reported within the Trust

April – September 2012 October 2012 – March 2013 National Data

RCHT National Data


The number of such patient safety incidents that resulted in severe harm or death


RCHT National Data


The percentage of such patient safety incidents that resulted in severe harm or death


RCHT National Data

RCHT average lowest highest average lowest highest 0.72 0 3.56 0.63 0.68 0 4.75 0.70




to take the following actions to improve this The

Royal Cornwall Hospitals NHS Trust intends to

take the following actions to improve this score

and so the quality of its services, by continuing

to encourage a reporting and learning culture

within the organisation.



The Royal Cornwall Hospitals NHS Trust intends to take the following actions to

improve this score and so the quality of its services, by continuing with our Listening into Action initiative and improving the health and wellbeing of our staff. The Trust notes the low scores on this important indicator and has included it as one of our key service improvement areas for 2014/15. Please see page 14 for more detail.

The percentage of staff employed by, or under contract to, the Trust during the reporting period who would recommend the Trust as a provider of care to their family or friends

2012 2013 National Data

RCHT National Data



6




to take the following actions to improve this

score and so the quality of its services by

responding to the themes identified by our

patients.

The Trust’s score from a single question survey which asks patients whether they would recommend the NHS service they have received to friends and family who need similar treatment or care – Combined Inpa-tient & Emergency Department Score

January 2014 February 2014 National Data

RCHT National Data



Quality Report

PART 3 REVIEW OF THE TRUST’S QUALITY PERFORMANCE

Patient SafetyProductive Ward: environmental improvements and increases in direct care time

The Trust has been successfully adopting the Productive Ward programme developed by the NHS Institute in 2008. Its purpose is to support ward and other clinical care teams to redesign and streamline the way they manage and work. This helps achieve significant and lasting improvements – predominately in the extra time that they give to patients, as well as improving the

quality of care delivered whilst reducing costs. The project concentrates on working with ward teams to improve ward processes and environments.

Productive ward is a modular project and each ward has implemented the Well Organised Ward module at varying times during the project. Focus has now moved to the process modules which are being delivered individually Trust wide. There is agreement that standardisation of ward processes reduces complexity (is therefore safer for patients), prevents unnecessary interruptions to staff and patients, and reduces comings and goings in very busy environments.

Examples of improved environments and processes can be seen in the before and after pictures of Carnkie ward.

Before After

And clinical storage on Trauma.

Before After


6Wards have been challenged to double their direct care time using the amalgamated Trust baseline of 27% in 2012 to a Trust aggregate of 45% during 2013. This goal has been exceeded with an impressive improvement to 48% in December 2013. The Trust will now work towards a new goal of 60% during 2014.

Achievement of the interim goal direct care time improvement contributes towards increased patient safety and has been achieved through many small ward based improvement ideas and projects put into action. The goal of improving direct care time empowers staff to prioritise bedside care over other priorities and is consistent with our core Trust values.

Priorities for Improvement to environment;

p Working together with all services and disciplines to maintain a clutter free environment. A regular seasonal Trustwide de-clutter is planned. p Maintain Direct care time (the time our nurses spend with patients at the bedside) at or above 48% using the Productive ward activity follow tool in all inpatient areas, with an aim of achieving 60% in December 2014. p Collaborative working with established groups to free up time for nurses to care. Examples being; Clinical Site Development Plan, information technology projects (ie. Electronic patient record, electronic prescribing, Maxims and Trust wide handover) review of equipment library, hotel services tender. p Standardisation – ensure common ward services and functions such as, information, workstations, equipment, waste, supplies, medical records are maintained to a standard format and location to ensure recognition by wider ward and visiting teams and temporary staff. This in turn assists substantive staff by preventing interruptions and allows them to get on with caring.

E-Prescribing: Electronic Prescribing and Medicines Administration (EPMA) System

The main aim of the EPMA system is to improve patient safety by reducing prescribing and administration errors. Patient safety is the most important factor and by having the prescription log for each patient on computer, staff can be sure that what they are seeing is the most accurate up-to-date information available as the system is in real time. The system also reports who has prescribed, what they prescribed, and when it was given, thereby reducing the chances of someone missing a dose.

The Electronic Prescribing and Medicines Administration (EPMA) project was launched on the paediatric (children’s) wards at the Trust in December 2012 before being rolled out across all three of the Trust’s sites.

EPMA is well embedded in areas such as paediatrics where it has been in situ for over 12 months and is bedding in within other areas such as the surgical wards and theatres. There is already data to show that the benefits of moving to an electronic system are being realised. It should be noted that many of these benefits have been realised through the innovative ways the EPMA team has adapted the system via in-house developments informed by feedback from clinicians.

Allergy statusThe EPMA system will not let users prescribe a drug without a valid allergy status for the patient. The average number of monthly allergy incidents across the Trust before implementation of EPMA was three per month. In the three months following the full implementation of EPMA there have been no reported allergy incidents.

Electronic Ordering of MedicationsThe Trust was determined to move away from handwritten medication requests from the wards when ordering medicines. The EPMA team developed an easy to use system for electronic


Quality Report

ordering of medications by nurses. This solution has not only eliminated potential risks but has also been able to incorporate bar-code technology into the ordering process, so the dispensary team now uses bar-code scanners to select the patient ward, patient name and drug. This has reduced the number of dispensing errors from 2.7 prescriptions/ month (0.012%) to 1.1 prescriptions/ month (0.005%).

The ordering method also eliminates the time taken for the request to be picked up from the ward and transferred to pharmacy, as the requests print out directly in the dispensary. This means that medications are dispensed in a more timely fashion. In October 13 (pre-implementation), 891 non-stock items were processed by the dispensary before 10.30am, in March 14 (post implementation), this has risen to 1,765 items- an increase of 198%. The more timely provision of medications reduces the likelihood of missed and delayed doses due to medication unavailability therefore improving patient care.

Improved Patient InformationThe EPMA team has developed a patient reminder chart that prints out directly from the EPMA system on discharge and is given to patients. The reminder chart includes information on what medications they are taking and their frequency. It also includes signposting information regarding who the patient can contact for further information about their medicines. In 2011 the Trust scored 75% in the inpatient survey in response to the question ‘Were you given clear written or printed information about your medicines?’; this has risen to 82.4% in the 2013 results.

Clinical Pharmacist Prioritisation ToolThe EPMA team has used data within EPMA to develop a ‘pharmacist friend’ webpage. This tool shows the pharmacist the status for that patient regarding medicines reconciliation, high risk medicines prescribed, missed doses of critical medicines and outstanding medication orders to be processed. The tool helps the

ward pharmacy team prioritise their patients according to pharmaceutical risk. The tool has delivered an improvement in ward pharmacy efficiency evidenced through improved medicines reconciliation rates and discharge medication turnaround times.

External Cardiology Service Review

In September 2013 the Trust together with NHS Kernow jointly commissioned an External Cardiology Service Review following concerns identified through routine governance procedures – specifically the identification of cardiology patients overdue for outpatient follow-up appointments or waiting for a planned cardiac investigation.

The External Review Team made it clear that the Cardiology Service at the Trust is safe. However, it made a number of recommendations to improve the quality, governance and functionality of the service which are being implemented in full. These recommendations were themed under the following headings:

p Improving Service Quality. p Improving Service Safety. p Development of the Department of Cardiology. p Consultant Job Planning. p Demand and Capacity and Operational / Governance Performance Reporting.

An action plan has been developed to address all the recommendations which is monitored by both the Trust and NHS Kernow.

Clinical EffectivenessClinical Site Development Plan (CSDP)

The Trust’s Clinical Site Development Plan (CSDP) supports the Trust’s Integrated Business Plan (2012-2018) by ensuring clinical services are located in the right place in modern facilities. The programme of works included in the CSDP is designed to reconfigure services to improve safety, quality of services and generate efficiencies.


6The programme covers all three hospital sites and is grouped in four phases. The last twelve months has seen further progress in Phase 1 of the CSDP with a number of strategic projects now completed.

The Emergency Department has undergone major redevelopment in the last 12 months with Phase 1, an extension of the department to provide new Minors and Paediatric Assessment areas, completed in August 2013:

New Emergency Department reception and waiting August 2013

The extension provides an additional 250 sqm of clinical accommodation which, combined with a major refurbishment of the main reception area, brings more capacity designed to improve patient flow and provides a modern fit for purpose clinical environment.

The final key phase of the Emergency Department expansion was completed in December 2013. Works were undertaken to upgrade nine trolley bays to re-provide high quality refurbished assessment bays including new trolleys and IT provision. The completion of this phase resulted in the total number of trolley bay spaces in the department increasing to 22 from the original nine spaces designated in the

Department at the start of the works programme.Alongside the Emergency Department

reconfiguration two new Digital X-Ray Rooms were completed in the Trelawny Wing Imaging Department and this state of the art equipment was brought into operation in July 2013.

The CSDP Theatre Reconfiguration programme has resulted in upgrades to the Orthopaedic suite with Theatre 10 and 11 having been upgraded to Ultra Clean Ventilation at the end of July 2013.

The theatre programme continued with the expansion of the theatre recovery area for Theatres 10 and 11 completed at the end of August 2013. The recovery area was extended from six to eight patient spaces to improve theatre flow. The Trelawny theatre programme continued with the upgrade of Theatres eight & nine to fully


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integrated laparoscopic specification which came to a close in December 2013. This brings the total number of laparoscopic theatres across the Trust to five.

Works to integrate Paediatrics Services in the Tower were completed this year. This included the remodelling of Tower Recovery to provide three dedicated paediatric spaces and a general refurbishment of the area including refurbishment of Theatre 1 and the staff changing and rest areas.

The expansion of Theatre Direct into the former Ophthalmology department was a key enabling scheme for the second phase in the implementation of the Surgical Floor on the 2nd floor of Trelawny Wing. The new larger Theatre Direct was completed in July 2013 and is the direct admissions facility to support the new theatre reconfiguration in Trelawny and provides new gender separated waiting and changing rooms, a total of six consenting rooms and improved toilet and staff facilities for the ward.

The final project to complete the Trelawny Surgical Floor was the creation of two new surgical wards. The first replacing the surgical receiving unit in Tower was St Mawes unit and the second replacing the general surgical ward in tower was Pendennis Ward. This £1.6M project resulted in a major remodelling and refurbishment of two ward templates to enable the transfer of general surgery in December 2013. This brought to a close the Trelawny Surgical Floor programme, which has also seen the completion of a new Critical Care Unit, upgraded Theatres, expanded Theatre Direct and Surgical Specialties Ward, representing an investment of £7M in bringing together acute surgery and upgrading facilities in the ‘hot hub’.

Nationally reported consultant reported outcomesIn December 2012 NHS England (formerly NHS Commissioning Board) published its planning guidance for 2012/13, entitled “Everyone counts: Planning for patients 2013/14”. Under ‘Offer 2’, the commissioning board stated that:

“The Healthcare Quality Improvement Partnership (HQIP) will develop methodologies for casemix comparison and, in conjunction with NHS Choices, publish activity, clinical quality measures and survival rates from national clinical audits for every consultant practising by summer 2013 in the following specialties”.

Ten specialities were chosen using national clinical audit data. The data is available via www.nhs.uk/consultantdata or directly from the relevant professional bodies’ website. It will initially be refreshed annually and reporting of data in this way will be mandatory from 2014/15.

Each Specialty area has a different national website and a different way of publishing the data, some more user friendly than others. All publish data by number of procedures, by type and standardised mortality ratios. Each specialty publishes other data specific to that specialty.

Published outcomes relevant to RCHT:

p Vascular surgery (surgery on veins and arteries). p Bariatric surgery (surgery to treat obesity. p Interventional Cardiology (heart disease treatments carried out via a thin tube placed in an artery). p Orthopaedic surgery (surgery for conditions affecting bones and muscles). p Urological surgery (surgery on the kidneys, bladder and urinary tract). p Colorectal surgery (surgery on the bowel). p Upper gastrointestinal surgery (surgery on the stomach and intestine). p Head and Neck cancer surgery.

Overall none of the Trust’s Consultants were identified as an outlier.

The number of procedures undertaken per surgeon within a given specialty varies significantly. Most Consultants were in line with the national average in terms of outcomes with some performing far better.


6Simulation Training Simulation-based training has continued to expand through the Trust in 2013-14. The majority of training uses high-fidelity patient manikins. The Trust now has adult, child, infant and obstetric manikins. Regular laboratory-based sessions in the Postgraduate Centre have been a feature for several years now and have become part of the regular training programmes of many specialties and disciplines. An exciting expanding area over the last year has been point-of-care sessions in the clinical environment. These have escalated from a pilot-project last year to established regular multidisciplinary team-based simulation sessions.

The Simulation Practitioner and Simulation Fellow have been joined this year by a technician. In addition, the training faculty encompass a mix of clinicians with a particular interest in simulation-based training. They have become experts in the skills of debriefing through regular session delivery and formal debriefing training provided through the Postgraduate Department.

2013 saw members of our simulation teams present workshops, talks and posters at conferences in New York, Paris and the UK.

The Foundation Simulation programme has been running over the last three years. This year, the simulation team was proud to have

designed and set up a deanery-wide curriculum-linked programme, written by trainers across the deanery. The team also saw the introduction of formal compulsory sessions for trainees in F1 and F2 medical training years.

The Emergency Department continues to run regular sessions, but now encompass regular sessions at the point-of-care. A monthly trauma simulation draws in surgical and anaesthetic staff from outside of the department and allows training as a multidisciplinary team.

The monthly Training in Obstetric Multi-Professional Emergencies (TOME) course continues to provide excellent multidisciplinary team training as well as fulfilling mandatory training requirements and maintaining level three CNST requirements.

The simulation team continues to run courses in anaesthesia and this year ran two aeromedical retrieval simulation days in conjunction with Royal Navy and Royal Airforce Sea-king helicopters in Truro and Barnstaple. The team is proud to be one of a few centres accredited internationally for the Managing Emergencies in Paediatric Anaesthesia (MEPA) course.

A rolling programme of point-of-care sessions is now established rotating through wards on a monthly basis. Simulations are tailored to the


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clinical needs of the particular environment and involve all available clinical staff. Staff feedback is particularly strong with many commenting on the clinical relevance and unique training opportunities that this brings. Sessions are debriefed and then reports are generated to address training and logistical issues generated during sessions. Feedback to clinical areas has resulted in, substantial changes to the clinical environment, which will have a direct impact on patient safety.

Point-of-care simulation has been used successfully this year to re-run critical incidents and the scope to integrate simulation-based training into the Trust risk-management system is being explored. To this end, critical incident and serious incident logs are now reviewed by the simulation team to see whether there might be a role for simulations in the investigation and resolution of these events.

2013-14 has seen simulation at the Trust expand from an educational tool into clinical risk management and is now used to test clinical systems, resources and team dynamics.

During 2013, the simulation training team delivered: p 157 sessions totalling over 400 hours; over 3000 staff training hours. p 84 Point-of-Care sessions. p Training episodes p, 440 Nurses p, 179 Midwifes p, 70 Allied Health Professionals p, 81 Students p, 649 Doctors.

Patient ExperienceNational Inpatient Survey

Between September 2013 and January 2014 a questionnaire was sent to patients who had been admitted as an inpatient during June, July or August 2013 for each NHS Trust in England. A core sample of 850 patients was included from each Trust. Responses were received from 416 of the Trust’s patients who were admitted during July 2013.

WORSE BETTERABOUT THE SAME








The Trust’s scores compared to other NHS Trusts

Score Theme Comparison with other Trusts

8.3/10 The Emergency / A&E Department

9.0/10 Waiting list and planned admissions

7.6/10 Waiting to get to a bed on a ward

8.1/10 The hospital and ward

8.5/10 Doctors

8.0/10 Nurses

7.5/10 Care and treatment

8.4/10 Operations and procedures


6


BETTERABOUT THE SAME


The Trust’s scores compared to other NHS Trusts

Score Theme Comparison with other Trusts

8.7/10 Labour and birth

8.4/10 Staff

7.2/10 Care in hospital after the birth

Each score is based on a series of questions; 70 in total. Of these

p 32 scores have increased (46%) – two significantly. p 16 scores have remained the same (23%). p 22 scores have decreased (31%).

The Trust’s Patient Experience Manager will be leading a working group to develop a robust action plan in response to the findings.

National Survey of Women’s Experiences of Maternity CareDuring the summer of 2013, a questionnaire was sent to all women who gave birth in February 2013 in England. Responses were received from 171 (47.8% response rate) of the Trust’s patients.

WORSE

The responses indicate that our women are not as satisfied with the services we currently provide compared to those at the time of the previous survey in 2010. Key areas for action are:

Antenatal p Improving information regarding choice where to have care and where to have baby. p Reducing number of midwives seen in pregnancy. p Improving quality of interaction with midwife and mother e.g. time to ask questions, being listened to and being involved in making decisions.

Labour and Birth p Quality and consistency of advice at the start of labour. p Staff introducing themselves before treatment or examination. p Being left alone at a time it worried them. p Being involved in decisions made.

Postnatal Care in Hospital p Being given information and explanations needed. p Being treated with kindness and understanding. p Cleanliness.

Feeding p Provision of relevant and consistent feeding information. p Provision of active support and encouragement.


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Care at Home p Reducing numbers of midwives seen. p Improving awareness of medical history. p Improving confidence in the midwives. p Informing of need for GP check. p What to expect regarding own recovery after birth e.g. physical and emotional changes.

The action plan that has been developed to address the key issues from the survey is monitored monthly by the Supervisors of Midwives and quarterly by the Trust’s Patient Experience Group.

National Cancer Patient Experience SurveyThe results of the 2012-13 National Cancer Patient Experience Survey were extremely positive and the Trust has been deemed the second most improved Trust in the country, being placed 18th out of the 155 Trusts.

The survey included all adult patients (aged 16 and over) with a primary diagnosis of cancer, admitted to an NHS hospital as an inpatient or day-case and who had been discharged between 1/09/12 and 30/11/12. The survey is designed to assess cancer patients’ experiences while being treated in hospital such as whether their diagnosis and treatment options were explained clearly to them; whether they felt supported in their care; and whether they felt they were treated with respect.

155 Trusts providing cancer services participated in the survey, accounting for all Trusts providing adult cancer care in England. 1035 RCHT patients were sent a survey, with 636 returned representing 67%, the national response rate was 64%. Patients were allocated into 13 different cancer groups (tumour sites), in some tumour groups (i.e. the rarer cancers) where numbers were less than 20 these have not been recorded. In RCHT three groups came within this category i.e. Brain / Central Nervous System (5 patients), Sarcoma (6 patients) and Head & Neck (18 patients).

Some of the areas where patients have shown a significantly increased level of satisfaction are provision of written information on their type of cancer and side effects of

treatment, confidence and trust in doctors and nurses, information and support when leaving hospital and control of side effects and pain. Each tumour site multi-disciplinary team (MDT’s) has reviewed their results and identified their top five pledges to patients. These are areas identified by the team (and survey) as areas for improvement, ensuring that the pledge is achievable and deliverable. The MDT’s are regularly re-visited and supported by the management team in order to ensure these pledges are achieved.

Examples of patient pledges:

p The Breast MDT have pledged to focus on best possible pain control. p The Upper GI MDT have pledged to involve patients more fully about different treatment options with the aid of pictures/ written information as appropriate. p The Skin MDT have pledged to involve relatives when giving patients their diagnosis.

Involvement and Stakeholder Engagement Healthwatch

Following the transition from LINks to Healthwatch, a good working relationship has been established with both Healthwatch Cornwall and Healthwatch Isles of Scilly. A formal working agreement is in the process of being drawn up. A member of Healthwatch Cornwall sits on the Patient Experience Group.

Patient AmbassadorsPatient Ambassadors are volunteers who work in partnership with staff and patients to support patient/public involvement with the planning and delivery of Trust services to improve patient experience. 12 Patient Ambassadors have been working with the Divisions on 19 different projects which required patient involvement; 11 additional Patient Ambassadors were recruited in March 2014 to meet the demand from the Divisions.


6During 2013-14 the Patient Ambassadors have helped the Trust develop a number of services including:

p Designing information with consideration of visually impaired people. p Undertaking observations of care in wards and clinical areas. p Providing real time feedback to staff. p Attending Trust committees and groups representing the ‘patient voice’ p Supporting staff with the development and testing of the clinical imaging website. p Encouraging patients to raise any concerns as quickly as possible to the staff caring for them. p Sharing patient stories to facilitate learning from patient experiences. p Working with Clinical Support and Cancer Services to improve the overall service rating in the National Cancer Survey. Moving from 98th to 18th in the country.

As an aspirant NHS Foundation Trust we continue to focus on our membership as the priority for engagement and involvement, integrating this work with Patient Ambassadors and specialty patient groups.

Public membership is now at 6,029 with staff membership at 5,554 (March 2014).

A full analysis of public membership in line with Monitor requirements is available in the table below. This identifies the number of members the Trust has in each category against how many more are needed to match the demographics of 1% of Cornwall and the Isles of Scilly. The numbers in red are those groups under represented.

Number of members Cornish Population Percentage

Total 6,029 532,273 1.14%Age Group0 - 16 251 37,521 0.67%17 - 21 605 25,667 2.35%22+ 5,173 437,828 1.29%Not stated 0 EthnicityWhite 5,449 495,761 1.05%Mixed 39 2,297 0.89%Asian 32 945 0.95%Black 13 789 1.73%Other 18 936 2.19%Not stated 478


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Number of members Cornish Population Percentage

Socio-economic GroupAB 389 65,955 0.59%C1 2,989 120,400 2.48%C2 1,573 75,072 2.13%D/E 909 134,536 0.68%Unclassified 169 GenderMale 2,277 242,235 0.87%Female 3,732 258,677 1.41%Not stated 15 DisabilityYes 745 113,715 0.65%No 5,260 418,558 1.25%

The target of 2% of the Cornwall and Isles of Scilly population has been internally set to reach a public membership of 10,000. This is not required for election purposes, but it is demonstrating good practice for communication and engagement with the local population.

We continue to focus on recruiting individuals who are under-represented in our membership and to ensure everyone has an opportunity to have their say on our services.

A shadow Council of Governors has been in place since February 2013 and the Membership and Engagement Committee provides leadership on membership and recruitment activities.

Significant engagement in the past 12 months includes the Trust’s first ever Open Day in June 2013, enabling members to tour hospital facilities, attend talks on health and wellbeing and the future strategy for the hospital as well as give views on vital services. In March 2014, we conducted a survey with members on outpatient services and our use of technology to improve customer service and influence development of an electronic patient record. In November 2013, we launched a campaign on our text appointment reminder service to respond to membership comments and concerns.

Members receive a monthly email bulletin and quarterly magazine to keep them updated on Trust developments and services as well as news on ways to get involved such as our patient

information readers’ panel, volunteering and Patient Ambassador projects.

The Membership and Engagement Committee has recently agreed its work programme for 2014/15 which will include more outreach events across Cornwall and the Isles of Scilly as well as involving more diverse groups and individuals in the development of services.

Statements from Healthwatch, Health and Wellbeing Boards and Clinical Commissioning Groups

Kernow Clinical Commissioning GroupKernow Clinical Commissioning Group is pleased to have the opportunity to comment on the Quality Account 2013/14 for the Royal Cornwall Hospitals Trust (RCHT), and welcomes the approach the Trust has shown in developing and setting out its plans for quality improvement. There are routine processes in place with RCHT to agree, monitor and review the quality of services throughout the year covering the key quality domains of safety, effectiveness and experience of care.

The Quality Account presents an overview of a wide range of quality improvement work being undertaken. We are particularly pleased to see the Board’s ambition to achieving a Care Quality Commission assessment of “Outstanding” and we welcome the Board’s commitment to


6quality as demonstrated through the priorities improving Patient Safety and Experience.

The report presents a fair reflection of progress in 2013/14 and we can confirm the information presented in the Quality Account appears to provide a balanced account which is accurate and fairly interpreted, from the data collected. In terms of the performance against the 2013/14 CQUIN goals the NHS Safety Thermometer indicators relating to pressure ulcers were not achieved in full.

We note the positive improvements Royal Cornwall Hospitals has made in:

p Reducing the incidence of combined harm of areas identified within the Safety Thermometer p Recognition of the work in the Electronic Prescribing and Medicines Administration reducing the risk of medication errors and improving patient safety through mandating VTE assessment p Progress in the Clinical Site Development plan improving facilities and patient environments p Publically publishing surgical and clinical quality outcomes

Kernow CCG looks forward to working with the Trust throughout the year to deliver high quality services to patients, especially:

p Patient Safety & Patient Experience, and in particular recognition of the importance of linking mortality reviews to business planning and care pathway improvement p The development of seven days services, and in particular the link to work on improving discharge arrangements for patients; KCCG would like to see strong links with this and the multi-agency urgent care board p Improving the quality of care through joint working between primary and secondary care clinicians on developing patient pathways p Improving the quality of care through plans to improve health and wellbeing

of its staff, particularly with strengthening communication and support across clinical teams and management

We are pleased to see that the priorities chosen for 2014/15 are evidence based and have been identified with key stakeholder involvement. Kernow CCG recognises the work undertaken in the following areas and would wish the Trust to continue to focus on these areas although not specifically identified as a priority:

p It is good to see the work undertaken to reduce harm to patients through the continued use of the national safety thermometer and is therefore disappointing that the Trust has not achieved the improvement in reducing harm from pressure ulcers. KCCG looks forward to seeing positive impacts from the introduction of the lower limb pathway p The refurbishment of the Treliske site ED has provided a modern facility significantly improving the environmental experience for patients, however there remain challenges in providing a timely quality service for patients attending the service; Kernow CCG recognises the benefits that seven day services will bring in the longer term. p Strong and rapid focus to develop and implement the Trust wide vision for the pathway of those who are frail, linking in closely with health, social care and community partners, ensuring that people who are frail remain a priority and that their complex needs are understood and are given due consideration across all generic and specialist pathways

Cornwall Health and Social Care Scrutiny CommitteeCornwall Council’s Health and Social Care Scrutiny Committee agreed to comment on the Quality Account 2013 -2014 of Royal Cornwall Hospitals Trust (RCHT). All references in this commentary relate to the period 1 April 2013 to the date of this statement.


Quality Report

Royal Cornwall Hospitals Trust have engaged when the Committee and regularly attend meetings.

Committee Members felt that the Quality Account provided a good reflection of the services provided by the Trust, and provided a comprehensive coverage of the provider’s services. However, they believed it was a complex document which was not easily understandable for the public; this especially applies to the presentation of data and a lack of comparator information.

In relation to priorities, the Committee welcomed the intention to increase seven day working, the focus on patient experience and the roll out of the EPMA system. It noted that the Trust is working towards the CQC action plan and will be seeking assurances that this is being completed. The Committee would be interested in seeing information about how patient time has increased as a result of the productive ward project.

The Committee have concerns about the slow improvement in staff morale and about staffing levels within the Trust. It is noted that the Trust management have recognised this as an issue and are looking to address this as a priority.

The Committee were surprised not to see more relating to the ‘Fall to Green’ exercise that the Trust were part of, but recognised elements of the learning from this activity do feature within the account. Also considering the ongoing concerns regarding the four hour target relating to Accident and Emergency the Committee felt that this should be a higher priority.

The Committee looks forward to working in partnership with the Trust in 2014-15.

Healthwatch CornwallDo the priorities of the provider reflect the priorities of the local population? Healthwatch Cornwall was pleased to read the Quality Account for Royal Cornwall Hospital Trust 2013/14 and note the extensive commitment to improving standards in

patient treatment, safety and discharge in a year on year approach, as well as an obvious engagement programme to support and maintain the health and well-being of its staff.

The relationship that Healthwatch Cornwall has with the Trust has been building in our first year of operation and we have been very much supported by the Patient Experience Team in developing a programme of activity which allows our volunteers to engage with patients, family and staff, in an independent observation and review of care and patient experience in several departments selected by us. Additionally we have been invited by the Trust to assist with their quality audits as an external body, which shows a commitment by them to openness and a desire to receive critical feedback in order to improve services. This work will be undertaken from June 2014.

We have been welcomed as an observer in the Fall to Green exercise (November 2013), which aimed at increasing the number of discharges prior to winter pressures and through this gained a real insight into the causes of bed-blocking and the measures the Trust had taken to alleviate this issue. Another visit to the Emergency Department (after its renovation) and the Frailty Unit, gave further insight into measures taken to improve processes for patients.

Considering progress towards the targets set last year, the work on reducing pressure ulcers and catheter assisted urinary tract infections was heartening, although we note that the number of hospital falls was not reduced and that this has led to an action plan and introduction of new equipment to prevent falls. We fully support the CARE campaign and on visits saw evidence that showed an increase in recording the replies against the 4 categories of care, and are surprised that the Trust report that targets were not reached. In our feedback from service users 63% of the comments around staff attitude are positive – and this refers to all stages of treatment from diagnosis, clinical treatment and nursing care and support.

With respect to admission and discharge the electronic discharge plans and electronic


6prescribing and medicine administration systems allow for an improvement for patients in these practices, which we hope to see reflected in our patient interviews. We are aware of improved relations with other Trust stakeholders such as Peninsula Community Health in the discharge process, but are also conscious that this area still needs improvement and will be monitoring this over the next year.

The targets for the coming year reflect wider policy direction to some extent, such as the extended pharmacy service over 7 days. The Early Supported Discharge pilot, that supports people leaving hospital within the community and the target of reducing the length of stay in hospital from 3.1 to 2.5 days, through various mechanisms, should reduce the incidence of bed blocking that has been an issue in 2013. In addition the target to reduce the referral to treatment waiting times is appreciated, since 16% of our feedback is on waiting times.

We feel that the Quality Targets for 2014 do reflect issues of real concern to the people using the service and happily endorse these proposals.

Health Overview and Scrutiny Committee of the Council of the Isles of ScillyThe Health Overview and Scrutiny Committee of the Council of the Isles of Scilly welcomes the opportunity to comment on the Quality Accounts.

We would like to see continued work to improve the patient experience of discharge from mainland acute settings back to the islands. Work needs to be done in individual wards to ensure knowledge of the particular circumstances relating to travel and accommodation for patients from the islands. The work to ensure appointment flexibility for islanders has improved pathways for patients and this must continue particularly in the light of travel disruption over the last winter. Continued commitment to transport issues from the Trust is welcomed.

In order to overcome some of these issues the islands would like to see better take up of technology for consultation and assessment. We would like to see greater commitment to

the pilot project set up by local health partners. We believe that technology can improve patient experience and is a more efficient use of resources.

We are glad to see greater engagement with the Trust in strategic thinking about how to maximise the total health and care resources on the islands to commission and provide the best services for islanders.

Formalised feedback from the appointed Governor will be critical to ensure consistent and constructive dialogue with the Trust.

Healthwatch Isles of Scilly Healthwatch Isles of Scilly is pleased to have the opportunity to comment on the Royal Cornwall Hospitals Trust Quality Account. It affords a detailed and informative measure of performance and progress and we note the continued priority given to patient safety, and to patient experience on discharge from hospital.

Feedback from islanders about the care and treatment they receive from RCHT is still largely positive.

We would not expect the Quality Accounts to address in detail issues specific to the islands, but we are pleased to report that these continued to receive attention throughout the year.

We maintained good working relationships with key individuals within the Trust and together we have addressed issues relating to journey planning: for outpatient appointments, admission and discharge; maternity arrangements; and midwifery.

Through joint efforts across services some progress has been made on point of care testing and other measures to reduce the need to travel. We hope that there will be further progress on the latter, in particular opportunities for teleconsultation, and local X-ray provision.

RCHT’s continued participation in joint work around travel and transport is essential and invaluable. Awareness and assistance from RCHT staff regarding travel, and transport of medical goods, to and from the islands makes a real difference, especially during the recent very challenging winters.


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Healthwatch Isles of Scilly Healthwatch Isles of Scilly is pleased to have the opportunity to comment on the Royal Cornwall Hospitals Trust Quality Account. It affords a detailed and informative measure of performance and progress and we note the continued priority given to patient safety, and to patient experience on discharge from hospital.

Feedback from islanders about the care and treatment they receive from RCHT is still largely positive.

We would not expect the Quality Accounts to address in detail issues specific to the islands, but we are pleased to report that these continued to receive attention throughout the year.

We maintained good working relationships with key individuals within the Trust and together we have addressed issues relating to journey planning: for outpatient appointments, admission and discharge; maternity arrangements; and midwifery.

Through joint efforts across services some progress has been made on point of care testing and other measures to reduce the need to travel. We hope that there will be further progress on the latter, in particular opportunities for teleconsultation, and local X-ray provision.

RCHT’s continued participation in joint work around travel and transport is essential and invaluable. Awareness and assistance from RCHT staff regarding travel, and transport of medical goods, to and from the islands makes a real difference, especially during the recent very challenging winters.

Formal scheduled liaison between Healthwatch and the Trust lapsed last year, due to re-organisation elsewhere and the discontinuation of the LINk Joint Liaison Group. We have renewed our working agreement and look forward to regular contact in 2014-15.

Trust response to comments from third parties The Trust is grateful to stakeholders and

third party organisations that helped to shape our Quality Account for 2013/14. All feedback and comments will be taken into consideration as the Trust delivers on its commitment to further improve the safety and quality of care delivered in Cornwall.

Care given to patients in an emergency is core to the Trusts services. For this care to be fully effective requires close working arrangements between several organisations, including the Trust. As such, the Trust will continue to work closely with its colleagues in health and social care to reduce waiting times for ambulances and for patients within the Emergency Department. A major positive step was taken in 2013 with the completion of the rebuild of the Emergency Department at the Royal Cornwall Hospital (Treliske). These improvements have dramatically improved patient experience in the department. The Trust recognises that further work with partners is required to further improve patient flow along with the management and control of demand and patient admissions. This Quality Account sets out the planned improvements, supported by the statements from the third parties.

Nationally, there has been a focus on improving the safety and effectiveness of patient care. With the introduction of the Friends and Family Test by the government during 2013 there is an increasing focus on patient experience. This is reflected in the plans of the Trust, supported by the feedback on the accounts from third parties. Of particularly emphasis is the experience of patients during the discharge process. The importance of improving these processes is outlined in the Quality Accounts, and has been confirmed by the feedback from Trust’s partners. As set out in this Quality Account, the Trust has made this a priority for the coming year, and will work closely with partners in doing so.

The Trust looks forward to a productive 2014/15, working in close partnership with its colleagues in Health and Social care to further improve the quality of care given to its patients.


6Statement of Directors’ Responsibilities in Respect of the Quality Account

The directors are required under the Health Act 2009, National Health Service (Quality Accounts) Regulations 2010 and National Health Service (Quality Account) Amendment Regulations 2011 and 2012 to prepare Quality Accounts for each financial year. The Department of Health has issued guidance on the form and content of annual Quality Accounts (which incorporate the above legal requirements).

In preparing the Quality Account, directors are required to take steps to satisfy themselves that:

p the Quality Accounts presents a balanced picture of the Trust’s performance over the period covered;

p the performance information reported in the Quality Account is reliable and accurate;

p there are proper internal controls over the collection and reporting of the measures of performance included in the Quality Account, and these controls are subject to review to confirm that they are working effectively in practice;

p the data underpinning the measures of performance reported in the Quality Account is robust and reliable, conforms to specified data quality standards and prescribed definitions, is subject to appropriate scrutiny and review; and the Quality Account has been prepared in accordance with Department of Health guidance.

The directors confirm to the best of their knowledge and belief they have complied with the above requirements in preparing the Quality Account. By order of the Board

26th June 2014 26th June 2014

Angela Ballatti Andrew MacCallumChairman Deputy Chief Exectutive


Quality Report

Independent Auditor’s Report

INDEPENDENT AUDITORS’ LIMITED ASSURANCE REPORT TO THE DIRECTORS OF ROYAL CORNWALL HOSPITALS NHS TRUST ON THE ANNUAL QUALITY ACCOUNT

We are required by the Audit Commission to perform an independent limited assurance engagement in respect of Royal Cornwall Hospitals NHS Trust’s Quality Account for the year ended 31 March 2014 (“the Quality Account”) and certain performance indicators contained therein as part of our work under section 5(1)(e) of the Audit Commission Act 1998 (“The Act”). NHS trusts are required by section 8 of the Health Act 2009 to publish a Quality Account which much include prescribed information set out in The National Health Service (Quality Account) Regulations 2010, the National Health Service (Quality Account) Amendment Regulations 2011 and the National Health Service (Quality Account) Amendment Regulations 2012 (“the Regulations”).

Scope and subject matterThe indicators for the year ended 31 March 2014 subject to limited assurance consist of the following indicators:

p Friends and family test (FFT) patient element score; p Percentage of patients risk-assessed for venous thromboembolism (VTE)

We refer to these two indicators collectively as “the indicators”.

Respective responsibilities of Directors and auditorsThe Directors are required under the Health Act 2009 to prepare a Quality Account for each financial year. The Department of Health has issued guidance on the form and content of annual Quality Accounts (which incorporate legal requirements in the Health Act 2009 and the Regulations).

In preparing the Quality Account, the Directors

are required to take steps to satisfy themselves that:

p the Quality Account presented a balanced picture of the Trust’s performance over the period covered; p the performance information reported in the Quality Account is reliable and accurate; p there are proper internal controls over the collection and reporting of the measures of performance included in the Quality Account, and these controls are subject to review to confirm that they are working effectively in practice; p the data underpinning the measures of performance reported in the Quality Account is robust and reliable, conforms to specified data quality standards and prescribed definitions, and is subject to appropriate scrutiny and review; and p the Quality Account has been prepared in accordance with Department of Health guidance.

The Directors are required to confirm compliance with these requirements in a statement of directors’ responsibilities within the Quality Account.

Our responsibility is to form a conclusion, based on limited assurance procedures, on whether anything has come to our attention that causes us to believe that:

p the Quality Account is not prepared in all material respects in line with the criteria set out in the Regulations; p the Quality Account is not consistent in all material respects with the sources specified in the NHS Quality Accounts Auditor Guidance 2013/14 issued by the Audit Commission on 17 February 2014 (“the Guidance”); and p the indicators in the Quality Account identified as having been the subject of limited assurance in the Quality Accounts are not reasonably stated in all material respects in accordance with the


Regulations and the six dimensions of data quality set out in the Guidance.

We read the Quality Account and conclude whether it is consistent with the requirements of the Regulations and to consider the implications for our report if we become aware of any material omissions.

We read the other information contained in the Quality Account and consider whether it is materially inconsistent with:

p Board minutes for the period April 2013 to June 2014; p papers relating to the Quality Account reported to the Board over the period April 2013 to June 2014; p feedback from the Commissioning CCG (Kernow CCG); p feedback from Local Healthwatch (Healthwatch Cornwall); p feedback from other named stakeholder(s) involved in the sign off of the Quality Account; p the latest national inpatient survey conducted between September 2013 and January 2014; p the latest national staff survey carried out between September and December 2013; p the Head of Internal Audit’s annual opinion over the Trust’s control environment dated 02/06/2014; p the annual governance statement dated 02/06/2014; p the Care Quality Commission inspection report dated 27/03/2014.

We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with these documents (collectively “the documents”). Our responsibilities do not extend to any other information.

This report, including the conclusion, is made solely to the Board of Directors of Royal Cornwall

Hospitals NHS Trust in accordance with Part II of the Audit Commission Act 1998 and for no other purpose, as set out in paragraph 44 of the Statement of Responsibilities of Auditors and Audited Bodies published by the Audit Commission in March 2014. We permit the disclosure of this report to enable the responsibilities by commissioning an independent assurance report in connection with the indicators. To the fullest extent permissible by law, we do not accept or assume responsibility to anyone other the Board of Directors as a body and Royal Cornwall Hospitals NHS Trust for our work or this report save where terms are expressly agreed and with our prior consent in writing.

Assurance work performedWe conducted this limited assurance engagement under the terms of the Audit Commission Act 1998 and in accordance with the Guidance. Our limited assurance procedures included:

p evaluating the design and implementation of the key processes and controls for managing and reporting the indicators; p making enquiries of management; p testing key management controls; p analytical procedures; p limited testing, on a selective basis, of the data used to calculate the indicators back to supporting documentation; p comparing the content of the Quality Account to the requirements of the Regulations; and p reading the documents.

A limited assurance engagement is narrower in scope that a reasonable assurance engagement. The nature, timing and extent of procedures for gathering sufficient appropriate evidence are deliberately limited relative to a reasonable assurance engagement.

LimitationsNon-financial performance information is subject to more inherent limitation than

6


financial information, given the characteristics of the subject matter and the methods used for determining such information.

The absence of a significant body of established practice on which to draw allows for the selection of different but acceptable measurement techniques which can result in materially different measurements and can impact comparability. The precision of different measurement techniques may also vary. Furthermore, the nature and methods used to determine such information, as well as the measurement criteria and the precision therefore, may change over time. It is important to read the Quality Account in the context of the criteria set out in the Regulations.

The nature, form and content required of Quality Accounts are determined by the Department of Health. This may result in the omission of information relevant to other users, for example for the purpose of comparing the results of different NHS organisations.

In addition, the scope of our assurance work has not included governance over quality or non-mandated indicators which have been determined locally by Royal Cornwall Hospitals NHS Trust.

Basis for quality conclusionThe indicator reporting the percentage of patients risk-assessed for VTE did not meet the six dimensions of the data quality in the following respects:

p Relevance and Validity – 16% of the VTE assessments we reviewed from the Trust’s calculation of assessed patients could not be verified to underlying patient notes and records. The relative sensitivity of the indicator is that differences of more than 11% would cause the Trust to fall below the national target of 95%.

The indicator reporting the friends and family test did not meet six dimensions of the data quality in the following respects:

p Reliability – the Trust implemented a new system during the year, which

involved replacing a survey given to patients on discharge with a token which patients place in a box indicating whether they would recommend the Trust to friends and family. There is no audit trail to confirm who placed the tokens in the box. p Completeness – we were unable to test the completeness of the information used in the calculation of the indicator as there is no system which records which patients have been given tokens on discharge. p Validity – since the introduction of the indicator and the Trust’s methodology used to calculate the data, national guidance has changed. Under 16s are no longer required to take part in the survey using the token system. However the Trust is unable to identify which tokens relate to patients under 16 and therefore cannot extract these figures from the data.

Quality conclusionBased on the results of our procedures, with the exception of the matters reported in the basis for qualified conclusion paragraph above, nothing has come to our attention that caused us to believe that, for the year ended 31 March 2014:

p the Quality Account is not prepared in all material respects in line with the criteria set out in the Regulations; p the Quality Account is not consistent in all material respects with the sources specified in the Guidance; and p the indicators in the Quality Account subject to limited assurance have not been reasonably stated in all material respects in accordance with the Regulations and the six dimensions of data quality set out in the Guidance.

Grant Thornton UK LLP

Hartwell House55-61 Victoria StreetBristolBS1 6FT

27 June 2014

Quality Report


6Addendum to Quality Accounts The Trust is required under the Health Act 2009, National Health Service (Quality Accounts) Regulations 2010 and National Health Service (Quality Account) Amendment Regulations 2011 and 2012 to prepare Quality Accounts for each financial year. The Department of Health has issued guidance on the form and content of annual Quality Accounts (which incorporate the above legal requirements).

In preparing the Quality Account, the Trust is required to ensure that:

p the Quality Accounts presents a balanced picture of the Trust’s performance over the period covered; p the performance information reported in the Quality Account is reliable and accurate; p there are proper internal controls over the collection and reporting of the measures of performance included in the Quality Account, and these controls are subject to review to confirm that they are working effectively in practice; p the data underpinning the measures of performance reported in the Quality Account is robust and reliable, conforms to specified data quality standards and prescribed definitions, is subject to appropriate scrutiny and review; and the Quality Account has been prepared in accordance with Department of Health guidance.

The directors have confirmed to the best of their knowledge and belief they have complied with the above requirements in preparing the Quality Account. A very limited external audit is carried out on the Quality Accounts. For the 2013-14 Quality Accounts, the auditors concluded that:

p the Quality Account was prepared in all material respects in line with the criteria set out in the Regulations; and

p the Quality Account was consistent with the sources specified in the NHS Quality Accounts Auditor Guidance 2013/14 issued by the Audit Commission

However, the auditors limited testing found that:

For the VTE assessments, there were a small number of cases where the assessment was not evidenced in the patient records reviewed ; and

For the Friends and Family indicator, as the Trust had used the token system (seen nationally as a best practice approach). the testing could not conclude what type of patient or age of patient, had taken part in the token system survey. As a result, the auditors were required to qualify their opinion in respect of these two issues only.


Over 100 new nurses have been recruited to roles at RCHT over the last year.


Our organisational structure 7

We have a strong board of executive and

non-executive Directors and a Shadow

Council of Governors whose role is

developing as we continue our journey

toward Foundation Trust status.

Board of DirectorsOur Board of Directors is made up of our Chairman, Angela Ballatti, five other Non-Executive Directors and seven Executive Board Directors, including Chief Executive, Lezli Boswell.

The Board’s role is to:

p Set our overall strategic direction within the context of NHS priorities p Ensure the Trust provides high quality, effective and patient focussed services p Monitor our performance against objectives p Provide effective financial stewardship p Ensure high standards of corporate governance and personal conduct p Promote effective dialogue between the Trust, our partners and the local communities we serve

Angela Ballatti - ChairmanAngela joined the Trust in July 2013. She was most recently Chair at Royal Devon and Exeter NHS Foundation Trust for 6 years between 2006 and

2012. Prior to this Angela was a Chair of County Durham and Darlington Acute Hospitals and North Durham Healthcare NHS Trusts in the North East for nearly 9 years in total. She has been appointed until January 2015.

Non-executive directorsRik Evans

Rik is a company director and was previously a non-executive member of Central Cornwall Primary Care Trust with 17 years’ experience on health boards in Cornwall. He is

currently the independent member of Cornwall Council Standards Committee. Having joint the Trust in 2007, Rik has been appointed for a second term left May 2014.

Roger GazzardRoger is a born and bred Cornishman. A qualified accountant who spent thirteen years as a Director of a group of companies in the waste management and

haulage industry sectors. He has also worked in local authority finance both locally and nationally. In recent years he ran a company providing business advice to small and medium businesses. Since the beginning of 2011 he has held the position of Town Clerk to Truro City Council. Having been appointed in 2007, Roger is now in his second term of office which runs until October 2014.


Our organisational structure

Charlotte RussellCharlotte joined the Trust in October 2013. She was a Non-Executive Director at the South Western Ambulance Service for nine years and part of the team that achieved NHS Foundation

Trust status in 2011. She is a company director of an organic farming business with her partner and has been involved in the strategic development of the food and farming industry in Cornwall for many years. She is currently Business Development Manager at the Eden Project and has previously worked in both print and broadcast media with a particular interest in the environment. Charlotte’s appointment runs for 4 years.

john BennettJohn is a partner in a specialist healthcare advisory practice. He has over 17 years experience of working in health care consultancy, in the UK and overseas, and in the NHS

where he commenced his career as an NHS General Management Trainee in 1996. John’s current work focuses on health economy-wide transformation and strategic reform, including work across different sectors including local government and public interest groups. John’s appointment runs from January 2014 for a 4-year team.

Dr Mairi McleanMairi has a background in social work, psychology and leadership and has held senior positions in local government and is a former Council Chief Executive Officer. Mairi

currently runs her own consultancy business which provides leadership and executive coaching, strategic planning and team development. She also holds a number of other

local and national advisory and visiting lecturer position. Mairi was appointed in January 2014 for a 4-year term.

Executive membersLezli Boswell – Chief Executive

Lezli Boswell joined RCHT as Chief Executive on 1st September 2011 having been on secondment as the Director of Provider Development at the South West Strategic

Health Authority for the previous 12 months. Prior to that, Lezli was Chief Executive of the Cornwall Partnership NHS Foundation Trust in Cornwall which she successfully led through its Foundation Trust application. Lezli is an experienced Chief Executive having held a number of similar positions in the NHS in the North West and South West. She is also a local Magistrate and a Trustee of Cornwall Relate.

Andrew MacCallum - Nurse Executive and Deputy Chief Executive

Andrew joined RCHT in May 2012. He was formerly Director of Nursing and Lifelong Learning at Chelsea & Westminster Hospital NHS Foundation Trust in London and

Director of Nursing at Queen Mary’s Sidcup NHS Trust. Most recently Andrew has been Pro Vice-Chancellor and Dean of the College of Nursing Midwifery and Healthcare at the University of West of London.

Dr Rob Parry - Medical DirectorRob has worked at RCHT since 2000 and has played a key part in a host of developments within the renal service. Alongside that he has carried out a number of roles involving

strategy development, implementation and working across multi-disciplinary teams. These


7include having been Renal Departmental Lead, over four years as Clinical Director for Acute Medicine, and five years as Renal Network Clinical Director for the Peninsula. Rob has also led Trust work on organ donation, clinical coding and appraisal

Nick Macklin - Director of Human Resources and Organisational Development

Nick joined the Royal Cornwall Hospitals Trust as Director of Human Resources and Organisational Development in April 2013. He was previously employed in a similar role at

Taunton and Somerset NHS Foundation Trust having worked in the NHS and public sector for the past 20 years. He brings with him a valuable background of workforce and organisational development in a successful NHS Foundation Trust.

jo Gibbs - Chief Operating OfficerJo’s career has covered human resources, organisational development and general management. She has worked in senior roles in the NHS since 1994, working at Trusts in West

Hertfordshire where she gained considerable experience of managing change. For the past 5 years, Jo worked as Director of Operations and Deputy Chief Executive of North Devon Healthcare NHS Trust before joining Royal Cornwall Hospital in April 2010. Jo has recently completed the Top Leaders Programme for aspiring Chief Executives.

Karl Simkins - Director of FinanceKarl Simkins, joined the Trust in July 2010, coming from a similar role at NHS Leicester County and Rutland - one of the largest Primary Care Trusts in the country. Karl has extensive

experience of working across acute Trust, Strategic Health Authority (SHA) and Primary Care Trust organisations, including an SHA role reviewing Trust’s readiness for Foundation status.

Ethna McCarthy – Director of Strategy and Business Development

Ethna is an experienced Director having held a range of senior posts since 1995 across all sectors of the NHS. A chartered accountant by profession, Ethna has significant

experience covering finance, business planning, strategic development, risk management, and research and development. Ethna successfully lead the Cornwall Partnership NHS Foundation Trust application as their Finance Director in 2010. Joining the Board of RCHT as Director of Strategy and Business Development in January 2012, Ethna is leading the Foundation Trust application process, incorporating the delivery of the challenging ‘2018 Programme’ and the design and delivery of our Board Development Programme.


Accurate and timely record keeping; a key part of providing safe care.


Remuneration Report

Section 234B and Schedule 7A of the Companies Act, as interpreted for the public sector, requires NHS bodies to prepare a Remuneration Report containing information about directors’ remuneration. In the NHS the report will be in respect of the Senior Managers of the NHS body. ‘Senior Managers’ are defined as: ‘those persons in senior positions having authority or responsibility for directing or controlling the major activities of the NHS body. This means those who influence the decisions of the entity as a whole, rather than the decisions of individual directorates or departments.’ For the purposes of this report, this covers the Trust’s Non Executive and Executive Directors.

The Secretary of State for Health determines the Remuneration of the Chairman and Non-Executive Directors nationally.

Remuneration for Executive Board members is determined by the Remuneration Committee.

The Remuneration and Terms of Service CommitteeThe terms of reference for the Remuneration Committee were updated and approved by the Board in May 2011 under the review of governance arrangements. The membership of the remuneration committee consists of the Trust Board Chairman and all Non-Executive Directors. In the absence of the Board Chairman a nominated Non-Executive Director will act as Chair.

Remuneration Policy – Executive DirectorsAmendments to salary are determined annually by the Remuneration Committee. Salary is inclusive – other payments such as bonus, overtime, long hours, on-call, standby etc. do not feature in executive director remuneration. Executive director performance is monitored through the formal appraisal process, based on organisational and individual objectives.

The medical director’s salary is in accordance with the Terms and Conditions – Consultants (England) 2003. In addition, a responsibility allowance is payable for the duration of

executive office.Details of remuneration and pensions for

Non-Executive and Executive Directors are detailed in Annex 1.

Pay MultiplesReporting bodies are required to disclose the relationship between the remuneration of the highest-paid director in their organisation and the median remuneration of their organisation’s workforce.

The banded remuneration of the highest-paid director at RCHT in the financial year 2013-14 was £180,000-185,000 (2012-13: £180,000-185,000). This was 7.46 times (2012-13: 6.88) the median remuneration of the workforce, which was £24,468 (2012-13: £26,533).

In 2013-14, 3 (2012-13: 3) employees received remuneration in excess of the highest-paid director. Remuneration ranged from £185,481 to £193,088 (2012-13: £182,960 to £184,276).

Total remuneration includes salary, non-consolidated performance-related pay and benefits-in-kind. It does not include pension contributions and the cash equivalent transfer value of pensions.

The small increase in the pay multiple ratio arose from the decrease increase in the median pay level compared to the unchanged salary of the highest-paid director.

Duration of contracts, notice periods and termination paymentsOther than the medical director, whose executive role endures for the duration of office, Executive Directors are employed on contracts of service and are substantive employees of the Trust. Executive Directors’ contracts can be terminated by either party with up to 6 months’ notice. Following the departure of an Executive Director and in advance of a new appointee commencing, the Trust may engage a suitably qualified and experienced interim director to ensure continuity of leadership.

8


Remuneration Report

Non-Executive DirectorsThe dates of contracts and unexpired terms of office for the Non-Executive Directors are as follows:

Name Appointment Appointment Reappointment Reappointment Start Date End Date Start Date End Date

Angela Ballatti (Chair) 28 June 2013 07 January 2015

Roger Gazzard 08 October 2007 07 October 2010 08 October 2010 07 October 2014

Rik Evans 01 November 2007 31 October 2010 01 November 2010 29 May 2014

Charlotte Russell 21 January 2014 20 January 2018

john Bennett 13 January 2014 12 January 2018

Mairi Mclean 13 January 2014 12 January 2018

Professor Steve Thornton 08 May 2014 07 May 2018 There is no period of notice required for Non-Executive Directors

There are no special contractual compensation provisions for the early termination of Executive Directors’ contracts. Early termination by reason of redundancy or, ‘in the interests of the efficiency of the service’ is subject to the provisions of the Agenda for Change NHS Terms and Conditions Handbook (Section 16).

Employees above the minimum retirement age who themselves request termination by reason of early retirement, are subject to the normal provisions of the NHS Pension Scheme. Details of termination packages, for all staff, paid by the Trust are detailed in Annex 2.


TOTAL (bands of

£5,000

£000ww

Salary (bands of £5,000)

£000

Non-Executive Directors - Name and Title

Expense payments (taxable) total to nearest

£100

£00

Salary (bands of £5,000)

£000


£100

£000

TOTAL (bands of £5,000)

£000

2013-14 2012-13

8ANNEX 1: Salary and Pension Entitlements of Senior ManagersSalaries and Allowances

Angela Ballatti 25-30 0 25-30 0 0 0Chair (from July 2013)

john Bennett 0-5 0 0-5 0 0 0Non-Executive Director(from 13 January 2014)

Mairi Mclean 0-5 0 0-5 0 0 0Non-Executive Director(from 13 January 2014)

Charlotte Russell 0-5 0 0-5 0 0 0Interim Non-Executive Director(31 October 2013 to 20 January 2014)Non-Executive Director(from 21 January 2014)

Rik Evans 5-10 0 5-10 5-10 0 5-10Non-Executive Director(to 29 May 2014)

Roger Gazzard 5-10 0 5-10 5-10 0 5-10Non-Executive Director

Professor Steve Thornton 0 0 0 0 0 0Associate Non-Executive Director(from 8 May 2014)

Martin Watts 5-10 0 5-10 25-30 0 25-30Chair(to 19 June 2013)

Susan Hall 0-5 0 0-5 5-10 0 5-10Non-Executive Director(to 28 June 2013)Mike Higgins 0-5 0 0-5 5-10 0 5-10Non-Executive Director(to 27 June 2013)Interim Chair(25 June 2013 to 27 June 2013)

Douglas Webb 0-5 0 0-5 5-10 0 5-10Non-Executive Director(to 31 October 2013)

Professor Sir Roger Boyle 0-5 0 0-5 0-5 0 5-10Associate Non-Executive Director(to 28 June 2013)

There is no period of notice required for Non-Executive Directors


Remuneration Report

Senior Managers - Name and Title

Other salary(bands

of £5,000)

£000

Salary whilst in post as senior

manager(bands of £5,000)

£000


£100

£00

All pension-related

benefits (bands of £2,500)

£000

TOTAL (bands

of £5,000)

£000

Other salary(bands

of £5,000)

£000

Salary whilst in post as senior

manager(bands of £5,000)

£000

Expense payments (taxable) total to nearest £100

£00

All pension-related benefits

(bands of £2,500)

£000

TOTAL (bands

of £5,000)

£000

ANNEX 1: Salary and Pension Entitlements of Senior Managers (continued)Salaries and Allowances

Boswell, L 175-180 0 15 10-12.5 185-190 170-175 0 27 212.5-215 390-395Chief Executive

Gibbs, j 130-135 0 2 10-12.5 145-150 140-145 0 6 (15)-(17.5) 125-130Chief Operating Officer

MacCallum, A 135-140 0 0 107.5-110 245-250 145-150 0 0 42.5-45 185-190Nursing Executive & Deputy Chief Executive (from 21 January 2014) Interim Nursing Executive (to 20 January 2014)

McCarthy, E 110-115 0 0 112.5-115 225-230 95-100 0 0 17.5-20 115-120Director of Strategy & Development

Simkins, K 140-145 0 14 7.5-10 150-155 135-140 0 14 (30)-(32.5) 105-110Director of Finance

Wheeldon, A 45-50 35-40 0 52.5-55 135-140 0 0 0 0 0 Acting Director of Finance(from 9 September 2013)

Parry, R 30-35 125-130 0 195-197.5 350-355 0 0 0 0 0 Medical Director(from 1 February 2014)

Browne, D 95-100 70-75 0 37.5-40 205-210 0 0 0 0 0 Interim Medical Director(from 1 August to 31 January 2014)

Upton, P 60-65 120-125 0 137.5-140 315-320 180-185 0 0 (27.5)-(30) 150-155Medical Director(to 4 August 2013)

Macklin, N 105-110 0 0 42.5-45 150-155 0 0 0 0 0Director of Human Resources(from 15 April 2013) Mid-point of total paid remuneration band of the highest paid Director £182,500 £182,500

Median Total Remuneration £24,468 £26,533

Ratio 7.46 6.88

No bonus payments were made to senior managers in either 2013-14 or 2012-13. Clinical Excellence Awards, previously disclosed as bonuses in 2012-13, are included within ‘salary’. ‘All pension related benefits’ disclosed in the table above represent the increase in pension benefits in the financial year. Pension benefits are calculated as 20 times the annual pension entitlement at age 60 plus the value of any lump sum pension entitlement. These figures are adjusted for inflation.

2013-14 2012-13


ANNEX 1: Salary and Pension Entitlements of Senior Managers (continued)Pension Benefits

Boswell, L 0 - 2.5 2.5 - 5.0 75-80 235-240 1,582 1,480 70Chief Executive

Gibbs, j 0 - 2.5 2.5 - 5.5 35-40 110-115 616 567 36Chief Operating Officer

MacCallum, A 5.0 - 7.5 15.0 - 17.5 40-45 125-130 824 684 124 Nursing Executive & Deputy

McCarthy, E 5.0 - 7.5 15.0 - 17.5 35-40 115-120 695 566 117 Director of Strategy & Development

Simkins, K 0 - 2.5 2.5 - 5.0 50-55 150-155 909 844 46Director of Finance

Upton, P 5.0 - 7.5 20.0 - 22.5 50-55 160-165 1,025 878 128Medical Director(to 4 August 2013)

Macklin, N 2.5 - 5.0 0 5-10 0 78 44 32Director of Human Resources(from 15 April 2013)

Browne, D 2.0 - 2.5 5.0 - 7.5 25-30 75-80 398 345 45 Interim Medical Director(from 4 August 2013 to 31 January 2014)

Parry, R 7.5 - 10.0 27.5 - 30.0 40-45 120-125 732 540 179 Medical Director(from 1 February 2014)

Wheeldon, A 2.5 - 5.0 0 20-25 0 210 174 32 Acting Director of Finance(9 September 2013)

There were no employers’ contributions to stakeholder pensions.

8Real increase

in pension lump sum at aged 60 (bands of £2,500)

£000

Real increase in pension at age 60 (bands of £2,500)

£000

Total accrued pension at

age 60 at 31 March 2014

(bands of £5,000)

£00

Lump sum at age 60 related to accrued

pension at 31 March

2014 (bands of £5,000)

£000

Cash Equivalent

Transfer value at 31 March 2014 as provided by NHSPA

£000

Cash Equivalent

Transfer value at 31 March 2013 as provided by NHSPA

£000

Real increase in Cash

Equivalent Transfer

value

£000

Senior Managers - Name and Title


Over £17 million has been invested in new equipment, IT systems and our buildings over the last year.


9Statement of income and expenditure for the year ended 31 March 2014 2013-14 2012-13 £000s £000s

Gross employee benefits (203,528) (192,317)Other costs (131,035) (122,147)Revenue from patient care activities 293,620 282,809 Other operating revenue 39,199 40,532 Operating surplus (1,744) 8,877

Finance costs: Investment revenue 31 31 Other gains and (losses) (113) (6)Finance costs (1,604) (1,692)Surplus/(deficit) for the financial year (3,430) 7,210 Public dividend capital dividends payable (4,228) (4,285)Retained surplus/(deficit) for the year (7,658) 2,925 Technical accounting adjustments 11,596 6,884 Adjusted retained surplus for the year 3,938 9,809

Statement of financial position as at 31 March 2014 2013-14 2012-13 £000s £000s

Non-current assets 172,772 173,090 Current assets Inventories 7,202 6,745 Trade and other receivables 17,559 12,051 Cash and cash equivalents 11,827 11,628 Creditors Due within one year Trade and other payables (32,924) (26,765)Provisions (430) (408)Borrowings and loans (2,256) (2,237) Net current assets/(liabilities) 978 1,014 Total assets less current liabilities 173,750 174,104 Non-current liabilities Trade and other payables (4,107) (4,870)Provisions (4,280) (4,063)Borrowings and loans (23,568) (24,278)Total non-current liabilities (31,955) (33,211) Total assets employed 141,795 140,893 Financed by taxpayers’ equity: Public dividend capital 166,067 164,563 Retained earnings (70,972) (63,382)Revaluation reserve 46,700 39,712 Total taxpayers’ equity 141,795 140,893

Summary Financial Statements


Financial Statements for the year ended 31 March 2014

Statement of cash flows for the year ended 31 March 2014 2013-14 2012-13 £000s £000s Operating Activities Net cash inflow/(outflow) from operating activities 16,071 19,671 Cash flows from investing activities Interest and revenue received 31 31 Capital Expenditure Net (Payments) for property, plant and equipment (14,727) (12,039)(Payments) for intangible assets (2,001) (2,180)Proceeds of disposal of assets held for sale (PPE) 12 126 Net cash inflow/(outflow) from investing activities (16,685) (14,062) Net cash inflow/(outflow) before financing (614) 5,609 Cash flows from financing activities Net Public dividend capital received/(paid) 1,504 1,200 Loans received/(repaid) to the DH (702) (1,916)Capital element of finance leases and PFI (7) (5)Net cash inflow/(outflow) from financing 795 (721) Net increase/(decrease) in cash and cash equivalents 181 4,888 Cash and cash equivalents at the beginning of the financial year 11,600 6,712 Cash and cash equivalents at the end of the financial year 11,781 11,600

Better Payment Practice Code 2013-14 2012-13 Number £000s Number £000s

Total Trade Invoices paid in year 86,076 157,669 76,912 159,066Total Trade invoices paid within target 81,650 146,276 72,342 151,793Percentage paid within target 94.9% 92.8% 94.1% 95.4%


9

0

50

100

150

200

250

300300

250

200

£M 150

100

50

0

Patient Education Charitable Non-Patient Other Care Training and Care Revenue Activities and research donated services contributions

Breakdown of Revenue

n Service from other organisations 5.106

n Depreciation and Impairments 24.162

n Other 31.662

n Supplies 70.105

n Staff 203.528

334.563

Breakdown of Trust Expenditure (£M)



n Healthcare assistants and other support staff 395

n Medical and dental 646

n Scientific, therapeutic and technical staff 868

n Administration and estates 1178

n Nursing, midwifery and health visiting staff 1858

4945

n Healthcare assistants and other support staff 23,448

n Scientific, therapeutic and technical staff 31,462

n Senior management, administration and estates 36,310

n Nursing, midwifery and health visiting staff 53,049

n Medical and dental 60,911

205,180

Staff Numbers by Group

Breakdown of Payroll Expenditure (£M)


9Independent auditor’s report to the directors of Royal Cornwall Hospitals NHS Trust

We have examined the summary financial statement for the year ended 31 March 2014 which comprises: the Statement of Income and Expenditure; the Statement of Financial Position and the Statement of Cashflows as set out on pages 1-8 of Section 1.

This report is made solely to the Board of Directors of Royal Cornwall Hospitals NHS Trust in accordance with Part II of the Audit Commission Act 1998 and for no other purpose, as set out in paragraph 45 of the Statement of Responsibilities of Auditors and Audited Bodies published by the Audit Commission in March 2010. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Trust’s directors and the Trust as a body, for our audit work, for this report, or for opinions we have formed.

Respective responsibilities of directors and auditorThe directors are responsible for preparing the Annual Report.

Our responsibility is to report to you our opinion on the consistency of the summary financial statement within the Annual Report with the statutory financial statements.

We also read the other information contained in the Annual Report and consider the implications for our report if we become aware of any misstatements or material inconsistencies with the summary financial statement.

We conducted our work in accordance with Bulletin 2008/03 “The auditor’s statement on the summary financial statement in the United Kingdom” issued by the Auditing Practices Board. Our report on the statutory financial statements describes the basis of our opinion on those financial statements.

Opinion on other mattersIn our opinion the summary financial statement is consistent with the statutory financial statements of the Royal Cornwall Hospitals NHS Trust for the year ended 31 March 2014.

Grant Thornton UK LLP

Hartwell House55-61 Victoria StreetBristol BS1 6FT

3 June 2014

10 Financial Statements for the year ended 31 March 2014

STATEMENT OF COMPREHENSIVE INCOME FOR YEAR ENDED 31 MARCH 2014 2013-14 2012-13 Note £000s £000s Gross employee benefits 9.1 (203,528) (192,317) Other operating costs 7 (131,035) (122,147) Revenue from patient care activities 4 293,620 282,809 Other operating revenue 5 39,199 40,532 Operating surplus/(deficit) (1,744) 8,877 Investment revenue 11 31 31 Other gains and (losses) 12 (113) (6) Finance costs 13 (1,604) (1,692) Surplus/(deficit) for the financial year (3,430) 7,210 Public dividend capital dividends payable (4,228) (4,285) Retained surplus/(deficit) for the year (7,658) 2,925 Other comprehensive income Impairments and reversals taken to the Revaluation Reserve (495) (982) Net gain/(loss) on revaluation of property, plant and equipment 7,551 541 Total comprehensive income for the year (602) 2,484 Financial performance for the year Retained surplus/(deficit) for the year (7,658) 2,925 IFRIC 12 adjustment (including IFRIC 12 impairments) 53 100 Impairments (excluding IFRIC 12 impairments) 16 11,316 7,175 Adjustments in respect of Donated Asset/Government Grant Reserve elimination 227 (391) Adjusted retained surplus 3,938 9,809

The Trust’s reported NHS financial performance position is derived from its retained surplus, as adjusted for the following:- (i) The revenue cost of bringing Local Improvement Finance Trust (LIFT) scheme assets onto the Statement of Financial Position due to the introduction of International Financial Reporting Standards (IFRS) accounting in 2009-10. NHS Trusts’ financial performance mea-surement needs to be aligned with the guidance issued by HM Treasury measuring Departmental expenditure. Therefore, the incremental revenue expenditure resulting from the application of IFRS to LIFT, which has no cash impact and is not chargeable for overall budgeting purposes, should be reported as technical. This additional cost is not considered part of the organisation’s operating position; (ii) Impairment charges are not considered part of an NHS Trust’s operating position; and (iii) The revenue impact of the removal of the Donated Asset Reserve and Government Grant Funded Reserve. Donated and Government grant funded assets now incur capital charges, whilst the donations and grants are credited to income. The resultant impact on the Trust’s operating surplus for the year is neutralised by this adjustment.

The notes on pages 109 to 144 form part of this account.



STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2014 31 March 2014 31 March 2013 Note £000s £000s Property, plant and equipment 14 165,174 165,752 Intangible assets 15 6,524 6,024 Trade and other receivables 20.1 1,074 1,314 Total non-current assets 172,772 173,090 Current assets Inventories 19 7,202 6,745 Trade and other receivables 20.1 17,559 12,051 Cash and cash equivalents 21 11,827 11,628 36,588 30,424 Non-current assets held for sale 22 0 0 Total current assets 36,588 30,424 Total assets 209,360 203,514 Current liabilities Trade and other payables 23 (32,924) (26,765) Provisions 26 (430) (408) Borrowings 24 (54) (35) Working capital loan from Department of Health 24 (1,916) (1,916) Capital investment loans from Department of Health 24 (286) (286) Total current liabilities (35,610) (29,410) Net current assets/(liabilities) 978 1,014 Total assets less current liabilities 173,750 174,104 Non-current liabilities Trade and other payables 23 (4,107) (4,870) Provisions 26 (4,280) (4,063) Borrowings 24 (1,558) (1,566) Working capital loan from Department of Health 24 (19,225) (21,141) Capital investment loans from Department of Health 24 (2,785) (1,571) Total non-current liabilities (31,955) (33,211) Total Assets Employed: 141,795 140,893 FINANCED BY: Taxpayers’ equity Public Dividend Capital 166,067 164,563 Retained earnings (70,972) (63,382) Revaluation reserve 46,700 39,712 Total taxpayers’ equity: 141,795 140,893 The notes on pages 109 to 144 form part of this account. The financial statements on pages 105 to 108 were approved by the Board on 2nd June 2014 and signed on its behalf by Chief Executive: Date: 2 June 2014 106 Royal Cornwall Hospitals NHS Trust - Annual Accounts 2013-14

10STATEMENT OF CHANGES IN TAXPAYERS’ EQUITY FOR THE YEAR ENDED 31 MARCH 2014 Public Retained Revaluation Total Dividend earnings reserve reserves capital £000s £000s £000s £000s Balance at 1 April 2013 164,563 (63,382) 39,712 140,893 Changes in taxpayers’ equity for 2013-14 Retained surplus for the year (7,658) (7,658)Net gain/(loss) on revaluation of property, plant and equipment 7,551 7,551 Impairments and reversals (495) (495)Transfers between reserves 68 (68) 0 Reclassification adjustments New PDC Received - cash 1,504 1,504 Total recognised revenue/(expense) for 2013-14 1,504 (7,590) 6,988 902 Balance at 31 March 2014 166,067 (70,972) 46,700 141,795 Balance at 1 April 2012 163,363 (66,495) 40,341 137,209 Changes in taxpayers’ equity for 2012-13 Retained surplus for the year 2,925 2,925 Net gain/(loss) on revaluation of property, plant and equipment 541 541 Impairments and reversals (982) (982)Transfers between reserves 188 (188) 0 Reclassification adjustments New PDC Received - cash 1,200 1,200 Total recognised revenue/(expense) for 2012-13 1,200 3,113 (629) 3,684 Balance at 31 March 2013 164,563 (63,382) 39,712 140,893



STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2014 2013-14 2012-13 Note £000s £000s Cash flows from operating activities Operating surplus/(deficit) (1,744) 8,877 Depreciation and amortisation 7 12,846 13,140 Impairments and reversals 16 11,316 7,220 Donated assets received credited to revenue but non-cash (287) (506)Interest paid (1,506) (1,585)Dividend paid (3,905) (4,336)(Increase)/decrease in inventories (457) (38)(Increase)/decrease in trade and other receivables (5,793) (2,972)Increase/(decrease) in trade and other payables 5,460 (421)Provisions utilised (353) (344)Increase/(decrease) in provisions 494 636 Net cash inflow from operating activities 16,071 19,671 Cash flows from investing activities Interest received 31 31 (Payments) for property, plant and equipment (14,727) (12,039)(Payments) for intangible assets (2,001) (2,180)Proceeds of disposal of assets held for sale (PPE) 12 126 Net cash outflow from investing activities (16,685) (14,062) Net cash inflow before financing (614) 5,609 Cash flows from financing activities Public Dividend Capital received 1,504 1,200 Loans received from Department of Health - new capital investment loans 1,500 2,000 Loans received from Department of Health - new revenue support loans 0 2,000 Loans repaid to Department of Health - capital investment loans (286) (143)Loans repaid to Department of Health - revenue support loans (1,916) (5,773)Capital element of finance leases and on-SOFP LIFT (7) (5)Net Cash inflow/(outflow) from financing activities 795 (721) Net increase in cash and cash equivalents 181 4,888 Cash and cash equivalents (and bank overdraft) at beginning of the period 11,600 6,712 Cash and cash equivalents (and bank overdraft) at year end 21 11,781 11,600


10NOTES TO THE ACCOUNTS 1. Accounting Policies The Secretary of State for Health has directed that the financial statements of NHS trusts shall meet the accounting requirements of the NHS Trusts Manual for Accounts, which shall be agreed with HM Treasury. Consequently, the financial statements have been prepared in accordance with the 2013-14 NHS Trusts Manual for Accounts issued by the Department of Health. The accounting policies contained in that manual follow International Financial Reporting Standards to the extent that they are meaningful and appropriate to the NHS, as determined by HM Treasury, which is advised by the Financial Reporting Advisory Board. Where the NHS Trusts Manual for Accounts permits a choice of accounting policy, the accounting policy which is judged to be most appropriate to the particular circumstances of the Trust for the purpose of giving a true and fair view has been selected. The particular policies adopted by the Trust are described below. They have been applied consistently in dealing with items considered material in relation to the accounts. 1.1 Accounting conventionThese accounts have been prepared under the historical cost convention modified to account for the revaluation of property, plant and equipment, intangible assets, inventories and certain financial assets and financial liabilities. 1.2 Acquisitions and discontinued operationsActivities are considered to be ‘acquired’ only if they are taken on from outside the public sector. Activities are considered to be ‘discontinued’ only if they cease entirely. They are not considered to be ‘discontinued’ if they transfer from one public sector body to another. 1.3 Charitable FundsFor 2013-14, the divergence from the Government Financial Reporting Manual (FReM) that NHS Charitable Funds are not consolidated with NHS trust’s own returns is removed. Under the provisions of IAS 27 Consolidated and Separate Financial Statements, those Charitable Funds that fall under

common control with NHS bodies are consolidated within the entity’s financial statements.

Royal Cornwall Hospitals NHS Trust, as the Corporate Trustee of Royal Cornwall Hospitals Trust NHS Charitable Fund, is deemed to control the activities of the Charity. However in accordance with IAS1 Presentation of Financial Statements, the transactions of the Trust’s Charitable Funds are immaterial in the context of the group and the transactions have not been consolidated. 1.4 Critical accounting judgements and key sources of estimation uncertainty In the application of the Trust’s accounting policies, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from those estimates and the estimates and underlying assumptions are continually reviewed. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. 1.4.1 Critical accounting judgements in applying accounting policiesCritical judgements, apart from those involving estimations (see below), that management have made in the process of applying the Trust’s accounting policies and that have a significant effect on the amounts recognised in the financial statements have been undertaken in relation to the Trust’s leasing arrangements, the estimation of asset lives for depreciation purposes and estimations used for accruals.

Management has concluded that those assets leased to other organisations have not transferred substantially all of the risks and rewards of ownership to the lessees and therefore have decided that the leasing arrangements are operating leases.



Asset lives, other than those identified by professional valuation, have been estimated by management based on their expected useful lives and the Trust’s own accounting policies.

Accruals have been included in the financial statements to the extent that the Trust recognises an obligation at the accounting period end date for which it had not been invoiced. Estimates of accruals are undertaken by management based on the information available at the balance sheet date, together with past experience. 1.4.2 Key sources of estimation uncertainty Key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are contained within the calculation of provisions. Those uncertainties are disclosed in Note 26.

Further uncertainty exists as to the timing and accuracy of accrued expenditure. 1.5 Revenue Revenue in respect of services provided is recognised when, and to the extent that, performance occurs, and is measured at the fair value of the consideration receivable. The main source of revenue for the Trust is from commissioners for healthcare services. Revenue relating to patient care spells that are part-completed at the year end are apportioned across the financial years on the basis of length of stay at the end of the reporting period compared to expected total length of stay incurred to date compared to total expected costs.

Where income is received for a specific activity that is to be delivered in the following year, that income is deferred.

The Trust receives income under the NHS Injury Cost Recovery Scheme, designed to reclaim the cost of treating injured individuals to whom personal injury compensation has subsequently been paid e.g. by an insurer. The Trust recognises the income when it

receives notification from the Department of Work and Pension’s Compensation Recovery Unit that the individual has lodged a compensation claim. The income is measured at the agreed tariff for the treatments provided to the injured individual, less a provision for unsuccessful compensation claims and doubtful debts.

1.6 Employee benefits Short-term employee benefitsSalaries, wages and employment-related payments are recognised in the period in which the service is received from employees. The cost of leave earned but not taken by employees at the end of the period is recognised in the financial statements to the extent that employees are permitted to carry forward leave into the following period. Retirement benefit costsPast and present employees are covered by the provisions of the NHS Pensions Scheme. The scheme is an unfunded, defined benefit scheme that covers NHS employers, General Practices and other bodies, allowed under the direction of the Secretary of State, in England and Wales. The scheme is not designed to be run in a way that would enable NHS bodies to identify their share of the underlying scheme assets and liabilities. Therefore, the scheme is accounted for as if it were a defined contribution scheme: the cost to the NHS body of participating in the scheme is taken as equal to the contributions payable to the scheme for the accounting period.

For early retirements other than those due to ill health, the additional pension liabilities are not funded by the scheme. The full amount of the liability for the additional costs is charged to expenditure at the time the Trust commits itself to the retirement, regardless of the method of payment. The Trust also makes contributions to an occupational pension scheme set up in accordance with the Automatic Enrolment (Miscellaneous Amendments) Regulations 2012. The scheme is a defined contribution scheme, for which the Trust accounts for its employer contributions within ‘other pension costs’ in these financial statements.


101.7 Other expensesOther operating expenses are recognised when, and to the extent that, the goods or services have been received. They are measured at the fair value of the consideration payable. 1.8 Property, plant and equipment RecognitionProperty, plant and equipment is capitalised if:

p it is held for use in delivering services or for administrative purposes;p it is probable that future economic benefits will flow to, or service potential will be supplied to the Trust;p it is expected to be used for more than one financial year;p the cost of the item can be measured reliably; andp the item has cost of at least £5,000; orp collectively, a number of items have a cost of at least £5,000 and individually have a cost of more than £250, where the assets are functionally interdependent, they had broadly simultaneous purchase dates, are anticipated to have simultaneous disposal dates and are under single managerial control; orp items form part of the initial equipping and setting-up cost of a new building, ward or unit, irrespective of their individual or collective cost. Where a large asset, for example a building, includes a number of components with significantly different asset lives, the components are treated as separate assets and depreciated over their own useful economic lives. ValuationAll property, plant and equipment are measured initially at cost, representing the cost directly attributable to acquiring or constructing the asset and bringing it to the location and condition necessary for it to be capable of operating in the manner intended by management. All assets are measured subsequently at fair value.

Land and buildings used for the Trust’s services or

for administrative purposes, information technology assets purchased prior to 31 December 2013 and plant and machinery assets purchased prior to 1 April 2009, are stated in the Statement of Financial Position at their revalued amounts, being the fair value at the date of revaluation less any impairment less subsequent accumulated depreciation and impairment losses. Revaluations are performed with sufficient regularity to ensure that carrying amounts are not materially different from those that would be determined at the end of the reporting period. Fair values are determined as follows:

p Land and non-specialised buildings – market value for existing usep Specialised buildings – depreciated replacement costp Plant and machinery and information technology asset - market value

Until 31 March 2008, the depreciated replacement cost of specialised buildings has been estimated for an exact replacement of the asset in its present location. HM Treasury has adopted a standard approach to depreciated replacement cost valuations based on modern equivalent assets and, where it would meet the location requirements of the service being provided, an alternative site can be valued. Properties in the course of construction for service or administration purposes are carried at cost, less any impairment loss. Cost includes professional fees but not borrowing costs, which are recognised as expenses immediately, as allowed by IAS 23 Borrowing Costs for assets held at fair value. Assets are revalued and depreciation commences when they are brought into use.

Until 31 March 2008, fixtures and equipment were carried at replacement cost, as assessed by indexation and depreciation of historic cost. From 1 April 2008 indexation has ceased. The carrying value of existing assets at that date will be written off over their remaining useful lives and new fixtures and equipment, that are not subject to revaluation, are carried at depreciated historic cost as this is not considered to be materially different from fair value.



An increase arising on revaluation is taken to the revaluation reserve except when it reverses an impairment for the same asset previously recognised in expenditure, in which case it is credited to expenditure to the extent of the decrease previously charged there. A revaluation decrease that does not result from a loss of economic value or service potential is recognised as an impairment charged to the revaluation reserve to the extent that there is a balance on the reserve for the asset and, thereafter, to expenditure. Impairment losses that arise from a clear consumption of economic benefit should be taken to expenditure. Gains and losses recognised in the revaluation reserve are reported as other comprehensive income in the Statement of Comprehensive Income.

Subsequent expenditureWhere subsequent expenditure enhances an asset beyond its original specification, the directly attributable cost is capitalised. Where subsequent expenditure restores the asset to its original specification, the expenditure is capitalised and any existing carrying value of the item replaced is written-out and charged to operating expenses.

1.9 Intangible assets

RecognitionIntangible assets are non-monetary assets without physical substance, which are capable of sale separately from the rest of the Trust’s business or which arise from contractual or other legal rights. They are recognised only when it is probable that future economic benefits will flow to, or service potential be provided to, the Trust; where the cost of the asset can be measured reliably, and where the cost is at least £5,000.

Intangible assets acquired separately are initially recognised at fair value. Software that is integral to the operating of hardware, for example an operating system, is capitalised as part of the relevant item of property, plant and equipment. Software that is not integral to the operation of hardware, for example application software, is capitalised as an intangible asset. Expenditure on research is not capitalised: it is recognised as an operating expense in the period

in which it is incurred. Internally-generated assets are recognised if, and only if, all of the following have been demonstrated:

p the technical feasibility of completing the intangible asset so that it will be available for use;p the intention to complete the intangible asset and use it;p the ability to sell or use the intangible asset;p how the intangible asset will generate probable future economic benefits or service potential;p the availability of adequate technical, financial and other resources to complete the intangible asset and sell or use it; andp the ability to measure reliably the expenditure attributable to the intangible asset during its development.

MeasurementThe amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the criteria above are initially met. Where no internally-generated intangible asset can be recognised, the expenditure is recognised in the period in which it is incurred.

Following initial recognition, intangible assets are carried at fair value by reference to an active market, or, where no active market exists, at amortised replacement cost (modern equivalent assets basis), indexed for relevant price increases, as a proxy for fair value. Internally-developed software is held at historic cost to reflect the opposing effects of increases in development costs and technological advances.

1.10 Depreciation, amortisation and impairmentsFreehold land, properties under construction, and assets held for sale are not depreciated. Otherwise, depreciation and amortisation are charged to write off the costs or valuation of property, plant and equipment and intangible non-current assets, less any residual value, over their estimated useful lives, in a manner that reflects the consumption of economic benefits or service


10potential of the assets. The estimated useful life of an asset is the period over which the Trust expects to obtain economic benefits or service potential from the asset. This is specific to the Trust and may be shorter than the physical life of the asset itself. Estimated useful lives and residual values are reviewed each year end, with the effect of any changes recognised on a prospective basis. Assets held under finance leases are depreciated over their estimated useful lives. At each reporting period end, the Trust checks whether there is any indication that any of its tangible or intangible non-current assets have suffered an impairment loss. If there is indication of an impairment loss, the recoverable amount of the asset is estimated to determine whether there has been a loss and, if so, its amount. Intangible assets not yet available for use are tested for impairment annually. A revaluation decrease that does not result from a loss of economic value or service potential is recognised as an impairment charged to the revaluation reserve to the extent that there is a balance on the reserve for the asset and, thereafter, to expenditure. Impairment losses that arise from a clear consumption of economic benefit should be taken to expenditure. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of the recoverable amount but capped at the amount that would have been determined had there been no initial impairment loss. The reversal of the impairment loss is credited to expenditure to the extent of the decrease previously charged there and thereafter to the revaluation reserve. Impairments are analysed between Departmental Expenditure Limits (DEL) and Annually Managed Expenditure (AME) from 2011-12. This is necessary to comply with Treasury’s budgeting guidance. DEL limits are set in the Spending Review and Departments may not exceed the limits that they have been set.

AME budgets are set by the Treasury and may be reviewed with departments in the run-up to the

Budget. Departments need to monitor AME closely and inform Treasury if they expect AME spending to rise above forecast. Whilst Treasury accepts that in some areas of AME inherent volatility may mean departments do not have the ability to manage the spending within budgets in that financial year, any expected increases in AME require Treasury approval. 1.11 Donated assetsDonated non-current assets are capitalised at their fair value on receipt, with a matching credit to Income. They are valued, depreciated and impaired as described above for purchased assets. Gains and losses on revaluations, impairments and sales are as described above for purchased assets. Deferred income is recognised only where conditions attached to the donation preclude immediate recognition of the gain. 1.12 Government grants The value of assets received by means of a Government grant are credited directly to income. Deferred income is recognised only where conditions attached to the grant preclude immediate recognition of the gain. 1.13 Non-current assets held for saleNon-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met when the sale is highly probable, the asset is available for immediate sale in its present condition and management is committed to the sale, which is expected to qualify for recognition as a completed sale within one year from the date of classification. Non-current assets held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell. Fair value is open market value including alternative uses.

The profit or loss arising on disposal of an asset is the difference between the sale proceeds and the carrying amount and is recognised in the Statement of Comprehensive Income. On disposal, the balance for the asset on the revaluation reserve is transferred to retained earnings.



Property, plant and equipment that is to be scrapped or demolished does not qualify for recognition as held for sale. Instead, it is retained as an operational asset and its economic life is adjusted. The asset is de-recognised when it is scrapped or demolished. 1.14 LeasesLeases are classified as finance leases when substantially all the risks and rewards of ownership are transferred to the lessee. All other leases are classified as operating leases. The Trust as lesseeProperty, plant and equipment held under finance leases are initially recognised, at the inception of the lease, at fair value or, if lower, at the present value of the minimum lease payments, with a matching liability for the lease obligation to the lessor. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate on interest on the remaining balance of the liability. Finance charges are recognised in calculating the Trust’s surplus/deficit. Operating lease payments are recognised as an expense on a straight-line basis over the lease term. Lease incentives are recognised initially as a liability and subsequently as a reduction of rentals on a straight-line basis over the lease term. Contingent rentals are recognised as an expense in the period in which they are incurred. Where a lease is for land and buildings, the land and building components are separated and individually assessed as to whether they are operating or finance leases. The Trust as lessorAmounts due from lessees under finance leases are recorded as receivables at the amount of the Trust’s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Trust’s net investment outstanding in respect of the leases. Rental income from operating leases is recognised

on a straight-line basis over the term of the lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

1.15 InventoriesInventories are valued at the lower of cost and net realisable value using the weighted average cost formula. This is considered to be a reasonable approximation to fair value due to the high turnover of stocks. 1.16 Cash and cash equivalentsCash is cash in hand and deposits with any financial institution repayable without penalty on notice of not more than 24 hours. Cash equivalents are investments that mature in 3 months or less from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and that form an integral part of the Trust’s cash management.

1.17 ProvisionsProvisions are recognised when the Trust has a present legal or constructive obligation as a result of a past event, it is probable that the Trust will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the expenditure required to settle the obligation at the end of the reporting period, taking into account the risks and uncertainties. Where a provision is measured using the cash flows estimated to settle the obligation, its carrying amount is the present value of those cash flows using HM Treasury’s discount rates as follows: p post employment provisions: 1.8%p other provisions, depending on expected timing of cash flows: p 0 to 5 years inclusive: -1.9% p 6 to 10 years inclusive -0.65% p over 10 years: +2.20%


10When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursements will be received and the amount of the receivable can be measured reliably. A restructuring provision is recognised when the Trust has developed a detailed formal plan for the restructuring and has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or announcing its main features to those affected by it. The measurement of a restructuring provision includes only the direct expenditures arising from the restructuring, which are those amounts that are both necessarily entailed by the restructuring and not associated with on-going activities of the entity. 1.18 Clinical negligence costsThe NHS Litigation Authority (NHSLA) operates a risk pooling scheme under which the Trust pays an annual contribution to the NHSLA which in return settles all clinical negligence claims. The contribution is charged to expenditure. Although the NHSLA is administratively responsible for all clinical negligence cases the legal liability remains with the Trust. The total value of clinical negligence provisions carried by the NHSLA on behalf of the Trust is disclosed at Note 26.

1.19 Non-clinical risk poolingThe Trust participates in the Property Expenses Scheme and the Liabilities to Third Parties Scheme. Both are risk pooling schemes under which the Trust pays an annual contribution to the NHS Litigation Authority and, in return, receives assistance with the costs of claims arising. The annual membership contributions, and any excesses payable in respect of particular claims are charged to operating expenses as and when they become due. 1.2 Carbon Reduction Commitment Scheme (CRC)CRC and similar allowances are accounted for as government grant funded intangible assets if they are not expected to be realised within twelve months, and otherwise as other current assets. They

are valued at open market value. As the NHS body makes emissions, a provision is recognised with an offsetting transfer from deferred income. The provision is settled on surrender of the allowances. The asset, provision and deferred income amounts are valued at fair value at the end of the reporting period. 1.21 ContingenciesA contingent liability is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Trust, or a present obligation that is not recognised because it is not probable that a payment will be required to settle the obligation or the amount of the obligation cannot be measured sufficiently reliably. A contingent liability is disclosed unless the possibility of a payment is remote.

A contingent asset is a possible asset that arises from past events and whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Trust. A contingent asset is disclosed where an inflow of economic benefits is probable. Where the time value of money is material, contingencies are disclosed at their present value. 1.22 Financial assets Financial assets are recognised when the Trust becomes party to the financial instrument contract or, in the case of trade receivables, when the goods or services have been delivered. Financial assets are derecognised when the contractual rights have expired or the asset has been transferred. Financial assets are initially recognised at fair value. Financial assets are classified into the following categories: financial assets at fair value through profit and loss; held to maturity investments; available for sale financial assets, and loans and receivables. The classification depends on the nature and purpose of the financial assets and is



determined at the time of initial recognition. The only financial assets held by the Trust are ‘Loans and receivables’. Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments which are not quoted in an active market. After initial recognition, they are measured at amortised cost using the effective interest method, less any impairment. Interest is recognised using the effective interest method. Fair value is determined by reference to quoted market prices where possible, otherwise by valuation techniques as specified in the NHS Manual for Accounts. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, to the initial fair value of the financial asset. At the end of the reporting period, the Trust assesses whether any financial assets, other than those held at ‘fair value through profit and loss’ are impaired. Financial assets are impaired and impairment losses recognised if there is objective evidence of impairment as a result of one or more events which occurred after the initial recognition of the asset and which has an impact on the estimated future cash flows of the asset.

For financial assets carried at amortised cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the revised future cash flows discounted at the asset’s original effective interest rate. The loss is recognised in expenditure and the carrying amount of the asset is reduced directly or through a provision for impairment of receivables. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through expenditure to the extent that the carrying amount

of the receivable at the date of the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. 1.23 Financial liabilities Financial liabilities are recognised on the statement of financial position when the Trust becomes party to the contractual provisions of the financial instrument or, in the case of trade payables, when the goods or services have been received. Financial liabilities are de-recognised when the liability has been discharged, that is, the liability has been paid or has expired. Loans from the Department of Health are recognised at historical cost. Otherwise, financial liabilities are initially recognised at fair value.

1.24 Value Added TaxMost of the activities of the Trust are outside the scope of VAT and, in general, output tax does not apply and input tax on purchases is not recoverable. Irrecoverable VAT is charged to the relevant expenditure category or included in the capitalised purchase cost of fixed assets. Where output tax is charged or input VAT is recoverable, the amounts are stated net of VAT.

1.25 Foreign currenciesThe Trust’s functional currency and presentational currency is sterling. Transactions denominated in a foreign currency are translated into sterling at the exchange rate ruling on the dates of the transactions. At the end of the reporting period, monetary items denominated in foreign currencies are retranslated at the spot exchange rate on 31 March. Resulting exchange gains and losses for either of these are recognised in the Trust’s surplus/deficit in the period in which they arise.

1.26 Third party assetsAssets belonging to third parties (such as money held on behalf of patients) are not recognised in the accounts since the Trust has no beneficial interest in them. 1.27 Public Dividend Capital (PDC) and PDC dividend


10Public dividend capital represents taxpayers’ equity in the NHS Trust. At any time the Secretary of State can issue new PDC to, and require repayments of PDC from, the Trust. PDC is recorded at the value received. As PDC is issued under legislation rather than under contract, it is not treated as an equity financial instrument. An annual charge, reflecting the cost of capital utilised by the Trust, is payable to the Department of Health as public dividend capital dividend. The charge is calculated at the real rate set by HM Treasury (currently 3.5%) on the average carrying amount of all assets less liabilities (except for donated assets, net assets transferred from NHS bodies dissolved on 1 April 2013 and cash balances with the Government Banking Service). The average carrying amount of assets is calculated as a simple average of opening and closing relevant net assets, with the exception of the cash balances with the Government Banking Service, which are calculated based on a daily average throughout the year.

1.28 Losses and special paymentsLosses and special payments are items that Parliament would not have contemplated when it agreed funds for the health service or passed legislation. By their nature they are items that ideally should not arise. They are therefore subject to special control procedures compared with the generality of payments. They are divided into different categories, which govern the way that individual cases are handled. Losses and special payments are charged to the relevant functional headings in expenditure on an accruals basis, including losses which would have been made good through insurance cover had trusts not been bearing their own risks (with insurance premiums then being included as normal revenue expenditure). 1.29 SubsidiariesMaterial entities over which the Trust has the power to exercise control so as to obtain economic or other benefits are classified as subsidiaries and are consolidated. Their income and expenses; gains and losses; assets, liabilities and reserves; and cash flows

are consolidated in full into the appropriate financial statement lines. Appropriate adjustments are made on consolidation where the subsidiary’s accounting policies are not aligned with the Trust or where the subsidiary’s accounting date is not co-terminus.

The Board of Royal Cornwall Hospitals NHS Trust acts as the Corporate Trustee of Royal Cornwall Hospitals Charitable Fund (Charity number 1049687). As Corporate Trustee, the Board of Royal Cornwall Hospitals NHS Trust is deemed to have the power to govern the financial and operational policies of the Charity so as to obtain benefits from its activities.

Following HM Treasury’s instructions to apply IAS 27 Consolidation and Separate Financial Statements from 1 April 2013, the Trust considered the requirement to consolidate with these financial statements, the financial statements of the Charity. However, the Trust has determined that as the transactions and balances of the Charity are immaterial in the context of the group, the financial statements of the Charity have not been consolidated.

Details of the transactions between the Trust and the Charity are disclosed within Note 33 as related party transactions. 1.30 Research and development Research and development expenditure is charged against income in the year in which it is incurred, except insofar as development expenditure relates to a clearly defined project and the benefits of it can reasonably be regarded as assured. Expenditure so deferred is limited to the value of future benefits expected and is amortised through the Statement of Comprehensive Income on a systematic basis over the period expected to benefit from the project. It should be revalued on the basis of current cost. The amortisation is calculated on the same basis as depreciation, on a quarterly basis. 1.31 Accounting Standards that have been issued but have not yet been adoptedThe Treasury FReM does not require the following Standards and Interpretations to be applied in 2013-14. The application of the Standards as revised



would not have a material impact on the accounts for 2013-14, were they applied in that year:

p IAS 27 Separate Financial Statements - subject to consultationp IAS 28 Investments in Associates and Joint Ventures - subject to consultationp IFRS 9 Financial Instruments - subject to consultationp IFRS 10 Consolidated Financial Statements - subject to consultationp IFRS 11 Joint Arrangements - subject to consultationp IFRS 12 Disclosure of Interests in Other Entities - subject to consultationp IFRS 13 Fair Value Measurement - subject to consultationp IPSAS 32 - Service Concession Arrangements - subject to consultation

2. Operating segments The Trust has considered IFRS8 Operating Segments and has taken the view that its activities should be reported as a single entity rather than in a segmental manner. Although financial performance is reported to the Chief Executive at a divisional level, the key financial information for decision making purposes is based on the entity as a whole. Furthermore, the Trust’s business is the delivery of acute healthcare across a single economic environment. No separate reportable segments have therefore been identified. 3. Income generation activities The Trust has undertaken no material income generating activities in the current or preceding year.


104. Revenue from patient care activities 2013-14 2012-13 £000s £000s NHS trusts 7 0 NHS England 58,767 Clinical commissioning groups 230,419 Primary care trusts 280,720 NHS foundation trusts 39 0 Total revenue from NHS bodies 289,232 280,720 Non-NHS: Local authorities 3,024 0 Private patients 529 578 Overseas patients (non-reciprocal) 120 126 Injury costs recovery 583 819 Other 132 566 Total revenue from patient care activities 293,620 282,809 5. Other operating revenue 2013-14 2012-13 £000s £000sRecoveries in respect of employee benefits * 963 893 Education, training and research 15,592 13,318 Charitable and other contributions to revenue expenditure - NHS* 61 80 Charitable and other contributions to revenue expenditure -non- NHS* 215 189 Receipt of donations for capital acquisitions - NHS Charity 362 977 Non-patient care services to other bodies 9,686 8,143 Rental revenue from operating leases 1,145 1,116 Other revenue ** 11,175 15,816 Total other operating revenue 39,199 40,532 Total operating revenue 332,819 323,341 * Included within Charitable and other contributions to revenue expenditure is £140,000 (2012-13: £176,000) in relation to recoveries in respect of employee benefits, comprising £50,000 (2012-13: £63,000) NHS and £90,000 (2012-13: £113,000) non-NHS income. ** Other revenue in 2012-13 included £6,000,000 additional income agreed with Cornwall & Isles of Scilly Primary Care Trust. 6. Revenue Revenue is almost totally from the supply of services. Revenue from the sale of goods is immaterial.



7. Operating expenses 2013-14 2012-13 £000s £000s Restated* Services from other NHS trusts 834 705 Services from NHS foundation trusts 1,304 3,092 Total services from NHS bodies** 2,138 3,797 Purchase of healthcare from non-NHS bodies 2,968 2,617 Trust Chair and non-executive directors 61 69 Supplies and services - clinical 65,348 61,302 Supplies and services - general 4,757 3,828 Consultancy services 237 211 Establishment 4,139 3,905 Transport 1,469 1,584 *Premises 9,261 7,701 *Insurance 110 92 *Legal Fees 264 278 *Impairments and reversals of receivables 58 79 Inventories write down 65 0 Depreciation 11,152 11,963 Amortisation 1,694 1,177 Impairments and reversals of property, plant and equipment 11,316 7,220 Audit fees*** 114 120 Clinical negligence 5,904 6,473 Research and development (excluding staff costs) 742 661 Education and training 737 498 Change in discount rate 210 160 *Other 8,291 8,412 * Total operating expenses (excluding employee benefits) 131,035 122,147 Employee benefits Employee benefits excluding Board members 202,441 191,265 Board members 1,087 1,052 Total employee benefits 203,528 192,317 Total operating expenses 334,563 314,464 * Balances have been restated under the revised 2013-14 expenditure headings. Insurance costs were previously disclosed within Transport, Premises and Other operating expenses. Legal Fees were previously disclosed in Other operating expenses. The costs arising from the change in the provisions discount rate were previously disclosed within Other operating expenses. **Services from NHS bodies do not include expenditure which falls into one of the other operating expense headings shown within this note. ***Audit fees in 2013-14 include a rebate from the Audit Commission of £14,000, relating to the 2012-13 financial year.


108. Operating leases The Trust leases equipment, vehicles and property under operating lease arrangements. There are no individually material leases. The lease terms range from 1 to 5 years and are arranged under standard NHS terms and conditions.

Some of the leasing arrangements contain provisions for the option to renew or purchase at the end of the arrangement.

8.1 The Trust as lessee 2013-14 2012-13 Buildings Other Total Total £000s £000s £000s £000s Restated Payments recognised as an expense Minimum lease payments 1,300 1,307 Total 1,300 1,307 Payable: No later than one year 141 827 968 1,110 Between one and five years 277 644 921 1,026 After five years 0 0 0 0 Total 418 1,471 1,889 2,136 Total future sublease payments expected to be received: 0 0 8.2 The Trust as lessor The Trust has three significant lessor arrangements: for the leasing of the main hospital site car park (8 years remaining), space within the Knowledge Spa (15 years remaining) and space within the Peninsula Dental School (21 years remaining). The Trust also leases some land and some retail space on the main hospital site on a nominal rental basis. These leases have 97 and 5 years remaining respectively. 2013-14 2012-13 £000 £000sRecognised as revenue Rental revenue 1,145 1,116 Total 1,145 1,116 Receivable: No later than one year 1,113 1,117 Between one and five years 4,139 4,354 After five years 7,097 8,094 Total 12,349 13,565



9. Employee benefits and staff numbers 9.1 Employee benefits 2013-14 Permanently Total employed Other £000s £000s £000s Employee benefits - Gross expenditure: 2013-14 Salaries and wages 172,195 157,613 14,582 Social security costs 12,650 12,650 0 Employer contributions to NHS BSA - Pensions Division 20,086 20,086 0 Other pension costs 152 152 0 Termination benefits 97 97 0 Total employee benefits 205,180 190,598 14,582 Employee costs capitalised 1,652 1,652 0 Gross employee benefits excluding capitalised costs 203,528 188,946 14,582 2012-13 Permanently Total employed Other £000s £000s £000s Employee benefits - Gross expenditure: 2012-13 Salaries and wages 162,355 152,070 10,285 Social security costs 12,259 12,259 0 Employer contributions to NHS BSA - Pensions Division 19,284 19,284 0 Other pension costs 95 95 0 Total employee benefits 193,993 183,708 10,285 Employee costs capitalised 1,676 1,676 0 Gross employee benefits excluding capitalised costs 192,317 182,032 10,285 Recoveries in respect of employee benefits for both 2013-14 and 2012-13 are disclosed in Note 5. 2013-14 9.2 Staff numbers Permanently 2012-13 Total employed Other Total Number Number Number NumberAverage staff numbers Medical and dental 646.2 600.0 46.2 625.2 Administration and estates 1,177.3 1,119.7 57.6 1,083.0 Healthcare assistants and other support staff 394.8 394.8 0.0 382.5 Nursing, midwifery and health visiting staff 1,254.6 1,196.4 58.2 1,231.9 Nursing, midwifery and health visiting learners 603.4 516.5 86.9 555.5 Scientific, therapeutic and technical staff 868.3 845.3 23.0 831.3 TOTAL 4,944.6 4,672.7 271.9 4,709.4 Of the above - staff engaged on capital projects 35.4 35.4 0.0 36.5


109.3 Staff sickness absence and ill health retirements 2013-14 2012-13 Number Number Total days lost 46,288 44,687 Total staff years 4,649 4,497 Average working days lost 10 10 Note: the sickness figures provided are based on the 2013 calendar year, which the Department of Health regards as a reasonable proxy for the financial year. 2013-14 2012-13 Number NumberNumber of persons retired early on ill health grounds 9 6 £000s £000sTotal additional pensions liabilities accrued in the year 887 151 9.4 Exit packages agreed in 2013-14 2013-14 Number of Number of other Total number Total cost compulsory departures of exit packages of exit redundancies agreed by cost band packagesExit package cost band (including any special payment element) Number Number Number £Less than £10,000 0 14 14 31,398 £10,000-£25,000 0 1 1 15,430 £25,001-£50,000 0 1 1 49,950 Total number of exit packages by type (total cost) 0 16 16 96,778 Total resource cost (£000s) 0 97 97 97 Exit costs in this note are accounted for in full in the year of departure. Where the Trust has agreed early retirements, the additional costs are met by the Trust and not by the NHS pensions scheme. Ill-health retirement costs are met by the NHS pensions scheme and are not included in the table. This disclosure reports the number and value of exit packages agreed in the year. Note: The expense associated with these departures may have been recognised in part or in full in a previous period.

9.5 Exit packages - other departures analysis 2013-14 Agreements Total value of agreements Number £000s Voluntary redundancies including early retirement contractual costs 1 41 Contractual payments in lieu of notice 16 56 Total 17 97 This disclosure reports the number and value of exit packages agreed in the year. Note: the expense associated with these departures may have been recognised in part or in full in a previous period As a single exit package can be made up of several components each of which will be counted separately in this note, the total number above will not necessarily match the total numbers in Note 9.4 which will be the number of individuals. The Remuneration Report includes disclosure of exit payments payable to individuals named in that Report. 2012-13: The Trust neither paid nor agreed any exit packages in 2012-13



9.6 Pension costs Past and present employees are covered by the provisions of the NHS Pensions Scheme. Details of the benefits payable under these provisions can be found on the NHS Pensions website at www.nhsbsa.nhs.uk/pensions. The scheme is an unfunded, defined benefit scheme that covers NHS employers, GP practices and other bodies, allowed under the direction of the Secretary of State, in England and Wales. The scheme is not designed to be run in a way that would enable NHS bodies to identify their share of the underlying scheme assets and liabilities. Therefore, the scheme is accounted for as if it were a defined contribution scheme: the cost to the NHS Body of participating in the scheme is taken as equal to the contributions payable to the scheme for the accounting period.

In order that the defined benefit obligations recognised in the financial statements do not differ materially from those that would be determined at the reporting date by a formal actuarial valuation, the FReM requires that “the period between formal valuations shall be four years, with approximate assessments in intervening years”. An outline of these follows: a) Accounting valuation A valuation of the scheme liability is carried out annually by the scheme actuary as at the end of the reporting period. This utilises an actuarial assessment for the previous accounting period in conjunction with updated membership and financial data for the current reporting period, and are accepted as providing suitably robust figures for financial reporting purposes. The valuation of the scheme liability as at 31 March 2014, is based on valuation data as 31 March 2013, updated to 31 March 2014 with summary global member and accounting data. In undertaking this actuarial assessment, the methodology prescribed in IAS 19, relevant FReM interpretations, and the discount rate prescribed by HM Treasury have also been used. The latest assessment of the liabilities of the scheme is contained in the scheme actuary report, which forms part of the annual NHS Pension Scheme (England and Wales) Pension Accounts, published

annually. These accounts can be viewed on the NHS Pensions website. Copies can also be obtained from The Stationery Office. b) Full actuarial (funding) valuation The purpose of this valuation is to assess the level of liability in respect of the benefits due under the scheme (taking into account its recent demographic experience), and to recommend the contribution rates. The last published actuarial valuation undertaken for the NHS Pension Scheme was completed for the year ending 31 March 2004. Consequently, a formal actuarial valuation would have been due for the year ending 31 March 2008. However, formal actuarial valuations for unfunded public service schemes were suspended by HM Treasury on value for money grounds while consideration is given to recent changes to public service pensions, and while future scheme terms are developed as part of the reforms to public service pension provision due in 2015. The Scheme Regulations were changed to allow contribution rates to be set by the Secretary of State for Health, with the consent of HM Treasury, and consideration of the advice of the Scheme Actuary and appropriate employee and employer representatives as deemed appropriate. The next formal valuation to be used for funding purposes will be carried out at as at March 2012 and will be used to inform the contribution rates to be used from 1 April 2015.

c) Scheme provisions The NHS Pension Scheme provided defined benefits, which are summarised below. This list is an illustrative guide only, and is not intended to detail all the benefits provided by the Scheme or the specific conditions that must be met before these benefits can be obtained: The Scheme is a “final salary” scheme. Annual pensions are normally based on 1/80th for the 1995 section and of the best of the last three years pensionable pay for each year of service, and 1/60th for the 2008 section of reckonable pay per year of membership. Members who are practitioners


10as defined by the Scheme Regulations have their annual pensions based upon total pensionable earnings over the relevant pensionable service. With effect from 1 April 2008 members can choose to give up some of their annual pension for an additional tax free lump sum, up to a maximum amount permitted under HMRC rules. This new provision is known as “pension commutation”. Annual increases are applied to pension payments at rates defined by the Pensions (Increase) Act 1971, and are based on changes in retail prices in the twelve months ending 30 September in the previous calendar year. From 2011-12 the Consumer Price Index (CPI) has been used and replaced the Retail Prices Index (RPI). Early payment of a pension, with enhancement, is available to members of the scheme who are permanently incapable of fulfilling their duties effectively through illness or infirmity. A death gratuity of twice final year’s pensionable pay for death in service, and five times their annual pension for death after retirement is payable. For early retirements other than those due to ill health the additional pension liabilities are not funded by the scheme. The full amount of the liability for the additional costs is charged to the employer. Members can purchase additional service in the NHS Scheme and contribute to money purchase AVC’s run by the Scheme’s approved providers or by other Free Standing Additional Voluntary Contributions (FSAVC) providers.



10. Better Payment Practice Code

10.1 Measure of compliance 2013-14 2013-14 2012-13 2012-13 Number £000s Number £000sNon-NHS payables Total Non-NHS trade invoices paid in the year 83,779 117,322 74,161 99,980 Total Non-NHS trade invoices paid within target 79,490 106,767 69,731 93,491 Percentage of Non-NHS trade invoices paid within target 94.9% 91.0% 94.0% 93.5% NHS payables Total NHS trade invoices paid in the year 2,297 40,347 2,751 59,086 Total NHS trade invoices paid within target 2,160 39,509 2,611 58,302 Percentage of NHS trade invoices paid within target 94.0% 97.9% 94.9% 98.7% The Better Payment Practice Code requires the NHS body to aim to pay all valid invoices by the due date or within 30 days of receipt of a valid invoice, whichever is later. 10.2 The Late Payment of Commercial Debts (Interest) Act 1998 The Trust has not incurred any finance costs, or paid any compensation to cover debt recovery costs under this legislation, in either 2013-14 or 2012-13. 11. Investment revenue 2013-14 2012-13 £000s £000sInterest revenue Bank interest 31 31 Total investment revenue 31 31 12. Other gains and losses 2013-14 2012-13 £000s £000s Losses on disposal of property, plant and equipment (113) (6)Total (113) (6) 13. Finance costs 2013-14 2012-13 £000s £000sInterest Interest on loans and overdrafts 1,125 1,212 - main finance cost 330 331 - contingent finance cost 51 42 Total interest expense 1,506 1,585 Provisions - unwinding of discount 98 107 Total finance costs 1,604 1,692


1014.1 Property, plant and Asset under equipment: 2013-14 Buildings construction excluding & payments Plant & Transport Information Furniture & Land Dwellings Dwellings on account machinery Equipment technology fittings Total £000s £000s £000s £000s £000s £000s £000s £000s £000s Cost or valuation: At 1 April 2013 16,691 122,974 995 2,460 70,498 373 34,583 6,035 254,607Additions of assets under construction 569 569Additions purchased 0 10,153 0 2,143 0 1,534 374 14,204 Additions donated 0 0 0 0 216 0 17 24 257 Additions from cash donations 0 0 0 0 75 0 0 0 75 Reclassifications 0 2,259 0 (2,460) 242 0 (347) 0 (306)Disposals other than for sale 0 0 0 0 (1,690) 0 (6,349) 0 (8,039)Revaluation adjustments 0 (4,178) 26 0 0 0 (24,910) 0 (29,062)Impairments (250) (11) (23) 0 0 0 (211) 0 (495)At 31 March 2014 16,441 131,197 998 569 71,484 373 4,317 6,431 231,810 Depreciation: At 1 April 2013 0 11,647 56 0 49,497 339 22,710 4,606 88,855 Reclassifications 0 33 0 0 0 (193) 0 (160)Disposals other than for sale 0 0 0 (1,685) 0 (6,229) 0 (7,914)Revaluation adjustments 0 (11,647) (56) 0 0 (24,910) 0 (36,613)Impairments 0 6,845 0 0 0 0 6,175 0 13,020 Reversal of impairments 0 (1,704) 0 0 0 0 0 0 (1,704)Charged during the year 0 4,274 55 3,928 20 2,488 387 11,152 At 31 March 2014 0 9,448 55 0 51,740 359 41 4,993 66,636 Net book value at 31 March 2014 16,441 121,749 943 569 19,744 14 4,276 1,438 165,174 Asset financing: Owned - purchased 16,191 109,057 936 569 18,746 14 3,968 1,372 150,853 Owned - donated 0 7,280 7 0 998 0 308 66 8,659 Owned - government granted 0 4,362 0 0 0 0 0 0 4,362 On-SOFP LIFT contracts 250 1,050 0 0 0 0 0 0 1,300 Total at 31 March 2014 16,441 121,749 943 569 19,744 14 4,276 1,438 165,174

Revaluation Reserve balance for property, plant and equipment Plant & Transport Information Furniture & Land Dwellings Dwellings machinery Equipment technology fittings Total £000s £000s £000s £000s £000s £000s £000s £000s At 1 April 2013 7,901 26,177 1,692 3,518 7 211 134 39,640 Movements - revaluations and disposals (250) 7,286 59 0 0 (211) 0 6,884 At 31 March 2014 7,651 33,463 1,751 3,518 7 0 134 46,524 Additions to assets under construction in 2013-14 £000s Buildings excluding dwellings 569 Plant & machinery 0 Total 569 Royal Cornwall Hospitals NHS Trust - Annual Accounts 2013-14 127


14.2 Property, plant and Asset under equipment: 2012-13 Buildings construction excluding & payments Plant & Transport Information Furniture & Land Dwellings Dwellings on account machinery Equipment technology fittings Total £000s £000s £000s £000s £000s £000s £000s £000s £000s Cost or valuation: At 1 April 2012 16,691 115,309 973 2,925 70,402 373 34,557 5,923 247,153 Additions of assets under construction 2,333 2,333 Additions purchased 0 5,851 2 0 2,677 0 1,038 56 9,624 Additions donated 0 183 0 0 367 0 335 54 939 Reclassifications 0 2,096 0 (2,798) 367 0 0 0 (335)Reclassifications as ‘held for sale’ 0 0 (2) 0 0 0 0 0 (2)Disposals other than by sale 0 (2) 0 0 (3,315) 0 (1,347) 0 (4,664)Revaluation gains 0 519 22 0 0 0 0 0 541 Impairments 0 (982) 0 0 0 0 0 0 (982)At 31 March 2013 16,691 122,974 995 2,460 70,498 373 34,583 6,033 254,607 Depreciation At 1 April 2012 48,803 316 20,969 4,233 74,321 Disposals other than for sale 0 0 0 (3,303) 0 (1,346) 0 (4,649)Impairments 0 7,377 0 0 0 0 0 0 7,377 Reversal of impairments 0 (157) 0 0 0 0 0 0 (157)Charged during the year 0 4,427 56 3,997 23 3,087 373 11,963 At 31 March 2013 0 11,647 56 0 49,497 339 22,710 4,606 88,855 Net book value at 31 March 2013 16,691 111,327 939 2,460 21,001 34 11,873 1,427 165,752 Purchased 16,691 100,768 931 2,460 20,110 34 11,529 1,375 153,898 Donated 0 6,485 8 0 891 0 344 52 7,780 Government Granted 0 4,074 0 0 0 0 0 0 4,074 Total at 31 March 2013 16,691 111,327 939 2,460 21,001 34 11,873 1,427 165,752 Asset financing: Owned 16,441 110,277 939 2,460 21,001 34 11,873 1,427 164,452 On-SOFP PFI contracts 250 1,050 0 0 0 0 0 0 1,300 Total at 31 March 2013 16,691 111,327 939 2,460 21,001 34 11,873 1,427 165,752


1014.3 Property, plant and equipment (continued) Land and property assets are carried at valuation on the Statement of Financial Position. All of the Trust’s land, building and dwelling assets have been revalued as at 31 March 2014 by the District Valuers of the Valuation Office Agency. The valuations have been carried out in accordance with the Royal Institute of Chartered Surveyors (RICS) Appraisal and Valuation Manual insofar as these terms are consistent with the agreed requirements of the Department of Health and HM Treasury. The Trust’s plant and machinery assets (with individual values in excess of £15,000) were last revalued at 1 April 2009, by the Valuation Office Agency. Since that date these assets have been carried on the Statement of Financial Position at those valuations less subsequent depreciation. Plant and machinery assets not valued as part of this revaluation continue to be carried at depreciated historical cost as a proxy for fair value. During the year the Trust commissioned a revaluation of its tangible information technology assets. The valuation was undertaken by the Valuation Office Agency as at 31 December 2013. Prior to 31 December 2013, these assets were carried on the Statement of Financial Position on a depreciated historic cost basis. The valuation at 31 December 2013 was undertaken on a market value basis. The value of the assets prior to the revaluation was £9.297m and post valuation was £2.911m. The resultant impairment was charged to the Statement of Comprehensive income (£6.175m) and the Revaluation Reserve (£0.211m). Information technology assets purchased since 31 December 2013 are carried on the SOFP at depreciated historic cost. Other than the change in valuation basis for tangible information technology assets, the valuation methods used by the Trust used have not changed from those of the previous year.

Property, plant and equipment is depreciated at rates calculated to write them down to estimated residual values on a straight-line basis over their estimated useful lives. No depreciation is provided on freehold land and assets held for sale. Current asset lives are as follows: Minimum Maximum life (years) life (years)Buildings, excluding dwellings 0 50 Dwellings 0 23 Plant and machinery 0 35 Transport equipment 0 6 Information technology 0 7 Furniture and fittings 0 23

Note: assets with a nil net book value are recorded as having a life of zero years. Building and dwelling asset lives were re-assessed by the District Valuer at 31 March 2013, with those lives being applied for the 2013-14 year. The lives determined by the 31 March 2014 valuation will be applied in 2014-15. Information technology assets lives were re-assessed by the Valuation Office Agency at 31 December 2013. Asset lives have not been re-assessed for any other categories of asset. No compensation from third parties has been received for assets impaired, lost or given up. The Trust has no temporarily idle assets. The gross carrying amount of fully depreciated assets still in use is £40.1m (2012-13: £44.6m) Donations towards property, plant and equipment expenditure in the year have been provided by the following organisations:

p Royal Cornwall Hospitals NHS Charitable Funds (see related party transactions note);

p Fresenius

p Kay Kendall Leukaemia Fund.



14.3 Property, plant and equipment (continued)The following amounts have been recorded in these accounts with property, plant and equipment in respect of assets leased to other organisations by the Trust, under operating lease arrangements: Land Buildings Total (excluding dwellings £000s £000s £000s

Gross carrying amount 2,481 11,594 14,075 Accumulated impairment loss (1,274) (1,173) (2,447) Depreciation charge for the period 0 (261) (261) Impairment losses recognised for the period 0 (99) (99) Impairment losses reversed for the period 0 725 725

15.1 Intangible non-current assets: 2013-14 Computer Development Total Licenses Expenditure- Internally Generated £000s £000s £000sCost or valuation: At 1 April 2013 12,461 3,008 15,469 Additions - purchased 2,018 0 2,018 Additions - donated 30 0 30 Reclassifications 306 0 306 At 31 March 2014 14,815 3,008 17,823 Amortisation At 1 April 2013 6,437 3,008 9,445 Reclassifications 160 0 160 Charged during the year 1,694 0 1,694 At 31 March 2014 8,291 3,008 11,299 Net book value at 31 March 2014 6,524 0 6,524 Asset Financing: Net book value at 31 March 2014 comprises: Purchased 6,463 0 6,463 Donated 61 0 61 Total at 31 March 2014 6,524 0 6,524 Revaluation reserve balance for intangible non-current assets At 1 April 2013 72 0 72 Movements: revaluations and disposals 0 0 0 At 31 March 2014 72 0 72


1015.2 Intangible non-current assets: 2012-13 Computer Development Total Licenses Expenditure- Internally Generated £000s £000s £000sCost or valuation: At 1 April 2012 10,898 3,008 13,906 Additions - purchased 2,141 0 2,141 Additions - donated 39 0 39 Reclassifications 335 0 335 Disposals other than by sale (952) 0 (952)At 31 March 2013 12,461 3,008 15,469 Amortisation At 1 April 2012 6,212 3,008 9,220 Disposals other than by sale (952) 0 (952)Charged during the year 1,177 0 1,177 At 31 March 2013 6,437 3,008 9,445 Net book value at 31 March 2013 6,024 0 6,024 Net book value at 31 March 2013 comprises: Purchased 5,982 0 5,982 Donated 42 0 42 Total at 31 March 2013 6,024 0 6,024

15.3 Intangible non-current assets Intangible assets comprise purchased computer software and licenses, which are carried at amortised historical cost, as a proxy for fair value, together with development expenditure which is carried at a nominal value.

Assets are capitalised and amortised over the useful lives on a straight-line basis. Useful lives are all finite and range from 0 to 5 years. The gross carrying amount of fully depreciated assets still in use is £3.6m (2012-13: £2.2m). 16. Analysis of impairments and reversals 2013-14 2012-13 Property, Property, plant and plant and equipment equipment £000s £000s Impairments and reversals taken to the Statement of Comprehensive Income (SOCI) Changes in market price 11,316 7,220 Total charged to Annually Managed Expenditure (AME) 11,316 7,220 Total Impairments of property, plant and equipment changed to SOCI 11,316 7,220

Memo: Total impairments charged to reserves 495 982 Impairments charged to SOCI in 2013-14 have arisen following the annual year end revaluation of the Trust’s property assets (£5,141,000) on a Modern Equivalent Asset basis, and the 31 December 2013 revaluation of the information technology assets (£6,175,000) on a market value basis (previously depreciated historic cost basis). Both revaluations were undertaken by the Valuation Office Agency.

Note: impairments charged to SOCI in 2012-13 included £45,000 in respect of IFRIC 12 assets.



17. Commitments

17.1 Capital commitmentsContracted capital commitments at 31 March not otherwise included in these financial statements: 31 March 31 March 2014 2013 £000s £000s Property, plant and equipment 3,174 6,036 Total 3,174 6,036 Projects with commitments in excess of £1,000,000 included above: Replacement linear accelerator - £1,969,000 The programme for the replacement linear accelerator began just prior to the 31 March 2014 with the removal from site of the old machine and a room refurbishment to accommodate the new machine. The arrival of the new Truebeam linear accelerator is scheduled for late April 2014 and, following an extensive commissioning period, it is expected to be fully operational in August 2014. The total project cost is £2,341,000, with £372,000 having been spent in 2013-14.

18. Intra-Government and other balances Current Non-current Current Non-current receivables receivables payables payables £000s £000s £000s £000sBalances with: Other Central Government Bodies 8,314 0 9,372 0 Local Authorities 44 0 30 0 NHS bodies outside the Departmental Group 1 0 7 0 NHS Trusts and Foundation Trusts 1,139 2 842 0 Public Corporations and Trading Funds 15 0 0 0 Bodies external to government 8,046 1,072 22,673 4,107 At 31 March 2014 17,559 1,074 32,924 4,107 2012-13 Balances with: Other Central Government Bodies 4,547 0 6,619 0 Local Authorities 92 0 63 0 NHS bodies outside the Departmental Group 58 0 0 0 NHS Trusts and Foundation Trusts 805 3 573 0 Bodies external to government 6,549 1,311 19,510 4,870 At 31 March 2013 12,051 1,314 26,765 4,870


1019. Inventories Drugs Consumables Energy Total £000s £000s £000s £000sBalance at 1 April 2013 1,544 5,142 59 6,745 Additions 33,694 35,136 7 68,837 Inventories recognised as an expense in the period (33,488) (34,813) (14) (68,315)Write-down of inventories (including losses) (47) (18) 0 (65)Balance at 31 March 2014 1,703 5,447 52 7,202 No inventory balances above are held at net realisable value. 20.1 Trade and other receivables Current Non-current 31 March 31 March 31 March 31 March 2014 2013 2014 2013 £000s £000s £000s £000sNHS receivables - revenue 2,436 2,176 0 0 NHS prepayments and accrued income 6,611 3,023 2 3 Non-NHS receivables - revenue 3,999 2,702 0 0 Non-NHS prepayments and accrued income 2,739 2,557 349 176 Provision for the impairment of receivables (1,014) (1,012) 0 0 VAT 249 211 0 0 Other receivables 2,539 2,394 723 1,135 Total 17,559 12,051 1,074 1,314 Total receivables (current and non current ) 18,633 13,365 There are no prepaid pension contributions included within NHS receivables. The great majority of trade is with clinical commissioning groups. As clinical commissioning groups are funded by Government to buy NHS patient care services, no credit scoring of them is considered necessary. 20.2 Receivables past their due date but not impaired 31 March 31 March 2014 2013 £000s £000sBy up to three months 2,810 1,568 By three to six months 652 387 By more than six months 2,380 2,179 Total 5,842 4,134 20.3 Provision for impairment of receivables 2013-14 2012-13 £000s £000sBalance at 1 April 2013 (1,012) (1,333)Amount written off during the year 56 400 Amount recovered during the year 1 0 (Increase)/decrease in receivables impaired (59) (79)Balance at 31 March 2014 (1,014) (1,012) Department of Health guidelines require injury cost recovery receivables to be impaired at 15.8% (2012-13: 12.6%). However the Trust has taken to decision to provide for older balances at a higher rate.



20.3 Provision for impairment of receivables (continued)bles are impaired on the basis of their age and type, as follows: 31 March 31 March 2014 2013Balances older than 12 months 50% 50%Balances less than 12 months old 0% - 25% 5% - 25% Specific debts which are known to be doubtful have been provided for. 21. Cash and cash equivalents 31 March 31 March 2014 2013 £000s £000sOpening balance 11,628 6,729 Net change in year 199 4,899 Closing balance 11,827 11,628 Made up of Cash with Government Banking Service 11,662 11,406 Commercial banks 151 208 Cash in hand 14 14 Cash and cash equivalents as in statement of financial position 11,827 11,628 Bank overdraft - Government Banking Service 0 0 Bank overdraft - Commercial banks (46) (28)Cash and cash equivalents as in statement of cash flows 11,781 11,600 Patients’ money held by the Trust, not included above 0 0

22. Non-current assets held for sale The Trust has not held any non-current assets for sale during 2013-14. 2012-13: Land Dwellings Total £000s £000s £000sBalance at 1 April 2012 40 75 115 Plus assets classified as held for sale in the year 0 2 2 Less assets sold in the year (40) (77) (117)Balance at 31 March 2013 0 0 0 Liabilities associated with assets held for sale at 31 March 2013 0 0 0


1023. Trade and other payables Current Non-current 31 March 31 March 31 March 31 March 2014 2013 2014 2013 £000s £000s £000s £000sNHS payables - revenue 1,214 510 0 0 NHS accruals and deferred income 2,211 70 0 0 Non-NHS payables - revenue 6,107 4,237 0 0 Non-NHS payables - capital 3,479 3,351 0 0 Non-NHS accruals and deferred income 12,538 11,744 4,107 4,870 Social security costs 1,910 1,868 Tax 2,100 2,181 Other 3,365 2,804 0 0 Total 32,924 26,765 4,107 4,870 Total payables (current and non-current) 37,031 31,635 31 March 2014 31 March 2013 Included above: £000s £000s - outstanding pension contributions at the year end 2,781 2,563

There are no amounts included above to buy out early retirement liabilities. 24. Borrowings Current Non-current 31 March 31 March 31 March 31 March 2014 2013 2014 2013 £000s £000s £000s £000sBank overdraft - commercial banks 46 28 Loans from Department of Health 2,202 2,202 22,010 22,712 LIFT liabilities: Main liability 8 7 1,558 1,566 Total 2,256 2,237 23,568 24,278 Total other liabilities (current and non-current) 25,824 26,515 Loans and other borrowings - repayment of principal falling due in: 31 March 2014 31 March 2013 DH Other Total Total £000s £000s £000s £000s0-1 years 2,202 54 2,256 2,237 1 - 2 years 18,679 10 18,689 20,150 2 - 5 years 2,216 45 2,261 1,753 Over 5 years 1,115 1,503 2,618 2,375 Total 24,212 1,612 25,824 26,515



24. Borrowings (continued)

Loans from Department of Health 31 March 2014 31 March 2013 Value Value Interest rate outstanding Interest rate outstanding % £000s % £000sWorking capital/revenue support loan (1) 5.32 19,570 5.32 21,200 Working capital/revenue support loan (2) 0.58 1,571 0.58 1,857 Capital investment loan (3) 0.58 1,571 0.58 1,857 Capital investment loan (4) 1.99 1,500

(1) This loan was issued to the Trust by the Secretary of State for Health for, £46,125,000, in July 2008. The loan is for a 7 year period with repayments being made at six monthly intervals. The first instalment was repaid in September 2008. Officially this loan is due for repayment in full in 2014-15. However, the Trust has received an extension from the Department of Health (DH), via an agreement to repay a lower amount of £1,630,000 per annum. The Trust expects the loan to be officially rescheduled when it attains Foundation Trust (FT) status. IAS 1 requires management to assess, as part of the accounts preparation process, the Trust’s ability to continue as a going concern. In the context of non-trading entities in the public sector the anticipated continuation of the provision of a service in the future is normally sufficient evidence of going concern. The financial statements should be prepared on a going concern basis unless there are plans for, or no realistic alternative other than, the dissolution of the Trust without the transfer of its services to another entity within the public sector.

In preparing the financial statements the directors have considered the Trust’s overall financial position and expectation of future financial support. Current liabilities includes £1.63m in relation to the expected repayment of the historic loan which totals £19.57m as at 31 March 2014. The repayment due within one year has been notified to the Trust by the DH. However, the notification from the DH also states that this current liability is dependent on the Trust achieving FT status in 2014-15.

The formal terms of the loan require the loan to be repaid in full by 15 March 2015. The Trust has not been notified as to whether the full balance due will be repayable by 31 March 2015 should FT status not be achieved, although the deviation from the agreed schedule of repayments, plus discussions with the DH through completion of the Trust’s medium term financial plans, lead the Trust to believe that the Trust would not be expected to repay the additional £17.94m (the balance at 31 March 2014 less the scheduled repayments) during 2014-15, although this remains a possibility.

In the event of a full repayment being due, the Trust would need to review its cash position to determine whether a revenue support loan was required, effectively enacting a short term rescheduling of the historic debt. A full cash management plan would also be prepared at that stage. The Trust has also confirmed with the NHS Trust Development Authority that, should the exceptional circumstance occur and the DH re-open loan discussions, then sufficient cash financing will be made available to the Trust over the next twelve month period such that the organisation is able to meet its current liabilities. The Trust’s Prudential Borrowing Limit has sufficient headroom for this borrowing to occur if needed.

In respect of the overall going concern of the Trust, a full repayment of the loan would not impact on the Trust’s overall net asset position. Consequently, the Directors consider that there is sufficient evidence that the services this Trust provides will continue as a going concern in its current form for the foreseeable future. (2) A working capital/revenue support loan of £2,000,000, repayable within 7 years and 1 month, was issued to the Trust by the Secretary of State for Health in August 2012. Repayments commenced in March 2013.

(3) A capital investment loan of £2,000,000, repayable within 7 years and 1 month, was issued to the Trust by the Secretary of State for Health in August 2012. Repayments commenced in March 2013.

(4) A capital investment loan of £5,000,000, repayable within 10 years, was issued to the Trust by the Secretary of State for Health in March 2014. An initial £1,500,000 of this loan was drawn down in March 2014. No repayments are due in respect of this loan until the full £5,000,000 has been drawn down by the Trust. The Trust expects to draw down the remaining £3,500,000 during 2014-15 and commence repayment of the loan in September 2015.


1025. Deferred revenue Current Non-current 31 March 31 March 31 March 31 March 2014 2013 2014 2013 £000s £000s £000s £000sOpening balance at 1 April 2013 1,872 1,789 4,870 5,633 Deferred revenue additions 3,864 4,999 0 0 Transfer of deferred revenue (1,119) (4,916) (763) (763)Current deferred revenue at 31 March 2014 4,617 1,872 4,107 4,870 Total deferred revenue (current and non-current) 8,724 6,742 26. Provisions Early Legal Other Total Departure Costs Claims £000s £000s £000s £000sBalance at 1 April 2013 909 73 3,489 4,471 Arising during the year 49 71 164 284 Utilised during the year (77) (35) (241) (353)Unwinding of discount 20 3 75 98 Change in discount rate 36 0 174 210 Balance at 31 March 2014 937 112 3,661 4,710 Expected timing of cash flows: No later than one year 77 112 241 430 Later than one year and not later than five years 295 0 922 1,217 Later than five years 565 0 2,498 3,063 937 112 3,661 4,710 Amount included in the provisions of the NHS Litigation Authority in respect of clinical negligence liabilities: As at 31 March 2014 57,484 As at 31 March 2013 44,986 ‘Other’ provisions include £716,000 (2012-13: £703,000) in respect of pre 1995 pensions and £2,496,000 (2012-13: £2,786,000) in respect of permanent injury benefit provisions.

Pension provisions and pensions are calculated based on figures supplied by the NHS Business Services Authority - Pensions Division, using actuarial tables. As these tables cover significant time periods it is not possible to be precise about future amounts and timings of payment.

It is not possible to be precise regarding dates of settlement for industrial injury and other legal claims and therefore there is uncertainty over the calculation and timings of amounts due.

No reimbursements are expected in relation to the provisions disclosed above. 27. Contingencies 31 March 2014 31 March 2013 £000s £000sContingent liabilities Equal pay 0 0 Other 41 116 Amounts recoverable against contingent liabilities 0 0 Net value of contingent liabilities 41 116 The contingent liabilities above relate to personal injury claims made against the Trust, as advised by the NHS Litigation Authority.The Trust has no contingent assets.



28. LIFT - additional informationThe information below is required by the Department of Heath for inclusion in national statutory accounts. The Trust’s LIFT scheme relates to property used by the Cornwall Food Production Unit. Lease payments are made each month and updated for inflation on an annual basis. Under the terms of the lease, the Trust enjoys rights and obligations to the property until February 2033. The lease agreement includes the need for the landlord to insure and maintain the property. The Trust is required to meet the costs of utilities and these are payable to the landlord.

The Trust does have the option to purchase the premises, during and at the end of the term, and details are set out in the lease agreement. There are no other significant terms of the lease that may impact on the timing or certainty of cash flows. There have been no changes in the arrangement during the year. Charges to operating expenditure and future commitments in respect of on-SOFP LIFT 2013-14 2012-13 £000s £000sService element of on-SOFP LIFT charged to operating expenses in year 291 279 Total 291 279 Payments committed to in respect of off-SOFP LIFT and the service element of on-SOFP LIFT. 2013-14 2012-13LIFT Scheme expiry date: £000s £000s No later than one year 291 279 Later than one year, no later than five years 1,064 1,038 Later than five years 4,599 4,880 Total 5,954 6,197 Imputed “finance lease” obligations for on-SOFP LIFT contracts due 2013-14 2012-13 £000s £000sNo later than one year 336 336 Later than one year, no later than five years 1,345 1,345 Later than five years 4,678 5,015 Subtotal 6,359 6,696 Less: interest element (4,793) (5,123)Total 1,566 1,573 Present value imputed “finance lease” obligations for on-SOFP LIFT contracts due Analysed by when LIFT payments are due 2013-14 2012-13 £000s £000sNo later than one year 289 289 Later than one year, no later than five years 717 717 Later than five years 542 549 Total 1,548 1,555 Number of on-SOFP LIFT Contracts Total number of LIFT contracts 1 1 Number of LIFT contracts which individually have a total commitments value in excess of £500m 0 0


1029. Impact of IFRS treatmentThe information below is required by the Department of Heath for budget reconciliation purposes. 2013-14 2012-13 £000s £000sRevenue costs of IFRS: arrangements reported on SOFP under IFRIC12 (LIFT) Depreciation charges 53 55 Impairments charged to SOCI - AME 0 45 Net IFRS change (IFRIC12) 53 100

30. Financial instruments 30.1 Financial risk management Financial reporting standard IFRS 7 requires disclosure of the role that financial instruments have had during the period in creating or changing the risks a body faces in undertaking its activities. Because of the continuing service provider relationship that the NHS Trust has with clinical commissioning groups (CCGs) and the way those CCGs are financed, the NHS Trust is not exposed to the degree of financial risk faced by business entities. Also financial instruments play a much more limited role in creating or changing risk than would be typical of listed companies, to which the financial reporting standards mainly apply. The NHS Trust has limited powers to borrow or invest surplus funds and financial assets and liabilities are generated by day-to-day operational activities rather than being held to change the risks facing the NHS Trust in undertaking its activities. The Trust’s treasury management operations are carried out by the finance department, within

parameters defined formally within the Trust’s standing financial instructions and policies agreed by the board of directors. Trust treasury activity is subject to review by the Trust’s internal auditors. Currency risk The Trust is principally a domestic organisation with the great majority of transactions, assets and liabilities being in the UK and sterling based. The Trust has no overseas operations. The Trust therefore has low exposure to currency rate fluctuations. Interest rate risk The Trust borrows from government for capital expenditure, subject to affordability as confirmed by the strategic health authority. The borrowings are for 1 – 10 years, in line with the life of the associated assets, and interest is charged at the National Loans Fund rate, fixed for the life of the loan. The Trust therefore has low exposure to interest rate fluctuations. Credit risk Because the majority of the Trust’s revenue comes from contracts with other public sector bodies, the Trust has low exposure to credit risk. The maximum exposures as at 31 March 2014 are in receivables from customers, as disclosed in the trade and other receivables note. Liquidity risk The Trust’s operating costs are incurred under contracts with CCGs, which are financed from resources voted annually by Parliament. The Trust funds its capital expenditure from funds obtained within its prudential borrowing limit. The Trust is not, therefore, exposed to significant liquidity risks.



30.2 Financial assets 2013-14 Loans and receivables £000s Receivables - NHS 9,046 Receivables - non-NHS 7,679 Cash at bank and in hand 11,827 Total at 31 March 2014 28,552 2012-13 Loans and receivables £000s Receivables - NHS 5,202 Receivables - non-NHS 6,593 Cash at bank and in hand 11,628 Total at 31 March 2013 23,423 The Trust has no ‘available for sale’ financial assets or financial assets carried ‘at fair value through profit and loss’. 30.3 Financial liabilities 2013-14 Other £000s NHS payables 3,425 Non-NHS payables 29,511 Other borrowings 24,258 LIFT obligations 1,566 Total at 31 March 2014 58,760 2012-13 Other £000s NHS payables 580 Non-NHS payables 27,007 Other borrowings 24,942 LIFT obligations 1,573 Total at 31 March 2013 54,102 The Trust has no financial liabilities carried ‘at fair value through profit and loss’. 31. Events after the end of the reporting period There are no known post balance sheet events requiring disclosure. 32. Losses and special payments 2013-14 2012-13 Total Value Total Number Total Value Total Number of Cases (£) of Cases of Cases (£) of Cases Losses 121,662 199 477,641 302 Special payments 55,216 53 30,206 45 Total losses and special payments 176,878 252 507,847 347 There were no individual losses or special payments in excess of £250,000 in either 2013-14 or the preceding year.


1033. Related party transactionsDuring the year none of the Department of Health Ministers, Trust Board members or members of the key management staff, or parties related to any of them, has undertaken any material transactions with Royal Cornwall Hospitals NHS Trust, other than those transactions disclosed in this note. The Department of Health is regarded as a related party. During the year Royal Cornwall Hospitals NHS Trust has had material transactions with the Department in respect of the loans disclosed in Note 24. The Trust has also had material transactions with other entities for which the Department is regarded as the parent department. These entities and their associated transactions with the Trust are listed below: Year to 31 March 2014 Expenditure Revenue Payables Receivables with related with related with related with related party party party party £000 £000 £000 £000 Kernow Commissioning Group 25 226,801 2,565 4,354 NHS England* (areas teams) 3 63,620 0 2,778 Cornwall Partnership NHS FT 508 2,645 96 594 Royal Devon and Exeter Foundation Trust 296 1,707 202 39 NHS Litigation Authority 5,932 0 0 0 Year to 31 March 2013 Expenditure Revenue Payables Receivables with related with related with related with related party party party party £000 £000 £000 £000 NHS Cornwall and Isles of Scilly PCT 70 271,476 1 3,431 NHS South 0 12,265 0 0 Cornwall Partnership NHS FT 2,354 2,704 239 291 NHS Bristol 0 18,047 0 335 NHS Litigation Authority 6,486 0 1 0 *The Chief Executive Officer of Royal Cornwall Hospitals NHS Trust holds the position of National Clinical Director with NHS England. In addition, the Trust has had a number of material transactions with other Government Departments and other central and local Government bodies (see Note 18). Most of these transactions have been with NHS Pension Scheme, National Insurance Fund, NHS Blood and Transplant and HM Revenue and Customs.



33. Related party transactions (continued)

Royal Cornwall Hospitals NHS Charitable FundThe Royal Cornwall NHS Trust is the Corporate Trustee for the Royal Cornwall Hospitals NHS Trust Charitable Fund. The Trust has not consolidated the accounts of the Charitable Fund within these financial statements on the grounds that the transactions with the Charity and the Charity’s balances are not material to the Trust. However, summary financial data has been detailed below: Extracts from Charity Statement of Financial Activities 2013-14 2012-13 (draft) £000s £000sTotal incoming resources 749 1,244 Total resources expended with bodies outside of the NHS (352) (478)Total resources expended with Royal Cornwall Hospitals NHS Trust (348) (586)Total resources expended (700) (1,064) Net (outgoing)/incoming resources 49 180 Investment gains 80 132 Net movement in funds 129 312 Extracts from Charity Balance Sheet 2013-14 2012-13 (draft) £000s £000sInvestments 2,436 2,326 Total fixed assets 2,436 2,326 Cash 134 418 Other current assets 174 13 Current liabilities (60) (202) Net assets 2,684 2,555 Funds of the Charity Restricted funds 1,502 1,416 Non-restricted funds 1,182 1,139 2,684 2,555 Included within current liabilities at 31 March 2014 is £13,000 (2012-13: £104,070) owed to Royal Cornwall Hospitals NHS Trust


1034. Financial performance targets The figures given for periods prior to 2009-10 are on a UK GAAP basis as that is the basis on which the targets were set for those years. 34.1 Breakeven performance 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 £000s £000s £000s £000s £000s £000s £000s £000s £000sTurnover 238,999 234,384 259,418 282,726 303,925 310,471 314,246 323,341 332,819 Retained surplus/(deficit) for the year (15,687) (36,464) 1,285 2,009 (87) 442 618 2,925 (7,658)Adjustment for: Timing/non-cash impactingdistortions: 2007/08 PPA (relating to 1997/98 to 2006/07) (507) (151) Adjustments for Impairments 0 8,369 7,045 4,058 7,220 11,316 Adjustments for impact of policy change re donated/government grants assets (298) (391) 227 Consolidated Budgetary Guidance - Adjustment for dual accounting under IFRIC12* 67 57 59 55 53 Other agreed adjustments 1,932 0 0 0 0 0 0 0 0 Break-even in-year position (14,262) (36,615) 1,285 2,009 8,349 7,544 4,437 9,809 3,938 Break-even cumulative position (9,447) (46,062) (44,777) (42,768) (34,419) (26,875) (22,438) (12,629) (8,691) *Due to the introduction of International Financial Reporting Standards (IFRS) accounting in 2009-10, NHS trust’s financial performance measurement needs to be aligned with the guidance issued by HM Treasury measuring Departmental expenditure. Therefore, the incremental revenue expenditure resulting from the application of IFRS to IFRIC 12 schemes (which would include PFI schemes), which has no cash impact and is not chargeable for overall budgeting purposes, is excluded when measuring Breakeven performance. Other adjustments are made in respect of accounting policy changes (impairments and the removal of the donated asset and government grant reserves) to maintain comparability year to year. In 2008-09 the Trust agreed a recovery plan with NHS South to breakeven on a cumulative basis by 31 March 2013. This plan was linked to the repayment of the Trust’s historic debt and resulted in planned surplus levels to correspond with loan repayments. The Trust has revisit-ed its financial plans over the medium term to reflect updated financial planning assumptions and the expected re-scheduling of historic debt. If the Trust achieves annual surpluses of £3,900,000, the Trust will achieve breakeven on a cumulative basis by 31 March 2016. The medium term financial plan is submitted to the NHS Trust Development Authority (NTDA) on a periodic basis. 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14Materiality test (i.e. is it equal to or less than 0.5%): % % % % % % % % %Break-even in-year position as a percentage of turnover (5.97) (15.62) 0.50 0.71 2.75 2.43 1.41 3.03 1.18 Break-even cumulative position as a percentage of turnover (3.95) (19.65) (17.26) (15.13) (11.32) (8.66) (7.14) (3.91) (2.61) The amounts in the above tables in respect of financial years 2005/06 to 2008/09 inclusive have not been restated to IFRS and remain on a UK GAAP basis.



34.2 Capital cost absorption rateThe dividend payable on public dividend capital is based on the actual (rather than forecast) average relevant net assets and therefore the actual capital cost absorption rate is automatically 3.5%.

34.3 External financing limit (EFL) The Trust is given an external financing limit which it is permitted to undershoot. 2013-14 2012-13 £000s £000s £000s EFL 762 (3,285) Cash flow financing 614 (5,609) Unwinding of discount adjustment 98 External financing requirement 712 (5,609) Underspend against EFL 50 2,324 34.4 Capital resource limit (CRL) The Trust is given a capital resource limit which it is not permitted to exceed. 2013-14 2012-13 £000s £000s Gross capital expenditure 17,153 15,076 Less: book value of assets disposed of (125) (132) Less: donations towards the acquisition of non-current assets (362) (977) Charge against CRL 16,666 13,967 CRL 16,960 14,318 Underspend against the CRL 294 351


Independent auditor’s report to the directors ff RoyalCornwall Hospitals NHS Trust

We have audited the financial statements of Royal Cornwall Hospitals NHS Trust for the year ended 31 March 2014 under the Audit Commission Act 1998. The financial statements comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Taxpayers’ Equity, the Statement Cash Flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and the accounting policies directed by the Secretary of State with the consent of the Treasury as relevant to the National Health Service in England.

We have also audited the information in the Remuneration Report that is subject to audit, being:

p the table of salaries and allowances of senior managers (and related narrative notes) on page 96; p the table of pension and benefits of senior managers (and related narrative notes) on page 97; and p the table of pay multiples (and related narrative notes) on page 96.

This report is made solely to the Board of Directors of Royal Cornwall Hospitals NHS Trust in accordance with Part II of the Audit Commission Act 1998 and for no other purpose, as set out in paragraph 44 of the Statement of Responsibilities of Auditors and Audited Bodies published by the Audit Commission in March 2014. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Trust’s Directors and the Trust as a body, for our audit work, for this report, or for opinions we have formed.

Respective responsibilities of Directors and auditorsAs explained more fully in the Statement of Directors’ Responsibilities in respect of the accounts, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit

and express an opinion on the financial statements in accordance with applicable law and the International Standards on Auditing (UK and Ireland). Those standards also require us to comply with the auditing Practices Board’s Ethical Standards for Auditors.

Scope of the audit of the financial statementsAn audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Trust’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Trust; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the annual report which comprises: the Trust Profile, the Chairman’s Statement, Directors’ Report, Strategic Review; Our People – patients, staff and partners; the organisational structure; Remuneration Report and Annual Accounts, to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statementsIn our opinion the financial statements:

p give a true and fair view of the financial position of Royal Cornwall Hospitals NHS Trust as at 31 March 2014 and of its expenditure and income for the year then ended; and p have been prepared properly in accordance with the accounting policies directed by the Secretary of State with the consent of the Treasury as relevant to the National Health Service in England.

Opinion on other mattersIn our opinion:

p the part of the Remuneration Report subject to audit has been prepared properly in accordance

10



with the requirements directed by the Secretary of State with the consent of the Treasury as relevant to the National Health Service in England; and

p the information given in the annual report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we report by exceptionWe report to you if:

p in our opinion the governance statement does not reflect compliance with the Trust Development Authority’s Guidance

p we refer the matter to the Secretary of State under Section 19 of the Audit Commission Act 1988 because we have reason to believe that the Trust, or an officer of the Trust, is about to make, or has made, a decision involving unlawful expenditure, or is about to take, or has taken, unlawful action likely to cause a loss or deficiency; or

p we issue a report in the public interest under Section 8 of the Audit Commission Act 1998.

We have nothing to report in these respects.

Conclusion on the Trust’s arrangements for securing economy, efficiency and effectiveness in the use of resources

Respective responsibilities of the Trust and auditorsThe Trust is responsible for putting in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources, to ensure proper stewardship and governance, and to review regularly the adequacy and effectiveness of these arrangements.

We are required under Section 5 of the Audit Commission Act 1988 to satisfy ourselves that the Trust has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources. The Code of Audit Practice issued by the Audit Commission requires us to report to you our conclusion relating to proper arrangements, having regard to relevant criteria specified by the Audit Commission.

We report if significant matters have come to

our attention which prevent us from concluding that the Trust has put in place proper arrangements for securing economy, efficiency and effectiveness in its use of resources. We are not required to consider, nor have we considered, whether all aspects of the Trust’s arrangements for securing economy, efficiency and effectiveness in its use of resources are operating effectively.

Scope of the review of arrangements for securing economy, efficiency and effectiveness in the use of resourcesWe have undertaken our audit in accordance with the Code of Audit Practice, having regard to the guidance on the specified criteria, published by the Audit Commission in October 2013, as to whether the Trust has proper arrangements for:

p securing financial resilience

p challenging how it secures economy, efficiency and effectiveness.

The Audit Commission has determined these two criteria as those necessary for us to consider under the Code of Audit Practice in satisfying ourselves whether the Trust put in place proper arrangements for securing economy, efficiency and effectiveness in its use of resources for the year ended 31 March 2014.

We planned our work in accordance with the Code of Audit Practice. Based on our risk assessment, we undertook such work as we considered necessary to form a view on whether, in all significant respects, the Trust had put in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources.

ConclusionOn the basis of our work, having regard to the guidance on the specified criteria published by the Audit Commission in October 2013, we are satisfied that in all significant respects Royal Cornwall Hospitals NHS Trust put in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources for the year ending 31 March 2014.

CertificateWe cannot formally conclude the audit and issue an audit certificate until we have completed the work necessary to provide assurance over the Trust’s annual


10quality account. We are satisfied that this work does not have a material effect on the financial statements or on our value for money conclusion.

Barrie Morrisfor and on behalf of Grant Thornton UK LLP, appointed auditor

Hartwell House55-61 Victoria StreetBRISTOLBS1 6FT

3 June 2014.


Annual Governance Statement 2013/2014

(A) Scope of ResponsibilityThe Board is accountable for internal control. As Accountable Officer, and Chief Executive of this Board, I have responsibility for maintaining a sound system of internal control that supports the achievement of the organisation’s policies, aims and objectives. I also have responsibility for safeguarding the public funds and the organisation’s assets for which I am personally responsible as set out in the Accountable Officer Memorandum.The Trust’s Risk Management Strategy states that the Chief Executive is ultimately responsible for effective risk management within the Trust. At an operational level, this task has been delegated to the Nurse Executive. Day to day responsibility for risk management has been delegated to senior managers throughout the Trust.

Delivery of these responsibilities is scrutinised by the Trust’s executive and non-executive directors, through meetings of the Trust Board, Governance and Audit Committees. This scrutiny role is supported by the Board’s sub-committees and working groups. Minutes and reports from these committees are reviewed in Board meetings, which are held in public. The work of the committees and the decisions of the Trust Board provide evidence of the ongoing efforts to ensure that the overall governance, risk management and clinical governance systems are operating as they are supposed to.

The Trust is part of a local and national health economy. Accountability extends not only to Government, but also to partner organisations and to patients and service users. In recognition, the Trust’s planning and key objectives reflect the strong focus that is now placed on improved and expanded integrated and partnership working.

The Trust is accountable to the Trust Development Authority (TDA) for performance and control issues. They hold separate monthly meetings for chief executives, chief operating officers and finance directors where generic and community wide issues of control are discussed and actions agreed.

In addition, the Trust has regular meetings with senior officers, patients and other interested parties across the local health community, including:

p monthly reporting to the Trust Development Authority (TDA) on performance and governance issues and regular meetings at regional and national level;

p monthly performance meetings with NHS Kernow (Cornwall Clinical Commissioning Group - KCCG) and the Devon and Cornwall Area Team (AT);

p joint meetings with other Health Service Providers (including Cornwall Council, Cornwall Partnership Foundation Trust and Peninsula Community Health) ;

p regular meetings with service users’ representative groups, including Local HealthWatch, Patient Ambassadors and numerous patient groups throughout the Trust; and

p regular attendance at the Health and Social Care Scrutiny Committee meetings.

(B) The Governance Framework of the Organisation The Trust Board is engaged in reviewing internal control and risk management arrangements. This is achieved through the maintenance and review of the Board Assurance Framework (BAF) and the consideration of matters brought to its attention at sub committees of the Board. Additionally, significant internal control issues continue to be reported to me immediately and to the Trust Management Committee and Audit Committee and Trust Board at the earliest opportunity.

The Board has also adopted the principles set out in the NHS Foundation Trust Code of Governance and will formally assess compliance with the Code before it becomes a Foundation Trust.

The Trust’s committee structure and coverage of each Committee is included in each Committee’s Terms of Reference as approved by the Board. Critical responsibilities relating to governance are set out below:

The Audit Committee is responsible for considering the systems and standards of internal



control within the Trust, including control of securing economy, efficiency and effectiveness. The Committee’s focus has included:

p independently and objectively monitoring, reviewing and reporting to the Trust Board on the processes of internal control across the whole of the organisation’s activities (both clinical and non-clinical); p the operation of the Board’s assurance framework for the management of its principal risks; and the structures, processes and responsibilities for identifying and the managing key risks facing the Trust; p reviewing and approving all risk and control related disclosure statements, in particular the Annual Governance Statement (AGS) and the Head of Internal Audit Opinion, prior to endorsement by the Board; p considering the integrity, completeness and clarity of annual accounts and the risks and controls around its management; p reviewing the work of other committees whose work can provide relevant assurance; and p requesting and reviewing reports and positive assurances from Directors and Managers on the overall arrangements for internal controls.

One meeting of the Audit Committee was not quorate during the year; however any decisions were subsequently ratified at the next available meeting.

The Governance Committee is responsible for rigorously keeping under review all aspects of the Trust’s clinical and corporate governance. This includes, in particular, ensuring that the Trust meets all its duties and obligations under the NHS Constitution; plus all other statutory, regulatory and best practice requirements by which it is bound as a public body and for whose good implementation it is accountable to the people and community of Cornwall. It especially includes all aspects of the risk management process regarding clinical, quality and safety; and obtaining assurance on all aspects of the Trust’s declarations and its registration by the Care Quality Commission.

The Governance Committee’s focus has included:

p supporting the Audit Committee’s role on scrutinising the effectiveness of compliance mechanisms within the Trust; p overseeing the delivery of an integrated governance structure for the Trust; p assuring the Board on the implementation and effectiveness of governance and quality arrangements within the Trust; p confirming policies for ensuring that there is compliance with relevant regulatory, legal and code of conduct requirements and other relevant guidance; and p obtaining assurance on the Trust’s registration with the Care Quality Commission.

The Risk Management Committee is a sub-committee of the Governance Committee and its purpose is to direct the Trust’s management of all areas of risk and to ensure that all elements of the Risk Management Strategy are addressed within available resources. This includes management of risk in relation to the achievement of the Trust’s corporate objectives and the Board Assurance Framework. The Committee is chaired by the lead director for Clinical Risk (Nurse Executive) and its membership also comprises the Director of Finance, Performance and Information, Chief Operating Officer, the Company Secretary and other key senior managers.

The Remuneration Committee determines appropriate remuneration and terms of service for the Chief Executive, Executive Board Directors, very senior staff managers, and staff on local terms and conditions. The committee also, following advice from the Chief Executive, evaluates corporate and individual performance of executive directors and oversees appropriate contractual arrangements for such staff.

The Trust Management Committee (TMC) provides executive responsibility to ensure that the Trust’s services meet required performance, organisational and governance standards and to develop for

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Board approval the strategic plans of the Trust. The responsibilities of the TMC include strategy, quality and safety, performance, finance and workforce. This Committee has representation from each Division together with the Trust Executives and senior clinicians. The Committee is assisted on assurance matters by the Trust Management Committee – Governance (TMC-G) which ensures that operational governance processes are delivered effectively.

The Finance and Performance Committee conducts independent and objective reviews of the Trust’s financial and investment policy and associated investment proposals, Trust performance business risks material to the Trust’s objectives.

The Investment Committee reviews investment policy, capital investment strategy, financial aspects of significant contracts/business ventures and transactions, risk management in relation to such investments and post project evaluations.

The Finance and Performance Committee and the Investment Committee met separately during April to June 2013 and then stopped meeting. Finance issues which would have ordinarily been taken to the F&P Committee were reported to the Trust Board. These Committees were merged in February 2014 and named the Finance, Performance and Investment Committee.

During the year there were changes at Board level that meant that there was a period where the Board did not have its full complement of non-executive directors.

Apart from one Audit Committee meeting, all of the meetings held during the year have been quorate.

Shadow Council of Governors In March 2013, 21 shadow governors were elected and appointed as the Trust’s first Shadow Council of Governors as part of the Trust’s aim for NHS Foundation Trust status. The Shadow Council provides an important link between the Trust and the community that the Trust serves.

Board Assurance Framework and the Annual Governance Statement

The Board Assurance Framework is the key document for monitoring the effectiveness of the performance of the Trust in respect of governance issues and meeting its objectives. This has been developed through the evaluation of the six strategic and principal objectives for 2013/14. The Trust’s objectives were reconfigured as part of the development of the Integrated Business Plan which takes into account the Trust’s risk management agenda and brings together the strategic priorities and objectives of the organisation to assure the Board that any risks that may jeopardise the achievement of the objectives are identified and effectively managed.

The Board Assurance Framework is a key source of assurance when preparing the Annual Governance Statement, along with the Head of Internal Audit Opinion.

The Audit Committee plays a key role in providing the Board with the assurance it requires, with particular focus on the effectiveness of the Trust’s internal control system. The Audit Committee reports regularly to the Board.

(C) Risk AssessmentThe Trust recognises that one of the key success factors in achieving good governance is the effective management of risk. The Trust has robust processes in place to identify and manage its risk, so that the Trust is able to deliver strategic aims and objectives, and enable more meaningful engagement with patients, the public and the staff.

The Trust’s Risk Management Strategy and Policy (the Risk Management Strategy) was updated in November 2012 and the requirements for reporting risks, definitions of risks, as well as the reporting process and the lines of accountability have been incorporated into the Strategy. The Strategy highlights the reporting structure for individuals as well as committees. The Strategy describes the scoring system for assessing the severity of the risk facing the Trust and the mechanisms for ensuring that the Trust Board maintains its focus on mitigating the most critical risks.

The requirements for reporting risks, definitions of risks, as well as the reporting process and the lines of accountability have been incorporated



within the Risk Management Strategy. The Strategy is available to all staff through the Trust’s website in the documents library. The Strategy states that all staff are responsible for managing risks. All staff are provided with risk management training as part of their induction process. Additionally on-going mandatory training is required for all staff.The Trust’s Risk Management Strategy is reviewed and updated annually. The strategy:

p defines the Trust’s attitude to risk;

p defines unacceptable and acceptable risk;

p recognises the legal basis of requirements for risk assessment and risk management;

p describes the design of the Trust’s risk scoring approach;

p describes the function of the assurance framework and risk registers;

p identifies the roles and responsibilities, for risk management, of non-executive and executive directors, management and staff; and

p describes the structure of assurance, delivered through the working groups and committees of the Trust Board.

All staff are informed of the need to report incidents, via the Trust’s intranet incident reporting facility, and to disseminate experience and learn from incidents. The Trust has a policy for managing complaints, concerns, comments and compliments. The Trust also utilises improved incident reporting arrangements, including quarterly Complaints, Litigation, Incidents and PALS reports, which provide an analysis of incidents and identify action plans for addressing weaknesses identified. The reports are produced for each clinical division and for the Trust as a whole. These reports then link through and are integrated with the Trust’s Board Assurance Framework.

Trust Board Assurance Framework – High level risks and gaps in assurance and control

The Trust has developed a detailed process for monitoring the risks to achieving its objectives

and strategic aims, based on the Board Assurance Framework. This framework:

p identifies the Trust’s principal objectives, across all its main areas of activity and in accordance with the published Trust strategy;

p identifies the risks to the achievement of strategic objectives;

p identifies the components of the system of internal control in place to manage the risks;

p identifies the review and assurance sources which the Trust Board rely on relating to the effectiveness of such systems; and

p records the actions taken by the Trust Board to address identified gaps in control and assurance.

The Trust Board identifies risks to achieving its strategic aims, along with the key assurances that the Trust has around controls in place to ensure delivery of the aims and objectives.

It is the responsibility of the Company Secretary to ensure that the Board Assurance Framework is kept up to date and is used to influence the agenda for the Trust Board.

The Audit Committee is responsible for reviewing the processes in place for the development and monitoring of the Trust Board Assurance Framework and the Trust’s Management Committee is responsible for ensuring that there are appropriate links between the Board Assurance Framework and the Trust’s Risk Registers.

The Trust plans that systems of internal control are in place and work effectively throughout the whole year; however there are instances where controls are not fully effective and these may result in the Trust not being able to obtain the required level of assurance. The Trust sets out those gaps in control and assurance in this statement and confirms that action is being, or has been taken, to improve the control environment.

The highest rated risks as at 31 March 2014 that have been reported to the Board are shown in Appendix 1.The Board Assurance Framework is a live document and is regularly updated and changed. In 2014/15 the Board Assurance Framework will be updated as a matter of course to reflect the Trust’s revised business objectives.

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Risks in relation to data security

The Trust’s overall arrangements for managing data security lie within the responsibilities of the Director of Finance, Performance and Information, or nominated Executive Director in their absence. Where key data security risks arise, they are recorded on the Trust’s risk assurance register and addressed as part of the overall risk assurance management processes. The Trust’s annual self-assessment declaration, in the information governance toolkit, indicates that it maintains a high level of security over information and data security.

During the year three issues regarding data breaches were reported to the Information Commissioner. These were investigated with appropriate management action taken.The Trust has been assessed as compliant for the 2013/14 toolkit.

(D) The Risk and Control FrameworkThis section covers the risk and control framework and describes the system of internal control.

System of Internal Control

The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims and objectives. It can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to:

p identify and prioritise the risks to the achievement of the Trust’s policies, aims and objectives; and p evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically.

The system of internal control has been maintained in the Royal Cornwall Hospitals NHS Trust for the year ended 31 March 2014 and up to the date of approval of the annual report and accounts.

Risk Management Control Framework

Risks are identified across all functions of the

Trust’s activity, including clinical, support services,

corporate and administrative functions. Risks

are not limited to insurance and health and

safety issues, but include risks of non-delivery

of key targets and operational objectives. The

risk registers and assurance framework take

account of the Trust’s relationship with other NHS

organisations and with patients and the public.

The annual planning cycle, at all levels of the Trust,

includes the requirement for specialty, divisional

and departmental plans to identify and assess

the risks and assurances associated with each

of the key objectives identified. These risks and

assurances are required to be incorporated into the

relevant risk registers.

All risks that are identified are assessed, for

likelihood of occurrence and scale of impact should

the risk occur. The assessment process uses a

risk scoring system, which is defined in the Risk

Management Strategy. The Trust has also designed

a detailed five-point classification of the likelihood

and impact of a range of risk types, to help guide

managers in determining the consequence and

likelihood scores. Each risk that is recorded in

the risk register is assigned to a named individual.

Risks that are considered to be significant, but

which cannot be addressed at the level where they

are identified, are passed up to the next level of

management. The highest level risks, with the

most significant potential impact on the Trust, are

incorporated into the Board Assurance Framework.

The risk registers, including the Corporate

Risk Registers and Board Assurance Framework

identify the actions planned to address the risks

identified and an assessment of the likely residual

risk. Risks are monitored at Divisional governance

meetings. Specialty and departmental risk registers

are reviewed at group meetings. Locally, high

level risks are discussed with executive directors

at monthly meetings as part of regular assurance

framework review.



Head of Internal Audit Opinion – Risks and Gaps in Control

Internal Audit is a key source of assurance on the sound operation of the Trust’s internal controls.

The independent Head of Internal Audit’s opinion for 2013/14 provided significant assurance that a generally sound system of internal control was in place and that this was designed to meet the organisation’s objectives and the controls within it were generally being applied consistently.

Risks identified through working with external stakeholders

Externally the Trust works with a range of stakeholders to identify and manage risks. The Trust was performance managed by NHS Kernow in relation to contracts for services. This includes quality, operational performance including access, finance and human resources with a monthly performance review process at the Performance Management Group which for the majority of 2013/2014 also involves the Trust Development Authority (TDA), NHS Kernow and the Trust.

The detailed monitoring and analysis of the contract is undertaken by the Contract Management Group. These mechanisms are key to ensure contract performance and related risks are effectively managed by the performance process.

More widely, the Trust engaged with other stakeholders, including bodies nationally and locally such as the Strategic Clinical Network and partner providers and is a member of the Whole Systems Delivery Group (WSDG), which includes representatives from the key areas of the public sector in the county. This ensures the Trust keeps track of developing risks across the public sector and in the healthcare market.

RCHT works closely with commissioners and partners across health and social care through the commissioner led Quality, Innovation, Productivity and Prevention (QIPP) Programme to identify how services will develop and identify and manage risk from this process. Further, the Trust works closely with partners on operational risks and sustaining services through the Whole Systems Resilience

Network (WSRN).Any risks identified from working with external

stakeholders have been recorded on the Trust’s Risk Management System and escalated as appropriate for review by the Risk Committee.

Compliance with NHS Pension Scheme Regulations

As an employer with staff entitled to membership of the NHS Pension Scheme, control measures are in place to ensure all employer obligations contained within the Scheme Regulations are complied with. This includes ensuring that deductions from salary, employer’s contributions and payments in to the Scheme are in accordance with the Scheme Rules, and that Trust member Pension Scheme Records are accurately updated in accordance with the timescales detailed in the Regulations. The Trust is satisfied that pension deduction and calculations are made in accordance with regulations.

Compliance with equality, diversity and human rights legislation

Control measures are in place to ensure that all the Trust’s obligations under equality, diversity and human rights legislation are complied with.

Compliance with Climate Change Adaptation reporting to meet the requirements under the Climate Change Act 2008

The Trust continues to have a Carbon Reduction Delivery Plan in accordance with emergency preparedness and civil contingency requirements, as based on UKCIP 2009 weather projections, to ensure that this organisation’s obligations under the Climate Change Act and the Adaption Reporting requirements are complied with. Working towards a low carbon future is one of the Trust’s strategic objectives and a Sustainable Development Management Plan has been produced which will implement this objective. The Trust is developing a multi-million pound project (via the NHS Carbon & Energy Fund) which will seek to improve the Trust’s energy infrastructure and lead to significant reductions in CO2 emissions.

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Compliance with Care Quality Commission (CQC) – essential standards of quality and safety

The Trust is fully compliant with CQC essential standards of quality and safety and has maintained “Performing” status throughout 2013/14 in the DH Performance Framework.

The Care Quality Commission (CQC) carried out a full inspection of the RCHT in January 2014, being one of the first trusts to be inspected under the new CQC inspection regime which focuses on whether services were safe, effective, caring, responsive to peoples’ needs and well-led. The inspection covered eight service areas across the three RCHT sites.

The RCHT received the final copy of the inspection report on 21st March 2014. The CQC found that many of the services provided by the Trust were delivered to a good standard. The rating of ‘requires improvement’ recognises the RCHT being on an improvement path towards a “Good” rating.

The Trust has developed an improvement plan detailing the actions that will be taken to address the recommendations in the report. The two main actions relate to:

p Better management of patients’ records including their safe keeping, accuracy and completeness

p Improved planning and delivery of services, involving working with partners in the health and social care community to ensure that pressures and shortfalls in capacity are better managed.

Looking forward, the Trust plans to be in a position to request a re-inspection of its services in 6-9 months with the aim of being rated as ‘good’ and ‘outstanding’ in the future. However, the achievement of this is dependent on whole system change in health and social care in our area.

Quality Accounts

The Trust’s External Auditors will review the 2013/14 Quality Accounts and these will be presented to the Trust Board prior to final publication. This is consistent with the 2012/13 approach.

Counter Fraud

As part of the Trust’s approach to deterring fraud, the Trust uses the services of a Local Counter Fraud Specialist (LCFS). The LCFS produces a work plan each year which is agreed by the Audit Committee and allows for work on fraud detection, prevention and deterrence to be undertaken. An annual report on Counter Fraud activity is provided to the Trust through the Audit Committee.

(E) Review of the Effectiveness of Risk Management and Internal ControlAs Accountable Officer, I have responsibility for reviewing the effectiveness of the system of internal control. My review is informed in a number of ways. The Head of Internal Audit provides me with an opinion on the overall arrangements for gaining assurance through the Assurance Framework and on the controls reviewed as part of the internal audit work. Executive managers within the organisation who have responsibility for the development and maintenance of the system of internal control provide me with assurance. The integrated performance report to the Trust Board that measures the Trust performance against quality and safety, finance, local and national targets and the workforce provides me with assurance.

The Board Assurance Framework itself provides me with evidence that the effectiveness of controls that manage the risks to the organisation achieving its principal objectives have been reviewed. My review is also informed by:

p consideration of conclusions formed by the Care Quality Commission during the year on the Trust’s status; p consideration of the actions taken to address the issues highlighted in the previous Annual Governance Statement. p I have been advised for my review of the effectiveness of the system of internal control by the Board, Audit Committee, Governance Committee, Remuneration Committee and Executive Management Board. A plan to address weaknesses and ensure continuous improvement of the system is in place. In 2013/14 the Trust’s External Auditors did not raise any specific concerns in relation to internal control arrangements.



(F) Significant IssuesA single definition of a “significant internal control issue” is not possible. NHS organisations need to exercise judgement in deciding whether or not a particular issue should be regarded as falling into this category. This section sets out the significant control issues that have arisen during 2013/14.

Significant control issues identified through the work of Internal Audit

The Head of Internal Audit opinion for 2013/14 has been received. This states that significant assurance can be given that there is a sound system of internal control which is designed to meet the organisation’s objectives and that controls are being consistently applied in all the areas reviewed. No significant control issues were identified during 2013/14.

Significant control issues identified through the work of external auditors and regulators

No significant control issues have been brought to the attention of the Trust by its external auditors or other regulators.

Serious Incidents

There have been a number of incidents during 2013/14 which have been evaluated through the Trust’s formal processes and which do not present any areas for major concern.

The Trust has had five Never Events since 1st April 2013. In response to these the Trust has undertaken a programme of reviewing and strengthening the safety of patients undergoing invasive clinical procedures.

During the year the Trust experienced an unexpected increase in the levels of patients affected by the bacterial infection Clostridium Difficile (C.diff). Actions taken to improve the Trust’s position included an external peer review of infection control policies procedures and practices together with a review of communication of the Trust’s antimicrobial prescribing policies. Other actions include a range of teaching programmes on infection prevention and control and the Trust

leading on a county wide anti-microbial stewardship group.

The Trust was found to have failed its obligations under the Fire Safety Order, whereby there was non-compliance in parts of buildings with regard to fire safety regulations. A comprehensive safety improvement action plan was put in place to ensure that the Trust became compliant.

There have been historic failings in health and safety management leading to Health and Safety Executive (HSE) interventions over a number of years, culminating in an HSE investigation into the Trust’s cases of work-related dermatitis contracted by staff in the past. A full review of health and safety compliance has been commissioned to provide assurance of compliance with the Health and Safety Act 1974. A comprehensive action plan has been put in place and implementation has been progressed following this review.

Conclusion I am satisfied that appropriate systems of internal control are in place as at 31 March 2014 and up to the date of the approval of the annual report and accounts.

I believe the Trust has made good progress in improving the internal control environment and action plans are in place to ensure that any weaknesses identified are being addressed. A considerable amount of challenge and review, both governance and finance related, has been made as part of the Trust’s journey towards becoming a Foundation Trust and through the production of the Trust’s Integrated Business Plan. This process has further assured me that the systems of internal control are sound and fit for purpose.

Lezli Boswell, Chief Executive 2 June 2014Royal Cornwall Hospitals NHS Trust

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Summary of Risks included in Board Assurance Framework (Score 15+) APPENDIX 1Extract from Board Assurance and Risk Framework February 2014

Risk Ref Exec Potential Risk Potential Current Resid Adequacy Owner threat to Score Score of actions / objectives (L*C) (L*C) Assurance

3684, 3690 Director of The significant level of uncertainty of current and project 2.1, 2..2 20 20 F,P & I Strategy demand for acute services in relation emergency admission Committee 3687 Director of Increase in Competition from new and existing providers 2.1 20 15 Trust Board Strategy

3411 / 4509 / COO Clinical and operational capacity pressures : risk to 20 16 F,P & I 4166/ 4527 quality of care, reputation and target performance Committee

4301/3394 MD & Nurse Delay in the recognition of the deteriorating patients 1.1, 1.2 20 10 Trust Board Executive resulting in patient harm of death

3699, 3093 DHR The absence of a comprehensive and co-ordinated approach 4.1, 4.2, 4.3 16 9 Governance to the management of workforce related issues will Committee impact detrimentally upon levels of staff engagement and the quality of service delivery.

2591, 2928, DF & Acting Insufficient capital to deliver Clinical Site Development Plan 1.1, 1.2 16 12 F,P & I2922 / 4742 Director of Committee Estates

4909/4918/ COO An Internal Investigation into Fire Safety Management 1.1, 1.2 15 5 Trust Board4919/4920 has highlighted a number of areas where the Trust is failing to meet its obligations under the Fire Safety Order: The Regulatory Reform (Fire) Order 2005. Issues grouped under policies, management, training, infrastructure, resources and equipment.

4782 COO A backlog of overdue follow up outpatients within Cardiology. 8 4 TMC

4650 COO An inability to maintain/delivery target performance as a 16 12 F,P & I result of an increase in emergency admissions and Committee winter pressures.

4479b MD& A failure to identify poor clinical practice in a timely fashion 1.1, 1.2, 1.3 15 9 Trust Board Nurse due to poor governance processes may result in potential Executive for severe patient harm, significant reputational damage leading to legal action and financial cost to RCHT.

4502 COO Ophthalmology including diabetic retinopathy 15 12 TMC screening, photography, glaucoma and general ophthalmology consultation.

4479a MD A failure to manage effectively the Trust’s 1.1, 1.2, 1.3 12 9 Trust Board response to the KR Jones issue

Note: L = Likelihood, C= Consequence. Risks above 15 are classed as Extreme risks



Royal Cornwall Hospitals NHS TrustRoyal Cornwall Hospital

TRUROTR1 3Lj

01872 250000

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NHS RCHT annual report 2014

Documents

Transcript of NHS RCHT annual report 2014