We welcome Monitor’s investigation into our financial plans and we will be collaborating closely with them as it progresses. We are very clear that our Continuity of Service Risk Rating is now 2, which reflects a riskier financial position than our previous rating of 3 (on a scale of 1 to 4). As part of the trust’s plan this year we have set a lower target of cost improvement, in recognition of the fact that this trust has already been achieving high levels of efficiency – in the top 10% of trusts nationally, according to NHS reference cost figures for 2014*.
Because we are, relatively speaking, a very efficient NHS provider we are further down the road in identifying additional opportunities for improving efficiency. We have therefore set ourselves a cost improvement programme target to deliver £5.1m of savings in the year ahead rather than the £11m that national targets would suggest. This is to enable us to develop longer term productivity plans to deliver further savings in the years that follow.
We recognise how hard our staff are working to meet the needs of a growing population, with more people living longer and with more complex needs; and over the last year we have had a productive discussions with our commissioners about the funding of our services in light of this.
We fully understand the need for Monitor to investigate whether our planning assumptions about cost improvement and efficiency are achievable. We are also pleased that they will be taking into account our existing levels of efficiency in assessing whether the funding of our services is commensurate with the levels of activity that we are delivering to meet the needs of the people we serve.
* Oxford Health with a reference cost index of 89 was ranked 16th most efficient NHS trust out of 244 in England in the 2014 NHS Reference Costs Index, and 11% more efficient than the average trust.