2020-2021 Income vs Expenditure and the Balance Sheet - PowerPoint Presentation

1. 2020-2021 Income vs Expenditure and the Balance SheetAn interim financial regime in 20-21 supported management of the pandemic and allowed the Trust to balance income with expenditure for the first time in several years.2020/212019/20DifferenceLast yearThe year before   Income472.6393.720%   Pay costs(298.0)(271.9)10%Other costs(174.3)(144.3)21%Expenditure(472.3)(416.2)14%Deficit0.3(22.5)We received 20% more in funding than in the previous year while costs were 14% higher. This allowed the Trust to materially break-even.The Trust received £32m to cover costs related to the pandemic.2020/212019/20DifferenceLast yearThe year beforeAssets/ Liabilities   Fixed assets244.2201.421%Current assets63.846.138%Liabilities(71.8)(291.6)-75%Net liabilities236.2(44.1)    Financed by:   Equity and reserves567.6282.9101%Net I&E reserve(331.4)(327.0)1%Total equity236.2(44.1)A much healthier balance sheet driven by significant capital investment, write off of loans and increased revenue. During the year £237m of loans were replaced with equity (Public Dividend Capital). .

2. IncomeThe interim financial regime allowed the Trust to receive 20% more income than 2019/20.The Trust’s ability to treat as many patients as possible was limited by the pandemic but the regime supported the Trust being able to manage the uncertainty without having to borrow. Income related to non patient care services such as car parking, property leases, retail, reduced significantly as expected. Modest levels of private patient income reduced further.The Trust accounts for donated assets as income. 2020/21 2019/20 Difference Last year (m) The year before (m) NHS Fixed and COVID funds426.1 NA NHS incomeNA 343.4 High cost drugs income10.8 11.2 Private patient income0.6 0.9 Additional pension income10.0 9.6 Education and training11.9 10.4  Non patient care services and other income10.3 18.0  Donated asset income2.9 0.2  Total income472.6 393.7  20%

3. Revenue expenditureTotal operating costs increased by 14% in 2020/21. Most of this cost increase was due to additional costs linked to the pandemic outstripping cost reductions elsewhere. Our agency staff costs reduced again to £12m despite These costs have reduced every year from their peak of £36m in 2015/16. Pay costs (excluding the pensions increase and agency costs) increased by 20% in line with the 20% growth in funding. Clinical negligence costs are an increasing concern rising by 34% linked payments for cases that occurred many years in the past.In 2020/21 NHSEI relaxed the normal requirement for savings required to operate successfully within funds available. However the Trust generated savings against many non pay spend areas worth £1.9m.  2020/21 2019/20 DifferenceOperating expensesLast year (m) The year before (m) Pay costs (exc pension increase and agency)297.9 248.7 20%Pension increase10.0 9.6 4%Agency staff costs12.0 13.6 -12%Clinical negligence costs21.9 16.4 34%Other costs129.9 125.3 4%      Total costs471.7 413.6 14%

4. Capital expenditure – new and improved assets and environmentAt last year’s AGM we reported investing £21.5m in improving our assets and environment in 2019/20 which was more than in any of the last 5 years. For 2020/21 we invested £57.3m over twice the amount spent in 2019/20.Notably we made significant progress in most notably constructing our multi-storey car park, developing plans for our new hospital, implementing a new electronic patent record system, supporting ED with a new emergency assessment unit and starting refurbishment of the WGH theatres.In 2020/21 we hope to increase the investment again to over £80m while still breaking even on the revenue account. Spending will include:Completing the multi-storey car parkCompleting the OBC for the Trust’s redevelopment.Implementing the EPRFurther improvements to ED.Capital expenditure2020/21 2019/20 Last year (m) Last year (m)Multi-storey car park14.6 0.0IT investments6.6 5.0Fire safety improvements3.3 3.5Winter preparedness for emergency services2.6 3.0Medical equipment7.6 3.0Estate backlog maintenance4.2 1.5Watford GH operating theatres project2.0 1.1Redevelopment plans5.4 0.0Other11.0 4.4Total57.3 21.5