CRN North East and North Cumbria Finance Model 2020/21

Contents

Introduction

CRN NENC 2020 Vision Strategy includes one strategic theme specifically dedicated to “Financial Resources” (Ensuring the right resources are in the right place to allow clinical research studies to happen). The focus of the work was to ensure budgets were aligned based on performance, with greater transparency of use of the funding. The strategy reads:

We recognise the need to ensure the right resources are available to our Partner Organisations and other stakeholders to ensure the effective delivery of clinical research studies.

This means we need to ensure CRN income is optimised, by continuously reviewing and improving research delivery performance, and distributed to stakeholders in a fair and transparent way reflecting research delivery performance, continuous improvement targets and strategic need.

The first aim of the work plan developed from this is:

“To advise the Executive on principles for allocating Partner Organisation funding and the strategic budget using the most effective performance and quality measures.”

Process

The CRN NENC undergoes a 3 stage process to agree the Local Finance Model on an annual basis:

1. Outline Principles are discussed and agreed for further exploration at the CRN NENC Partnership Group Board in June
2. Refined final principles are discussed and agreed at the CRN NENC Partnership Group Board in September/ October
3. Once final budgets have been received by the national CRN CC Finance Team, final allocations as per the agreed principles are released to all Partner Organisations

 The detailed planning process as described in the Finance SOP for CRN NENC (v1.0) is described below:

Plan:

• Agree Principles of budget at first Partnership Group meeting of the financial year for both Partner Organisations and Central Network Budget
• Any principles to be further developed and processed through LCRN Executive
• Final Principles of Annual Financial Planning are agreed at second Partnership Group meeting for full budget
• LCRN Directorate Accountant generates a first draft finance model for planning based on allocation assumptions and principles

First stage:

• Partner Organisation Plans against full Annual Financial Planning guidance document and predicted first draft budget allocation
• Submitted plans undergo a first stage review against minimum controlled principles by the allocated Senior Management Team Link contact for their organisation
• LCRN Directorate Accountant and Chief Operating Officer accept or reject the first draft plan. Feedback is given in writing to all organisations.
• Rejected plans require re-submission within defined time period

Second stage:

• LCRN Directorate Accountant revises financial plan based on final allocation and approval to Partnership Group
• Revised plan issued to Partner Organisations for review and update, prior to final submission deadline
• LCRN Directorate Accountant and Chief Operating Officer accept or reject the final plan. Feedback is given in writing to all organisations.
• Rejected plans require re-submission within defined time period
• Final plans are uploaded to the CRN Finance Tool

Agreed Model for 2020-21

These include the following summarised sections:

1. Study Support Service

   In a change to last year’s model the overall budget of £313,000 from last year has been added to the “Baseline Allocation” and a proportion of this budget (no more than 10% at an Alliance Level (Appendix 1 lists the organisations in each Alliance)) now needs to be spent and annotated in the plan on “back office costs”.

2. Strategic Funding

   Strategic Funding should total 3% of the allocation and should include some monies in relation to the Quality Improvement Incentive Scheme (to be confirmed via Executive Group). This will not total more than 0.5%. Funding could run for longer than 12 months, having first "call" on the next year's Strategic Funding allocation.

3. Baseline Allocation & Performance Multiplier

   A new Performance Model was agreed for 2019-20 removing all historical calculations. A new baseline based on Complexity Adjusted Recruitment (CAR) activity over 2 years (2017-18 and 2018-19) was agreed to be applied to proportionally to the full baseline allocation (less centrally allocated sums). Up to 10% of this allocation maximum, across an alliance, can be utilised on “back office costs” and this needs to be clearly described in the agreed plan of spend. A budget has been created for both Primary Care and also Non-NHS Settings as a pseudo Partner Organisation. The same principles apply as all other Partner Organisations to these budgets.

4. Cap and Collar

   The purpose of employing a budget cap and collar is to prevent large year-on-year swings in PO budgets; substantial disinvestment is particularly concerning given the risk of losing experienced research staff. A +5% -5% cap and collar if required will be applied to the allocation for each organisation.

5. Host and Core Budget

   Combined Host & Core Budget allocation to be 15% of overall allocation.

6. Overhead

   Overhead to be maintained at 4%.

7. Programmed Activities

   PA allocations to each Specialty Group will be calculated on CAR for 24 months (2017/18 and 2018/19 as above) plus complexity adjusted studies (CAS) for the same time period, as used last year: (percentage contribution to CAR over 24 months + percentage contribution to CAS)/2. As with previous years, Diabetes and Endocrine allocations have been joined, Health Services Research has been removed. Primary Care has a separate allocation for leadership and Green shoots within their budget. Total allocation is subject to a 10% reduction in funding equalling £1,291,485. Each award is not more than £4,500 per annum. Of this budget 15% (£198,000) has been awarded to Green shoots. This budget is used to fund Clinical time, green shoots and Nursing, Midwifery and Allied Health Professionals (NMAHP) time within agreed guidelines.

8. Leadership Awards

   As required by the Performance and Operating Framework contract Leadership awards are given for all Specialty Group Leads and Executive members. These amount to a value of £10,000 per Programmed Activity (PA) (i.e. 0.5 day per week per annum). Specialty Group Leads and Executive members are awarded 0.5 PA.
   The Clinical Director is awarded 4 PAs and the Deputy Clinical Director is awarded 2 PAs.
   Further Leadership roles are remunerated at no more than 0.5 PA.

Appendix 1 - Partner Organisation Alliances