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CRN East Midlands Budget Planning: 2022/23

Contents

 

Background

In late December 2021, regional budgets for 2022/23 were confirmed by the NIHR CRN Coordinating Centre. The East Midlands CRN will receive £23,273,441. CRN East Midlands is thus able to confirm the approach to budget planning, along with budget allocations across Partner organisations.  

For the past five years, with the exception of 2021/22, an activity driven approach to regional budget planning has been used, with a range of retrospective data incorporated into the formula to consider aspects such as performance, efficiency, incentivisation and reward. Once partner level budgets are defined, there is then a focus on forward planning those budgets to support NIHR CRN portfolio research delivery.  Last year (2021/22), due to the covid-19 pandemic, a short survey was undertaken and it was decided that to encourage stability, reduce risk and retain focus on delivery activities, a rollover budget approach would be used, with additional focussed investment on Urgent Public Health (UPH studies) and RRG (Recovery, Resilience and Growth).  This was also in line with the national planning arrangements.  

As with any annual financial planning, it is important to ensure that local planning decisions support the network as a whole to deliver on CRN objectives and priorities in line with the Host and Partner contracts. Critical to this is the planning phase at individual partner level and the continuation of the effective working relationship between the CRN and partners. 

Previous discussions, both at Partnership Group and through Finance Forum meetings, have centred on the need for stability. Another key theme has been to reduce the element of competition between partners where possible, appreciating different partners operate in different environments, all making an effective contribution.  An important theme, both from the past few years and looking forward to the future, is the importance of collaboration. Throughout the pandemic there are multiple examples of closer working between different departments/units within larger organisations, between partner organisations, across different care settings and jointly with the CRN. This is an area of work we are keen to further foster, especially with the development of Integrated Care Systems (ICSs), Integrated Care Boards (ICBs) and Primary Care Networks (PCNs), where there is a clear emphasis on collaborative working.

2022-23 Budget planning options and decisions

With the above considerations in mind, a budget discussion took place with partners through the Finance Engagement Event, and then full discussion and options paper at the Partnership Group meeting. 

The current year (2021/22) has been financially challenging, not least due to a managing significant and unplanned increase of c.£3M in-year, making financial planning quite difficult. Appendix 1 details elements of the 2021/22 budget, which aided the discussion as to each of these aspects and the planning into the following financial year. Some of these elements are non-recurrent and thus will not continue into 2022/23, others will be incorporated into the budget. Additionally, there will be ring-fenced allocations and cost pressures on some of the funding for next year (see below).

The planning approach which was selected was for a stable/roll-over of Partner allocations from 2021/22, into 2022/23, to incorporate the cost pressure funding (see appendix 1, #3).  Any central uplift/reduction to be applied on a % of budget basis.  As it has been subsequently considered that a stable/roll-over of the regional budget will be provided to us from the national team, no further actions are required regarding a central uplift/reduction.

It should be advised that for budget planning purposes, Primary care will continue to be considered as a partner organisation, with further planning then the lead responsibility of the relevant RDM, Divisional Clinical Lead and Specialty Leads. 

Commitments on future income

In response to previous feedback, in 2021/22 the CRN opened the targeted funding call across more than one financial year. As such, there are commitments which have been made to partner trusts into 2022/23 which must be met by 2022/23 income. Currently this totals c.£650k, although is subject to some change, and a detailed review is currently underway. 

Additionally, in preparation for 2022/23 planning, we have also been advised that within the total envelope of funding there are some specific elements to be ring-fenced, these include:

  • A minimum investment of 2% of total funding to be ring-fenced and provided to fund investments which target research for underserved communities. For the East Midlands this will be a minimum of £461,939k.
  • Transformation funding (as per appendix 1, #4). This is £909,000 and will be used to grow and support the national, and thus local, Transformation of research program.

These elements, which total just over £2M will be met from the above total CRN allocation for 2022/23. 

Funding categorisation

Within the CRN budget, there are three broad cost categories, these are described in table 1 below.  As outlined above, the CRN has received a stable budget for 2022/23 and the intention is therefore to roll-over the funding allocations across each of the categories below, and then within the categories at each partner level.  However, some of the funding which was received in 2021/22 will not be rolled-over into 2022/23 as it was provided to the region as non-recurrent funding. As such, the CRN will not be in receipt of this and cannot pass this through to partners. We appreciate this presents cost pressures at partner level, and will work with partners to understand the impact of this, and discuss any potential mitigations.

Table 1: CRN Budget categorisation 

Budget element

Description

Fixed costs

Local Portfolio Management Systems (LPMS) cost, Hosts costs and National Specialty Leads (where hosted in the region), fixed by contractual arrangements. 

Central network managed

This includes a variety of centrally managed resources to deliver on contractual elements, including: Management & Leadership (including Clinical Leadership), Research Support Team (RST) (now Direct Delivery Team, DDT), Communications, Patient and Public Involvement and Engagement (PPIE), Workforce development, Study Support Service (SSS), Business Intelligence (BI) and Finance. Transformation of Research Funding is also included in this category, which equates to £909k for both financial years.

Partner income

CRN funding which is provided to partner/stakeholder organisations for the business of research delivery. This is provided to fund the NHS support costs of the delivery of NIHR portfolio studies. Included in this categorisation is funding of c.2% of total income which will fund investments which target research for underserved communities, as although it will be centrally managed, throughout the year it will be distributed to partner organisations.

As outlined above, the intention is to retain funding for each area, although noting there is a drop in overall funding due to an element of non-recurrent funding in 2021/22. As can be seen below, the primary funding reduction is in the centrally managed category.

Table 2: CRN budget breakdown across categories

 

2021/21 (forecast full year effect, as at M9)

2022/23 (planning at start of year)

Fixed costs

£535,983

£542,062

Centrally managed costs

£4,941,063

£4,657,565

Partner income

£18,052,525

£18,073,814

Total

£23,529,571

£23,273,441

Partner level budgets

With respect to the partner income, each year the CRN is committed to transparency in the approach to funding, and provides below the CRN partner level budget allocations. There are some smaller partner organisations, outside of the NHS, that are supported separately, as we grow research in partnership with them. Further planning is required prior to the confirmation of this funding, this is with respect to organisations such as Loros and  CityCare, and in sectors across Public Health and social care.  

Additionally, funding is not included below for HEI partners in the region, as these payments are dependent on Specialty and Clinical Divisional Lead roles, which vary over time, and where costs are agreed on a rolling basis. This funding is currently captured with the centrally managed costs, described above. 

Table 3: Partner organisation budgets for 2022/23

Organisation

Indicative 2022/23 Partner Budgets £

Chesterfield Royal Hospital NHS Foundation Trust

414,478.04

Derbyshire Community Health Services NHS Foundation Trust

30,924.24

Derbyshire Healthcare NHS Foundation Trust

310,138.90

East Midlands Ambulance Service

67,500.00

Kettering General Hospital NHS Foundation Trust

463,407.89

Leicestershire Partnership NHS Trust

460,451.02

Lincolnshire Community Health Services NHS Trust

10,631.94

Lincolnshire Partnership NHS Foundation Trust

386,184.73

Northampton General Hospitals NHS Trust

752,832.03

Northamptonshire Healthcare NHS Foundation Trust

257,887.16

Nottingham University Hospitals NHS Trust

3,640,611.23

Nottinghamshire Healthcare NHS Foundation Trust

633,621.32

Primary Care

1,470,810.75

Sherwood Forest Hospitals NHS Foundation Trust

755,435.10

United Lincolnshire Hospitals NHS Trust

1,012,220.34

University Hospitals of Derby and Burton NHS Foundation Trust

1,796,652.90

University Hospitals of Leicester NHS Trust

3,946,895.79

The budget approach described here has been previously discussed and agreed with CRN partners, this paper is provided to confirm the detail and to foster open communication.

Elizabeth Moss

CRN East Midlands Chief Operating Officer

January 2022

 

Appendix 1: Table detailing 2021/22 funding elements, for reference

#

Funding component

2021/22 Amount

2021/22 purpose and any insights into 2022/23

1

Core/Infrastructure budget

£21M (less £450k in 2, below)

This is the core allocation to the CRN East Midlands at the start of 2020/21. It is invested primarily across partner organisations focussed on research delivery of the CRN portfolio, and in centrally managed infrastructure/services, to include: Hosting, Edge, CRN Management Team, Workforce development & Training, RST, SSS, Comms & PPIE, Information/BI supporting services.

2

High priority funding

£450k

This funding was established as a regional initiative to ensure sufficient funding would be focussed to the continuing priority of Urgent Public Health (UPH) study delivery, and moving then to Recovery Resilience and Growth (RRG).

3

Cost pressure funding

£551k

Provided to acknowledge that LCRN budgets had not previously been varied to meet a range of ongoing cost pressures. 

4

Transformation funding

£909k

Nationally £12.5M was made available to support working into new settings across social care, LA and wider. 

5

DHSC Public Health funding

£66k

Funding for investment in two specific Public Health research posts.

6

“Targeted funding”

£740k

In 2021/22 this additional funding was provided to LCRNs to help organisations to continue with the UPH effort and to retain staff who had joined research temporarily. In response to this EM CRN established a targeted funding call focussed on resilience, restarting and growth.

7

Managed recovery funding

£253k

This was provided in-year only, with no expectation of continuation.

Total 2021/22 income: £23.5M

The CRN does receive and process additional income streams, notably Excess Treatment Costs (ETCs) and National Specialty Lead payments, where the lead is based in the East Midlands. However, as these are provided and then paid out on a pass-through basis from DHSC, to the CRN and onwards to relevant partners, they are not included in the above list.