1. Joint Finance Day Jenni Field Head of Finance Strategy

2. Education Training Tariff: Today and tomorrow Roles and responsibilities Key messages from the 2014/15 Collection Preparing for the 2015/16 collection Developing currencies for placements

3. Roles and responsibilities: Produce guidance and collection templates Manage cost collection Analyse and publish data from collection Manage feedback Provide a helpdesk function Cost collectionCurrency DesignTariff Development Produce guidance Calculate prices Analyse impact of proposals on providers Manage feedback

4. HEE - National Contribute to the annual guidance Liaison between local teams and Department of Health Regular meetings with Department of Health Education and Training workshops Query management HEE is also a user of the data

5. HEE - Local Each HEE region has a person leading on E&T Provide LDA notification to trusts – activity & £’s Transfer payments to trusts for E&T Receive quarterly reports from trusts to aid reconciliation Provide information to trusts on activity / numbers of students Trust visits made to ensure quality of placements

6. Key messages from the 14/15 full year submission

7. 100% return rate. All 230 NHS providers submitted their education and training costs within the agreed timescales. 84 providers resubmitted in the managed resubmission week following the initial 7 week submission period A reduction of 50% in the number of outstanding validations, resulting in a more consistent dataset than the previous year A difference of approx. £300m between costs and funding, supporting the proposed move to an integrated collection which will inform any potential requirement to re-base budgets (service to E&T or visa versa) Dashboards enable local and national comparison updated

8. Changes between years:

9. 14/15 costs v income

10. The difference between costs and income at NHS providers, by cluster

11. Distribution of MFF adjusted ECIs in 2013/14 and 2014/15

12. Unit costs per hour (high activity areas) non salaried

13. Average cost per FTE (high activity areas) non salaried

14. Unit costs per hour (high activity areas) salaried

15. Average cost per FTE (high activity areas) - Salaried

16. Calculating the costs of Education and Training: Preparation for 15/16 – national guidance

17. Integrated Collection Aim of integration is to improve confidence in data that may inform potential re-basing Currently working with colleagues in reference costs to address questions including –Responsibilities for the collection –Inconsistencies in scope / sign-off etc. –Publication of data –Governance –Helpdesk functions

18. Integrated Collection Reference cost collection E&T cost collection 2013/14 & 2014/15 Reference cost collection 2015/16 (2016/17?) Integrated reference Cost and E&T cost collection Integrated reference Cost and E&T cost collection Future

19. Timing and structure of the collection window  In response to feedback from NHS providers and other stakeholders, collection window for 2015/16 extended  The collection will end in mid-September, not mid-August, allowing 4 extra weeks for the collection.  Collection window will start in June, at same time as reference costs, so giving NHS Providers flexibility as to when they submit  There will be no formal resubmission window this year, so mid-September is the final opportunity to submit information  The DH will be sharing validation reports specific to individual trusts throughout the collection.  Where the DH have previously shared national level validations, these will not be shared, or where they are these will be based on 2014/15  In a change for 2015/16, the workbooks for E&T will include some trust specific validations, so that those responsible for submission get real time feedback and can consider these prior to upload

20.  The feedback received following the 2014-15 exercise have been used to inform changes to the 2015-16 exercise and aim to: o remove the ambiguities in the guidance to improve consistency in approach and understanding o minimise the burden on NHS providers of the collection o provide additional support and identify sources of information to support the collection process o improve the quality of the data being provided o highlight the importance to data quality of the data submission involving both the education and finance teams  The national guidance document supporting the integrated collection will be released to the NHS at the end of February and the templates shared in March  The reference costs team at the DH will manage the upcoming collection and queries should be directed via the reference costs mailbox

21. Summary of main changes Key areas of work being progressed for the Education Costing guidance are as follows: –Service training splits - increase information available to trusts around expected percentage of time spent in training –Scope of collection - provide further clarification on the definition of a placement –Consistency of cost components – why do the percentage of costs differ so significantly between trusts on overheads and staff teaching costs –Control data - increase awareness around the availability of useful sources of information to inform submission –Validations – a review of the usefulness of the validations and how these are shared with NHS providers

22. Issues The scope for E&T needs revising to match reference costs E&T collection takes place outside the financial system Trusts will need to balance to accounts Staff turnover Constantly reviewing guidance / templates to include new professions (i.e. physicians associates) Trusts will need to think about the approach they take, there is a methodology but this is not mandatory. Timetable for integration Audit of E&T – likely to be integrated with Reference Cost Audit Data quality Primary Care

23. Developing Currencies “Currencies are the unit of education and training activity for which a payment is made”. “Tariffs are the set prices paid for each currency”.

24. Current system

25. Currency Development (1)

26. Currency Development (2) The new currencies will be called Education Resource Groups (ERG’s) The principles were created using the 2013-14 data, these were tested using the data from the 2014-15 collection. A multi-professional group has been created to look over the development of currencies and provide reassurance to the trusts on this work. A wider consultation will take place in the Autumn.

27. Membership of the Currency Development Group Trusts representatives Representatives from professional groups The Department of Health Health Education England

28. Aims of the Currency Development Group Set out the approach for creating ERG’s Develop the principles for ERG design Receive and request data analysis from the central team Propose draft groupings based on the principles Advise on the wider consultation process and advise us on how to respond to feedback

29. Draft Principles for Currency Design

30. Outcomes of early discussions “to avoid perverse financial incentives” “commissioners and providers need to believe in the currencies” “the currencies need to support the wider workforce objectives” “as few as possible” minimum number that meets the objectives v. as accurate as possible to fairly reward trusts

31. How do trusts get involved… Help drive forward data quality in the costing exercise to inform future revisions Participate in the wider consultation

32. Key messages The big developments in recent months: Publication of 2016/17 tariff still awaited Cost collection – real improvements to data quality and generally better engagement at a local level Cost collection – a real positive that we are moving to an integrated collection as this will: Introduce a reconciliation total (through accounts) for education and training Identify any cross subsidisation between service and training Enable discussions around potential changes to budgets Minimise the burden on providers of having to undertake multiple submissions

33. CSR Outcome for HEE Flat Cash settlement Eventual loss of £1.2bn through non-medical (training and bursary moving to student loans) No planned changes for under-graduate medical and dental 25-30% reduction over CSR period for education support and running costs HEE will still responsible for supply and demand equilibrium