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1 1 NHS Highland Board 25 July 2017 Item GOVERNANCE COMMITTEE ANNUAL REPORTS Report by Ruth Daly, Board Secretary on behalf of Elaine Mead, Chief Executive The Board is asked to: Note the views of the Audit Committee on the Annual Reports of the Governance Committees. 1. Summary and Background As part of the Annual Accounts process a number of Annual Reports relating to NHS Highland Committees are produced, including a specific declaration that the systems of control within their respective areas are considered to be operating adequately and effectively. These Annual Reports form part of the framework of assurance supporting the Statement of Internal Control which is part of the Annual Accounts process. At their meetings held on 9 May and 27 June 2017, the Audit Committee considered and noted the following Annual Reports: Appendix 1 Staff Governance Committee Appendix 2 Remuneration Sub-Committee Appendix 3 Clinical Governance Committee Appendix 4 Audit Committee Appendix 5 Highland Health and Social Care Committee Appendix 6 Asset Management Group Appendix 7 Control of Infection Committee Appendix 8 Health & Safety Committee Appendix 9 Pharmacy Practices Committee 2. Contribution to Board Objectives The above reports form a key part of the statutory requirement for NHS Highland to submit an Internal Statement of Control which is included in the Boards Annual Accounts. 3. Governance Implications The production of these Annual reports forms part of the assurance framework for the Board regarding the way in which its Committees discharge their delegated responsibilities. This encompasses all areas of Governance including: Staff Governance; Patient and Public Involvement; Clinical Governance; and Financial Governance. 4. Planning for Fairness This paper describes the annual reporting process and therefore does not require an equality impact assessment. It is however recommended that Committees of the Board are aware of and understand their responsibilities in terms of challenging inequality and promoting equality and diversity and how this can be embedded within governance and decision making processes. 5. Engagement and Communication These reports have already been approved by their Committees in at least draft format. They will public documents both as part of the Board papers and as part of the Annual Accounts process. Ruth Daly Board Secretary July 2017

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3 3 Appendix 1 NHS Highland Staff Governance Annual Report To: From: NHS Highland Audit Committee Alasdair Lawton, Chair, Staff Governance Committee Subject: Staff Governance Committee Report April 2016 March Background In line with sound governance principles, an Annual Report is submitted from the Staff Governance Committee to the Audit Committee. This is undertaken to cover the complete financial year, and allows the Audit Committee to provide the Board of NHS Highland with the assurance it needs to approve the Governance Statement, which forms part of the Annual Accounts. 2 Activity (April 2016 March 2017) The Staff Governance Committee meets 4 times per year, in the reporting period the Committee met on 17 th May 2016, 23 rd August 2016, 15 th November 2016 and 14 th February The minutes from each meeting have been submitted to the appropriate Board meeting. Membership for changed in September 2016 with 2 of the non executive members Members: In Attendance: Mr Alasdair Lawton- Chair, Non-Executive Director Mr Robin Creelman, Non-Executive Director Mr Adam Palmer (Employee Director), Non-Executive Director Elaine Wilkinson/Sarah Wedgewood, Non Executive Director Myra Duncan/John McAlpine, Non Executive Director Anne Gent, Director of HR ( Executive Lead) Etta MacKay, Staffside Representative ( Unison) Margaret McCrae, Staffside Representative (RCN) Bernice Nott, Staffside Representative (GMB) Attendance 2016/17 Name May 16 Aug 16 Nov 16 Feb 17 A Lawton Y Y Y Y R Creelman Y N N Y A Palmer Y Y Y Y E Wilkinson Y Y n/a n/a M Duncan Y Y n/a n/a S Wedgwood n/a n/a Y n/a J McAlpine n/a n/a N N A Gent Y Y Y Y E Mackay N N N N M McCrae Y Y Y Y

4 4 Bernice Nott N N N N This year the areas of focus for the Committee have been Statutory and Mandatory Training, the Highland Quality Approach, Everyone Matters 2020 workforce vision, workforce planning and workforce issues. Within these areas specific key topics were Band 1 review, staff experience and i-matter, Everyone Matters action plan and the knowledge and skills framework. 3 Sub Groups The Remuneration Committee is one of the formal sub groups of the Staff Governance Committee. Minutes from this sub group are submitted to the Committee. It also produces its own Annual Report. The Highland Partnership Forum (HPF) acts as the operational group of the Staff Governance Committee and considers the majority of agenda items prior to submission to the Committee. Reporting to HPF are further 3 sub groups: HR, Terms & Conditions and Learning & Development. Human Resources Sub Group Co-chaired by Deputy Director of HR and the Employee Director this sub group meets monthly but alternating between a formal meeting and working group in order to progress its work. The group s remit is to consider new HR policies, the implementation of NHS Scotland PIN policies and review existing policies. In the reporting period the key focus has been on reviewing and implementing the suite of policies for supporting the work life balance, reviewing whistleblowing arrangements and the capability policy and process. Terms and Conditions Sub Group Also co-chaired by the Deputy Director of HR and the Employee Director this sub group meets bi-monthly and has representation from management, payroll, HR and staffside. The remit of this group is to consider interpretation of national terms and conditions and NHS Highland s approach to the implementation of National Terms and Conditions Circulars. As with the HR Sub group the minutes are submitted to the HPF. The key focus areas in the reporting period have been on Paid as if at work and the transfer of Highland Council staff to agenda for change in relation to terms and conditions. Learning and Development Sub Group Co-chaired by an Operational Manager and a Staff Side Representative and has representations from managers, clinicians, Learning and Development and staffside. The remit is to have an oversight of all L&D activity within NHS Highland; monitor and report on learning activity to enable compliance with the Appropriately Trained component of the Staff Governance standard; monitoring of the L&D budget; support monitor KSF and PDP&R and ensures that L&D activity supports and is aligned to NHS Highlands Corporate Objectives. During the key focus areas were: Statutory and Mandatory Training, the creation and review of the annual Learning Plan; the implementation of Educational Governance, PDP&R process; support for the Learning Partnership agreement; and allocating and monitoring the usage of the L&D budget.

5 5 4 External Reviews The Staff Governance Standard National Annual Monitoring Return was submitted to the Scottish Government in October Several pulse surveys have also been undertaken to understand staff experience and respond to feedback. The Board also participated in the Stonewall survey to understand its approach to LBGT and those with protected characteristics in the workforce and those who use services. In August 2016 the HPF met with Maureen Watt, Minister for Mental Health as part of the Board s Annual Review; topics covered included sickness absence, workforce planning, i-matter, organisational change and the functioning of the HPF. 5 Any relevant Key Performance Indicators Knowledge and Skills Framework Although this is no longer a HEAT target NHS Highland has made a commitment to the development of staff and has set a local annual target for all AfC staff to be reviewed with at least 80% of development reviews carried out and recorded electronically. The percentage figure of reviews which were completed and signed off for non bank staff at the end of the reporting period (1 st April 16 to 31 st March 17) was 35.54%. Work has been undertaken to identify the issues pertaining to the downward trend. Training and support continues for managers and staff. The Oracle Performance Management (OPM) system, the electronic system developed to replace e-ksf was scheduled to be introduced from April In preparation for this Boards were requested to consider undertaking a rationalisation of the KSF Post Outlines in use in each Board. Within NHS Highland this process was applied to the >5500 KSF post outlines in use. A suite of revised post outlines was developed and agreed resulting in the creation of post outlines containing just the six core dimensions. This has enabled the eksf process to be simplified and further improvement work is underway. Opportunities have been taken to link the details of actions created in imatter Action Plans to individuals PDP s. A range of Education Frameworks have been developed following consultation with service managers and team/professional leads. The frameworks describe the Statutory/Mandatory and Core education and development required for the each role and it is intended that managers and reviewers will use the frameworks as part of the PDP&R process to identify, discuss and confirm that staff are aware of and have either undertaken or plan to undertake the training required for their post. i-matter Implementation/Activity i-matter implementation is progressing well and inclusive of health and social care staff in North Highland and Argyll and Bute Integrated Joint Board. In 2016/17 NHS Highland s Response Rate was 63% and Employee Engagement Index was 74. The Board will meet national i-matter implementation timescales in that its entire workforce will be surveyed at least once by the end of 2017.

6 6 Sickness Absence In 2008 NHS Boards were asked to reduce sickness absence to 4% and NHS Highland has continued to work towards this standard with monthly reports prepared for managers and quarterly reports for the Staff Governance Committee. Continuous monitoring of sickness absence is in place and regular support, advice and training from the Personnel Team is available to managers to ensure the consistent application of NHS Highland s Promoting Attendance Policy. Long Term sickness continues to account for the largest proportion of sickness and a focus is maintained on supporting rehabilitation and phased return to work initiatives. We await the nationally revised Promoting Attendance which is due for release this year. Workforce Planning & Development The Staff Governance Committee receives quarterly updates of progress being made against the actions published in the annual Workforce Plan, via a Workforce Plan Rolling Action Plan which is underpinned by the Everyone Matters Action plan. In addition, specific workforce plans have also been developed to support major service redesign that will take place in 2017/18: a Workforce Plan developed to support Badenoch and Strathspey Service Redesign. Band 1 Review As requested by Scottish Government a review was undertaken by NHS Highland of all band 1 employees. At the commencement of the review NHS Highland employed approximately 940 band 1 employees. To date 928 staff have been offered a band 2 role. So far 555 have accepted the offer. Work will continue to eliminate all band 1 posts within the Board. As a result of the review NHS Highland were able to reduce the number of job descriptions held for these posts, from 144 to 33. The review will be concluded by May Emerging issues and key issues to address/improve the following year In 2017/18 the key issues will be continuing to improve the completion of statutory and mandatory training; developing a workforce plan to support Skye, Lochalsh and West Ross; reducing sickness absence levels, continuing progressing i-matter and improving on response rates and the engagement index. The Board has also engaged in IHI Joy in Work prototyping and has plans to implement the learning in the Board in A successful aspect has been staff exposure to quality improvement in their service and this has led to engagement in change and empowerment to make the changes in their service their involvement and engagement has led to joy in work outputs streamlined processes, increased productivity, good engagement with i-matter and the development of team values. The Workforce Agenda continues to grow and a NHS Highland Workforce Work Programme has been developed to support the Highland Quality Approach and the implementation of Everyone Matters: 2020 Workforce Vision. This year will also see the transfer of Care at Home staff from Highland Council terms and conditions to Agenda for Change. This is scheduled for June 2017 and will result in 756 staff transferring.

7 7 7 Conclusion As the Chair of the Staff Governance Committee, I can confirm that the systems of control within the respective areas within the remit of the committee are considered to be operating adequately and effectively. Alasdair Lawton Chair - Staff Governance Committee April 2017

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9 9 Annual Reports NHS Highland Remuneration Sub Committee Annual Report: To: From: NHS Highland Audit Committee David Alston, Chair, Remuneration Sub Committee Subject: Remuneration Sub Committee Report April 16 March 17 1 Background In line with sound governance principles, an Annual Report is submitted from the Remuneration Sub Committee to the Staff Governance Committee and from the Staff Governance Committee to the Audit Committee. This is undertaken to cover the complete financial year, and forms part of the supporting arrangements for the Statement of Internal Control, ending with the certification and submission of the Annual Accounts. The Remuneration Committee is a formal Sub Committee of the Staff Governance Committee. The Role of the Remuneration Committee is: To agree all the terms and conditions of employment of executive directors of the Board and other members of the Senior Leadership Team including: - job descriptions - job evaluation - terms of employment - basic pay - performance related pay - benefits (e.g. Removal Expenses) - agreeing objectives for executives before the start of the year in which performance is assessed - reviewing performance mid year and at the end of the year - ensuring that effective arrangements are in place for carrying out the above two functions in respect of all other senior managers - conducting a regular review of the Board s policy for the remuneration and performance assessment of executive directors and other senior managers in the light of guidance issued by the SGHD. The Role and Remit of the Sub Committee was updated in November 2011 to include reference to Medical Consultants, in relation to regularly reviewing the Boards Policy for their Remuneration and Performance Assessment. The Remuneration Sub Committee has met on 3 occasions during the year on 17 th May, 4 th July and 22 nd November. Abridged minutes of the Remuneration Sub Committee have been submitted to the appropriate Staff Governance Committee Meeting. 1

10 10 2 Activity The Remuneration Sub Committee considered the following key items at its meetings throughout the year. 17 th May 2016 Pay and Conditions of Executive and Senior Manager Pay 2015 and 2016 Pay and Conditions of Service 2015/16 Health Board Medical Directors/Former Medical Directors on Protection Remuneration Sub Committee Annual Report 2015/16 Remuneration Sub Committee Revised Workplan 2015/16 Executive Cohort End of Year Reviews 4 th July 2016 Senior Manager Cohort End of Year Outcomes 2015/16 Executive Cohort Objectives 2016/17 22 nd November 2016 Update on Executive and Senior Management Pay Discretionary Points Advisory Committee (DPAC) Award of Discretionary Points for Consultants 1 April 2015 Executive Cohort Mid Year Reviews Post of Director of Operations Inner Moray Firth Membership from 1 April March 2017: Dr David Alston, Chair Ms Sarah Wedgwood, Vice-Chair (until October 2016) Mr Robin Creelman, Vice Chair, Argyll & Bute Integrated Joint Board Mrs Myra Duncan, Chair, Highland Health & Social Care Committee (until October 2016) Mr Alasdair Lawton, Chair of Staff Governance Committee Mr Adam Palmer, Employee Director In Attendance: Mrs Anne Gent, Director of Human Resources (Lead Executive) Ms Elaine Mead, Chief Executive 2

11 11 Attendance from 1 April March 2017: Member 17/05/16 04/07/16 22/11/16 David Alston Robin Creelman A A Myra Duncan N/A (until 27/9/16) Alasdair Lawton A A A Adam Palmer A A Sarah Wedgwood A N/A (until 27/9/16) Melanie Newdick N/A N/A (from 27/9/16) Anne Gent Elaine Mead 3 Sub Groups The Remuneration Sub Committee does not have any Sub Groups. 4 External Reviews The outcomes of the End of Year Reviews for the Executive Cohort were submitted to the National Performance Monitoring Committee and approved. The Remuneration Sub Committee has access to the National Remuneration Committee Self Assessment Pack to ensure that the performance of the Remuneration Sub Committee is in line with National Guidance. 5 Any relevant Key Performance Indicators There are no Key Performance Indicators for the Remuneration Sub Committee. Audits were progressed in year. No External 6 Emerging issues and key issues to address/improve the following year The Remuneration Sub Committee is well established with a clearly defined Role and Remit and Work Programme, in the main set by national requirements. Attendance at the Sub Committee has been satisfactory and Non-Executive Directors demonstrate the appropriate scrutiny required. 7 Conclusion David Alston, Chair, as Chair of the Remuneration Sub Committee has concluded that the systems of control within the respective areas within the remit of the Remuneration Sub Committee are considered to be operating adequately and effectively. David Alston Chair March

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13 13 NHS Highland Clinical Governance Annual Report Clinical Governance Committee 18 April 2017 To: From: NHS Highland Audit Committee Myra Duncan, Chair, Clinical Governance Committee Subject: Clinical Governance Committee Report April 2016-March Background In line with sound governance principles, an Annual Report is submitted from the Clinical Governance Committee to the Audit Committee. This is undertaken to cover the complete financial year, and allows the Audit Committee to provide the Board of NHS Highland with the assurance it needs to approve the Governance Statement, which forms part of the Annual Accounts. The committee met on five occasions during 2016/17 on 19 April, 28 June, 21 September and 6 December 2016 and 7 February Its minutes and assurance reports were submitted to NHS Highland Board at its public meetings during this period. The Clinical Governance Committee is attended by clinical representatives from each operational unit and from all professions. It also has Executive and Non-Executive Board Member representation and two lay members who ensure rigorous scrutiny of data and issues which are brought to its attention. Internal reporting systems are embedded in the organisation by which significant events, serious complaints and issues considered worthy to report on an exceptional basis are brought to the Committee. An atmosphere of open reporting and mutual trust and respect provides assurance to members that the right issues are being raised and shared with colleagues. The system ensures learning is taken and shared throughout the operational units through their respective Quality and Patient Safety Groups. This system is supported by a central Clinical Governance Team who collates the relevant data using Datix reporting system which enables correlations to be made on an organisational basis and therefore lends rigour to the assurance provided to the Clinical Governance Committee. The Committee has established a quality and safety dashboard which includes key issues such as numbers of falls, pressure ulcers, medication errors, and mortality data. This system can be interrogated at any point in the system and will provide the Committee with real-time data on important issues whilst giving the Committee a high level snapshot of performance and improvement. The Committee has started to use the dashboard to inform its Agenda. The NHS Highland Risk Management Policy has been embedded throughout the organisation, with local responsibility for identifying and managing risks being monitored through the unit Quality & Patient Safety Groups and issues escalated to the Clinical Governance Committee where appropriate. It is planned that the organisation s risk registers will be embedded on the Datix system by 31 March During the year governance arrangements for the children s health services which are delivered by The Highland Council on behalf of NHS Highland as part of the integration arrangements have been developed. The Committee has incorporated assurance reporting on these services into its work. The Committee has also considered patient safety and quality aspects of changes in the way care is delivered, eg Caithness Maternity Services and Out of Hours services, and expects

14 14 its governance role in the area of service change to become more proactive as the NHS Highland Clinical Strategy is implemented. 2 Activity April March 2017 The committee met on five occasions during 2016/17 on 19 April, 28 June, 21 September and 6 December 2016 and 7 February Its minutes and assurance reports were submitted to NHS Highland Board at its public meetings during this period. A list of members and their attendance at the committee meetings is shown in Appendix A. Significant Event Reviews During the past 12 months continuing support has been provided to the Operational Units in order to support the recording of all SERs within DATIX, ensuring that all actions are entered into the improvement / action planning module in DATIX to allow organisation and operational unit monitoring. Monthly reports on active SAERs and those awaiting ratification have been developed and are provided to the Operational Units and the Board Medical and Nursing Directors to assist with monitoring of investigations and the resulting actions / improvements. All operational units now have a ratification process in place through a Subgroup of their Quality and Patient Safety / Clinical Governance Groups. Training In 2016/17 monthly training has continued, available for all NHSH staff on the following: - Reporter training - Reviewer training including improvement / action planning. - SERs in DATIX including improvement / action planning. - Running pre-set reports and accessing DATIX Dashboards. - Searching and building reports in DATIX - Adverse Event Toolkit Awareness Sessions. The Clinical Governance Team have revised and built on their existing investigation support tools and there is now a full Adverse Event Toolkit available on the NHS Highland Intranet. efault.aspx Adverse Event Figures A total of 12,381 adverse events were reported in 2016/17. breakdown of the severity and operational unit. The following table gives a Argyll and Bute CHP North & West Highland Raigmore (IMFOU) South & Mid Highland (IMFOU) Highland Council - Children's Services Corporate Services Estates Pharmacy Total Negligible - no/minor injury or harm not requiring first aid, no impact/risk to service/standards of care

15 15 Minor - Injury/harm requiring first aid, minimal impact on service provision/standards of care Moderate - reportable, significant injury/harm req med advice/potential impact service/standards of care Major - major injuries/long term incapacity/disability, signifcant issues of standards/quality of care Extreme - death/major perm incapcity/long-term damage, serious adverse event, substandard care Not yet graded Total Complaints Management Performance against the 20 working day target has remained a challenge throughout the year with the average of 39% of complaints being responded to, within the 20 working day target each month. Numbers of formal complaints received have continued to increase with a 6.3% increase in the last financial year. Activity 2015/ /17 Total number of complaints received Total number of complaints investigated Number responded within 20 working days % Responded to within 20 working days 39% 39% A new NHS complaints handling procedure will come into effect from 1 April Clinical Effectiveness Activity The Clinical Effectiveness Team continues to support NHS Highland staff with a range of audit and evaluation project work that helps inform improvement within NHS Highland. Examples from 2016/17 include the following

16 16 To support medical revalidation, a large-scale programme of patient feedback is ongoing, based on the CARE questionnaire. Over 8,000 questionnaires have now been collated for doctors undergoing revalidation. Findings from the feedback are discussed in individual revalidation and appraisal meetings. Patient feedback documentation and methodology has recently been reviewed with the aim of simplifying the process for patients and administrative staff, and improving response rates. The team continues to research different approaches to gathering feedback for revalidation. Another aspect of ongoing medical revalidation support is the provision of incident, complaints and claims reports from DATIX for doctors annual appraisal and five-yearly revalidation meetings. The team has supported a public consultation exercise in North Highland on a new single health and social care hub facility care facility for the North Coast. As part of the consultation, the population living in North West Sutherland (aged 16 years or over) were surveyed on their opinions about the proposed changes and options. A report on the survey results was produced for the project steering group. The team is currently supporting a Transport and Access Needs Assessment which has been commissioned from Aberdeen University as part of the redesign of health and social care services on Skye. The CE team assisted in developing questionnaires for local transport operators on Skye, to gain information about what transport options are available to people who need to access the hospitals at Portree and Broadford Hospitals. Record Keeping audits continue to be supported on an annual basis by the CGST for nursing and allied health professionals. Completed audit tools are returned to the team for highland wide analysis. Audit profile/compliance reports were sent to assigned leads to use the information and disseminate as required The CGST have developed a Mortality Review Tool that will support Raigmore and Rural General Hospitals with a standardised approach to collecting and using mortality data. The results are used by project leaders to inform service improvement, eg: o AAC users survey: service user feedback was used to develop KPIs; a second patient survey is being run to explore patients views of the service and the impact of changes o Endoscopy Unit patient feedback results are used by the individual units to review the service provided and identify where improvements can be made o Fracture Clinic feedback was largely positive but some issues were identified eg difficulties in contacting the service. A second round of data collection is seeking patients views to assess ongoing levels of satisfaction with the service and the impact of changes Operational Unit Quality and Patient Safety Groups Each of the Operational Units has a well established Quality and Patient Safety Group which meet throughout the year. The Terms of Reference for the Groups and sub group have been reviewed to ensure standardisation across the operational units. Each group routinely reviews complaints, incidents, mortality and morbidity reviews, SPSP programme, risk registers and reports by exception to the Clinical Governance Committee through the Clinical Director. All operational units have established adverse event ratification groups to enhance the scrutiny of Significant Adverse Event Reviews. Committees Reporting to the Clinical Governance Committee All reporting committees are expected to submit annual reports and report by exception.

17 17 Emerging issues and key issues to address/improve the following year The committee will focus on the following areas next financial year Embedding the Clinical Governance Dashboard Learning and Improving Clinical Risk Management Ensuring safety in changes to services and new models of care New Duty of Candour Conclusion The Chair of the Clinical Governance Committee is confident, through the scrutiny of internal and external reports and minutes, systematic review of the reporting mechanism and regular presentations that the systems of internal control of the delivery of safe clinical care are adequate. However it will continue to focus on assuring that any identified weaknesses in the system are addressed and that a culture of continuous improvement in clinical governance is fostered across the Board area. Myra Duncan Chair Clinical Governance Committee April 2017

18 18 CLINICAL GOVERNANCE COMMITTEE ATTENDANCE TRACKER Myra Duncan n/a n/a n/a Apols Non-Executive Chair Sarah Wedgwood n/a Non-Executive Chair Valerie Barker (Public Member) Elspeth Caithness Apols (staff side rep) Graham Crerar n/a n/a n/a n/a Non-Exec Board Member Dr Paul Davidson n/a n/a Apols Clinical Director N&W Mike Evans Non-Exec Board Member Apols Apols Apols Dr Andrew Evennett Non-Exec Board Member Apols Dr Michael Foxley Apols Apols x Apols Non-Exec Board Member Dr Michael Hall Clinical Director A&B Dr Rod Harvey Apols Medical Director Dr Katherine Jones Clinical Director n/a n/a n/a n/a Dr Ken McDonald Apols Associate Medical Director Raigmore Dr Stewart MacPherson Apols Apols Clinical Director S&M Ms Heidi May Nurse Director Apols Mr Alex Murray (Public Member) Dr Gaener Rodger n/a n/a n/a Apols Non-Exec Board Member Mr Ian Rudd, x Director of Pharmacy Dr Ian Scott n/a n/a n/a Clinical Director S&M Catherine Stockoe x x x x x Infection Control Manager Dr Hugo Van Woerden Apols Apols Dir of PH and HP Claire Wood Associate Director AHP n/a Susan Russel (HC) Claire Wood (till April 16) n/a n/a n/a

19 19 AUDIT COMMITTEE ANNUAL REPORT PERIOD MAY 2016 MAY 2017 Report by Elaine Wilkinson, Chair, Audit Committee 1. Background In line with sound governance principles, an Annual Report is completed of the work of the Audit Committee. This is undertaken to cover the period up to May 2017, and allows the Audit Committee to provide the Board of NHS Highland with the assurance it needs to approve the Governance Statement, which forms part of the Annual Accounts. 2. Activity This report covers the period May 2016 to May 2017 during which time there were six meetings of the Audit Committee. The Audit Committee exists amongst other things to:- ensure that the activities of the Board are within the law and regulations governing the NHS verify that an effective and comprehensive system of Internal Control is implemented and maintained ensure audit is undertaken and consider the Annual Accounts The Audit Committee agrees the work-plan at the beginning of each financial year, operates with a formal agenda and written papers which are circulated in advance of the meeting. These circulated papers include written reports by both the Internal and the External Auditors. These reports detail the work undertaken, the key issues emerging and the steps being taken by management to address any weaknesses identified. The Audit Committee is chaired by myself as an independent non-executive, with four other non-executives as members. Although not Committee members, the meetings are usually attended by the Chief Operating Officer and the Director of Finance. All Board Members are able to attend as observers and Executives and other officers attend as appropriate to provide further detail and information and to answer specific questions from the Committee. Attendance at Meetings:- Member \ Meeting Date May16 Jun16 Sep16 Dec16 Mar17 May17 Mike Evans (Chair until Sep16) Y Y Y a a Resigned Adam Palmer (Chair Dec16) Y Y Y Y Y Y Myra Duncan(Chair from Mar17) N/A N/A N/A Y Y Y Ann Pascoe Y Y Y Y Y a Elaine Wilkinson N/A N/A N/A a Y Y Dr. Michael Foxley Y Y a N/A N/A N/A John McAlpine N/A N/A Resigned

20 20 In addition to considering the work of the Auditors, the Committee also maintains an overview of a number of Internal Control areas on behalf of the NHS Board. An example of this is the overview of Risk Management - which although devolved to Organisational Units is subject to overall Audit Committee Review. A separate section of the Audit Committee agenda is dedicated to Counter Fraud, allowing the Committee to discharge this responsibility on behalf of the Board 3. Year end Annual Accounts 2015/16 At the Audit Committee meeting in June 2016 to consider the Annual Accounts, assurances were received in support of the finalisation of the accounts in relation to :- a. the Internal Audit Annual Report for 2015/16 and b. External Systems national NHS Scotland Service Audit reports The draft accounts were presented by the Director of Finance and the external auditors reported on their findings and matters arising from their audit of these financial statements. The Audit Committee noted the unqualified audit opinion and the accounts were recommended for approval by the Board. 4. Internal Audit Service A major part of the work of the Audit Committee relates to Internal Audit, whereby the Committee consider and approve the Audit Plan before monitoring the delivery of this plan and consideration of the key points arising. During this period, the Audit Committee received a formal written summary on 22 Audit Reports, together with full copies of 12 reports which contained at least one Grade 4/5 equating to High/Very High Risk Exposure against a Control objective. The details of reports considered are in the Audit Committee Papers and the Audit Committee minutes which are subsequently presented to the full NHS Board. The internal auditors are responsible for monitoring the management action plan that is produced with each report and reporting progress in implementing the agreed recommendations back to the Audit Committee. 5. Sub Groups The Audit Committee does not operate with any formal sub groups. The Audit Chair meets with both sets of auditors in private session annually without any non-audit Committee members present. The Chair also has ongoing direct contact with the Internal Auditors between meetings and, as Fraud Champion for the Board, has maintained contact with the Board s Fraud Liaison Officer and the national Counter Fraud Services Team on a regular basis.

21 21 6. External Reviews The work of the Audit Committee is different from most other committees in that the work of the Committee is influenced and delivered by independent input through Internal and External Audit. This review is further enhanced by the Annual Internal Audit Statement of Assurance, and the review of Audit arrangements undertaken by the External Auditors as part of the verification of the Annual Accounts. As part of their work, the External auditor submits an update on work undertaken to each Audit Committee, summarising not only the work undertaken, but also highlighting to the Committee any areas of significant interest. In addition, as part of the review of the Board governance, it was agreed that it would not be appropriate to hold audit committees in public. 7. Issues to Address The Audit Committee will continue to review its responsibilities with other governance committees following the Governance Review being undertaken by the Board. Close links need to be maintained with the audit committee of the Argyll & Bute Integrated Joint Board as the IJB develops. 8. Conclusion Over this period, there have been a number of changes of members with a new chair of Audit formally appointed with effect from May Good progress throughout the year for the Audit Committee included recommending to the Board the unqualified accounts for 2015/16, increasing the emphasis on counter-fraud initiatives, integration of social care services within the NHS including the Integrated Joint Board in the Argyll & Bute area, systematic follow up of recommendations and spreading the scope of internal audit beyond traditional accounting issues. The Audit Committee has fully discharged it s duties to date and has therefore been able to contribute to the Board operating within the appropriate framework of Internal Control. The systems of control within the remit of the Committee are considered to be operating adequately and effectively. Elaine Wilkinson Chair of Audit Committee NHS Highland June 2017

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23 23 NHS Highland Health and Social Care Committee Annual Report Highland Health & Social Care Committee 4 May 2017 Item 6 To: From: NHS Highland Audit Committee Melanie Newdick, Chair of Health and Social Care Committee Subject: Committee Report 16/17 1 Background In line with sound governance principles, an Annual Report is submitted from the Health and Social Care Committee to the Audit Committee. This is undertaken to cover the complete financial year, and allows the Audit Committee to provide the Board of NHS Highland with the assurance it needs to approve the Governance Statement, which forms part of the Annual Accounts. 2 Activity 1 st April st April 2017 A summary of the key activities during the year and particular areas of scrutiny/progress you would like to highlight and if available a copy of the annual work plan for the committee. The number of meetings during the year, that the Minutes have been submitted to the Board along with reports relating to key items and a list of members and their attendance at meetings etc). In November 2017 we reformatted our terms of reference to align with the High 5 principles. We used this format for our agendas and meeting planners and adopted a year planner for our meetings (copy attached) At every meeting we have reviewed financial information, balanced scorecards, operational reports and Director of social work reports. We have reviewed reports on children s services. Other reports have included; Adult strategic commissioning intentions Charging for adult care Contract Monitoring Vanguard Theatre Utilisation We have provided feedback about the revised format of the adult wellbeing scorecard and the North of Scotland redesign. In March 2017 we held a development session with approximately one third (1/3 rd ) of the members of the committee. This included a self assessment of the performance of the committee and training on understanding financial information. 3 Sub Groups There have been no sub group meetings. 4 External Reviews No significant external reviews

24 24 5 Any relevant Key Performance Indicators We have not set any key performance indicators as we are awaiting the outcome of the board decision around the governance of the Health and Social Care Committee. 6 Emerging issues and key issues to address/improve the following year We are awaiting the governance decision from the board. This will decide on the future model of governance for the health and social care committee so for the time being we have not been able to look too far forward. 7 Conclusion At present the committee feels it is operating adequately. effective we need a decision on our future governance. However, to become more Melanie Newdick Chair Highland Health and Social Care Committee 9 th March 2017

25 25 Annual Report NHS Highland Asset Management Group 18 April 2017 NHS Highland Asset Management Group Annual Report To: NHS Highland Audit Committee From: Alasdair Lawton, Chair, Asset Management Group Subject: Asset Management Group Report April 2016 March Background In line with sound governance principles, an Annual Report is submitted from the Asset Management Group to the Audit Committee. This is undertaken to cover the complete financial year, and allows the Audit Committee to provide the Board of NHS Highland with the assurance it needs to approve the Governance Statement, which forms part of the Annual Accounts. The Asset Management Group is a formal Committee of the Board. The role of the Asset Management Group is: To support the process of all Asset Management and investment/disinvestment decisions now and in the future on behalf of NHS Highland. To ensure consistency with all policies and the strategic direction of NHS Highland and taking account of the requirement to remain within the Capital Resource Limit (CRL) and Revenue Resource Limit (RRL). The AMG must take into account all relevant statutory guidance and legislation as well as guidance issued by the Scottish and UK governments. The AMG has responsibility to o validate and maintain the Fixed Asset Register for NHS Highland o produce a draft Five Year Capital Programme for consideration by the Board with the first year based on firm SG allocations and subsequent years on indicative allocations o Monitor the in year programme against budget and allocate contingency funds as necessary. o Develop a priority-based, rolling Five Year Asset Management Plan. Develop an infrastructure investment matrix to ensure that the appropriate level of limited funds is invested in the areas of highest organisational risk. Oversight and monitoring of all non-profit distributing, hub and PFI type contracts The Board appointed a Non Executive Director Alasdair Lawton as chair of the Committee.

26 26 The Committee has met on 11 occasions during the financial year. The minutes of the Committee have been submitted to the appropriate Board meetings. Agendas comprise, Financial Monitoring Reports, Updates on Capital Projects, Business Cases for Major Capital (and Revenue Funded) Projects and bids for Smaller Capital Items e.g. equipment, consideration of all new or renewed property leases, consideration of the arrangements for managing the risks associated with each key asset stream, together with any ad hoc items. The Committee has scrutinized and reviewed a number of business cases, a response to the potential issues arising from the problems with the schools estate in Edinburgh, the Strategic Risk Register entry in relation to the management of assets, the Annual State of NHS Scotland Asset & Facilities Report 2015, consideration of a proposal to transfer 2.5m from Capital Resource Limit to Revenue Resource Limit and an approach for managing the risks associated with this transfer, considered an Internal Audit Report on Estates & Asset Management (and the management responses), considered the Ten-Year Capital Plan on behalf of the board and made recommendations to the Board all of which were subsequently approved. 2 Activity The Asset Management Group considered the following key items at its meetings throughout the year. Major Capital Projects / Capital Plan Redesign of Services in Badenoch & Strathspey Redesign of Services in Skye, Lochalsh & South West Ross Office Redesign Project Post Project Evaluation for the Forres, Woodside, Tain bundle Consideration of draft Ten-Year Capital Plan and recommendation to the Board for approval Approval of two replacement MRI scanners Approval of a business case for a CT simulator Minor Schemes Alterations to New Craigs to allow relocation of the endowments team Asset management system for Telecare/Community Equipment Stores Other Issues Consideration of a proposed 2.5m transfer from Capital Resource Limit to Revenue Resource Limit and review the arrangements for managing the resultant asset risks Consideration of a report relating to the potential issues arising from the PFI-built schools estate in Edinburgh Consideration of the 2015 Annual State of NHS Scotland Asset & Facilities Report Consideration of options relating to the GP surgery in Fort Augustus A lease relating to Boswell Health Centre A lease relating to Larachan House Relocating Cannich GP surgery surplus Replacement anaesthetic machines Provision of dialysis units Phototherapy unit Orthopaedics power tools

27 27 Provision of echo ultrasounds ENT mobile stack Various other smaller items replaced on a break-fix basis Approval of a process for managing asset transfer requests under the Community Empowerment Act Risk Management The Asset Management significantly increased its focus on Risk Management during 2016/17, partly in response to a request from the Board to provide a more formal line of sight for the Board regarding key asset risks. This included: Review of the entry relating to Asset Management on the Board s Strategic Risk Register Review of the Estates Risk Register Review of the ehealth Risk Register Consideration of arrangements for managing risk relating to medical equipment Consideration of the internal audit report on Estates and Asset management including the draft management responses 3 Membership from 1 April March 2017: Alasdair Lawton, Non Executive Director and Chair Alex Javed, Interim Radiology Service Manager from 24 January 2017 Iain Ross, Head of ehealth Deb Jones, Director of Strategic Commissioning, Planning & Performance Bob Summers, Head of Health and Safety Linda Kirkland, Director of Operations, Raigmore (until 19 July 2016) John Grieve, Public Representative from 24 January 2017 Carol Marlin, Monitoring Accountant Duncan Railton, Associate Specialist in Oral Surgery (joint ACF representative) Quentin Cox, Consultant Orthopaedic Surgeon (joint ACF representative) (until 30 August 2016) Dr Eileen Anderson, Consultant Radiologist (joint ACF representative) (from 28 February 2017) Eric Green, Head of Estates Ian Scott, Clinical Director, South & Mid (until 24 May 2016) Steven Brown, Head of Electromedical Equipment Michael Hall, Clinical Director, Argyll & Bute Neil Stewart, Head of Procurement Nick Kenton, Director of Finance Elspeth Caithness, Staff Side Representative Michael Foxley, Non-Executive member of NHSH Board from 24 January 2017 Christina West, Chief Officer, Argyll & Bute

28 4 Attendance from 1 April March 2017 Members: 26/04/16 24/05/16 21/06/16 19/07/16 30/08/16 20/09/16 25/10/16 22/11/16 20/12/16 24/01/17 28/02/17 21/03/17 Key Alistair Law ton, Non Executive Director & Chair V X X C X X X X X X X X Attended X Bob Summers, Head of Health and Safety V C X Meeting cancelled C Carol Marlin, Monitoring Accountant V X C X X X X X X Virtual Meeting V Christina West, Chief Operating Officer V C Deborah Jones, Director of Strategic Commissioning, Planning & Performance V C Duncan Railton, Associate Specialist in Oral Surgery & ACF rep V X X C X X X X Elspeth Caithness, H&S Stew ard & Staff Side Representative V C X X Eric Green, Head of Estates V X X C X X X X X X X Iain Ross, Head of ehealth Infrastructure Services C Ian Scott, Clinical Director, South & Mid V X C Linda Kirkland, Director of Operations, Raigmore V C Michael Hall, Clinical Director, Argyll & Bute CHP V X C X X X X Neil Stew art, Head of Procurement V X C Nick Kenton, Director of Finance V X X C X X X X X X X X Steven Brow n, Head of Elecromedical Equipment X X C X X X X X X X Katherine Sutton, AHPAssociate Director, Deputy Director of Operations V X C X X John Grieve, Public Representative X Quentin Cox Consultant Orthopaedic Surgeon & ACF rep X C X Michael Foxley, Non-Executive member of NHSH Board X Eileen Anderson, Representative of Area Clinical Forum X Non members in attendance: Kate Leishman, PA to Eric Green (minute) V X X C X X X X X X Kirsteen Stew art, Estates Support Manager (minute) C Mairi Simpson-Taylor, Senior Administrator Estates (minute) C Sarah Wilson, Estates Project Administrator (minute) X X X Heather Cameron, Senior Project Manager C X Harry Maclean, Deputy Head of Estates X David Whyte, Technical Services Manager Medical Physics X X C X X X X X X X David Ross, Head of Estates Argyll & Bute C Claire Stew art, Procurement Manager (on behalf of Neil Stew art) C X X X X George Morrison, Head of Finance Argyll & Bute CHP (on behalf of Christina West) X X C X X X X Maimie Thompson, Head of Public Relations & Engagement C Kenny Rodgers, Finance Manager S&M Highland C Nigel Small, Director of Operations S&M Highland C Douglas Philand, Team Leader Mid Argyll Community Mental Health Team C Alister McNicoll, Deputy Head of ehealth X X X X X X X Jan Baird, Director of Adult Care X C Deirdre Brindle, Capital Accountant X C X X Suzy Calder, Head of Service Substance Misuse C Ros Philip, Business & Contracts Manager X C Philip Wilson, Management Trainee X C X Karen Underw ood, Interim Head of Finance Raigmore C X Fiona Dale, Conventional Imaging TeamLeader C X X Gorgia Hare, Deputy Director of Operations South & Mid C Andrew Ward, Acting Divisional General Manger Surgical C X Tracy Ligema, Area Manager C X X Michelle Fraser, Capital Accountant C X X X Cameron Ferguson, Interventional TeamLead C X Gordon MacDonald, Project Director C X Gill McVicar, Director of Operations - North & West C David Park, Director of Operations, Inner Moray Firth Operational Unit X X X Alex Javed, Service Manager - Laboratories & (interim) Radiology X X X Melanie New dick, Vice Chair NHSH Board X Karen McNicoll, Divisional General Manager X 28

29 29 5 Sub Groups A Project Board is established for each major capital project chaired by the Senior Responsible Officer (SRO) for the project who is a Board level director. Currently there are five Project Boards: 5.1 Raigmore Critical Care Services Upgrade, SRO Nick Kenton, Director of Finance 5.2 Argyll & Bute Mental Health, SRO Nick Kenton, Director of Finance 5.3 Redesign of Services in Badenoch & Strathspey, SRO Deb Jones, Director of Strategic Commissioning, Planning and Performance 5.4 Redesign of Services in Skye, Lochalsh & South West Ross, SRO Deb Jones, Director of Strategic Commissioning, Planning and Performance 5.5 Elective Care Centre, SRO Deb Jones, Director of Strategic Commissioning, Planning and Performance 6 Emerging issues and key issues to address in 2017/2018 The main focus for the Asset Management Group in 2017/18 will be: Reviewing and Updating the NHS Highland Asset Strategy Maintaining capital expenditure within budget Completion of ongoing major capital projects Delivering the Full Business Case for the Critical Infrastructure Upgrades at Raigmore Hospital Developing an Outline Business Case for the Redesign of Services in Badenoch & Strathspey Developing an Outline Business Case for the Redesign of Services in Skye, Lochalsh & South West Ross Identifying the preferred option for Mental Health services in Argyll & Bute Developing an Initial Agreement for a Masterplan for the Morary Firth area Developing an Initial Agreement for the proposed Elective Care Centre on the Inverness Campus site It should be noted that the work of the AMG is set within the context of constrained national capital resources and therefore risk-based prioritization is crucial. There is a level of uncertainty regarding capital requirements, particularly given the backlog in replacing equipment, which means that unexpected breakages in-year are always possible. Flexible management of the overall budget is therefore key, both within and between financial years. 7 Conclusion Alasdair Lawton, as Chair of the Asset Management Group has concluded that the systems of control within the respective areas within the remit of the Asset Management Group are considered to be operating adequately and effectively. Alasdair Lawton Chair 17 April 2017