Parliamentary and Health Service Ombudsman
Moving forward - Annual Report 2011-12

Details

PHSO’s 2011-12 funding arises from a four-year settlement sanctioned by HM Treasury, with annual Estimates based on this settlement approved by Parliament. Our four-year settlement for the period 2011-15 was sanctioned in October 2010. In April 2011, PHSO’s Executive Board agreed a Financial Strategy for the four years 2011-12 to 2014-15. It provides the framework that will support and enable the delivery of the four-year settlement, including all necessary cash savings, whilst ensuring that PHSO can also deliver our strategic and enabling objectives effectively and efficiently. An underpinning four-year Capital Investment Strategy was also agreed.

PHSO’s sanctioned 2011-12 baseline funding was amended in-year through a Supplementary Estimate, sanctioned in January 2012.

We met all six of our voted funding and budget limits and all seven of the financial management targets in our Corporate Business Plan.

The performance on each was as follows:

  • our net resource underspend of £354k was within our target limit for underspending of less than £500k (£1,297k underspend in 2010-11); the underspend mainly comprises unused unallocated funding of £185k
    held in reserve; reduced spend for bought-in professional services of £104k; and expenditure offset by £64k of additional income mainly arising from the provision of more clinical advice services to other ombudsmen than was expected;
  • our total capital underspend of £39k met our target limit for underspending of less than £100k (£503k underspend in 2010-11);
  • we recovered 100% of retainable income due in the year, meeting our target of 100%;
  • we remained within the Net Cash Requirement sanctioned by Parliament;
  • we paid 99.7% (99.7% in 2010-11) of supplier invoices within our target of 99% of correctly presented invoices paid within 30 days of receipt;
  • our resource budgets were managed to within 1% of agreed allocations, within our target of limiting budget variances to no more than 2%; and
  • our month-on-month budget forecast variances were managed to an average accuracy of 1% over the year, within our tolerance target of no more than 2%.

Our sanctioned 2011-12 baseline resource and capital budgets for the year were as follows:

  Main estimate
£000		 Supp. Estimate
£000		 Revised Baseline
£000
Total Net Budget:      
Resource (Voted) 33,413 (200) 33,213
Resource (Non-Voted) 187 - 187
Capital 700 (50) 650

Statement of Parliamentary Supply
Summary of Resource Outturn 2011-12

2011-12 2010-11
  Estimate Outturn    
  Voted
£000
 Non-Voted
£000		 Total
£000		 Voted
£000		 Non-Voted
£000 		 Total
£000		 Voted outturn
compared to
Estimate:saving/(excess)
£000		 Outturn
£000
Departmental
Expenditure Limit		                
- Resource 33,363  - 33,363 33,009 - 33,009 354 33,084
- Capital 650 - 650 611 - 611 39 847
Annually Managed
Expenditure		                
- Resource (150) - (150) (158) - (158) 8 (239)
- Capital - - - - - - - -
Total Budget 33,863 - 33,863 33,462 - 33,462 401 33,692
Non-Budget                
-Resource - 187 187 - 188 188 - 193
Total 33,863 187 34,050 33,462 184 33,650 401 33,885
Total Voted Resources 33,213 - 33,213 32,851 - 32,849 362 32,845
Total Capital 650 - 650 611 - 611 39 847
Total 33,863 - 33,863 33,462 - 33,462 401 33,692

Explanations for variances between Estimate and Outturn are given in note 2.1 and the Management Commentary.

For Estimates purposes, all PHSO’s spend is classified as Programme. The Statement of Parliamentary Supply does not therefore report against an Administration Cost Limit.

Figures in the areas highlighted in bold are voted totals subject to Parliamentary control.

Net Cash Requirement 2011-12

2011-12 2010-11
  Estimate
£000		 Outturn
£000		 Net total
outturn
compared to
Estimate:
saving/(excess)
£000		 Outturn
£000
Net Cash Requirement 32,613 31,861 752 32,185

Statement of Comprehensive Net Expenditure for the year ended 31 March 2012

2011-12 2010-11
£000 £000
Administration costs
Staff costs 21,619 21,325
Other administration costs 11,821 12,016
Gross administration costs 33,440 33,341
Operating income (248) (310)
Net administration costs 33,192 33,031
Net operating cost 33,192 33,031

Other comprehensive expenditure

Net gain/(loss) on revaluation of property, plant and equipment 5 11
Other comprehensive expenditure 5 11
Total comprehensive expenditure for the year ended 31 March 2012 33,197 33,042

All operations are continuing.

Statement of Financial Position as at 31 March 2012

   31 March 2012  31 March 2011
  £000   £000  
Non-current assets        
Property, plant and equipment 4,348   5,308  
Intangible assets 285   279  
Total non-current assets   4,633   5,587
Current assets        
Trade and other receivables 1,375   1,427  
Cash and cash equivalents 68   45  
Total current assets   1,443   1,472
Total assets   6,076   7,059
Current liabilities        
Trade and other payables (2,338)   (2,023)  
Other liabilities (136)   (111)  
Total current liabilities   (2,474)   (2,134)
Non-current assets less net current liabilities   3,602   4,925
Non-current liabilities        
Provisions (521)   (679)  
Other liabilities (405)   (476)  
Total non-current liabilities   (926)   (1,155)
Assets less liabilities   2,676   3,770
Taxpayers’ equity        
General Fund 2,201 3,243
Revaluation Reserve 475 527
Total taxpayers’ equity   2,676   3,770

Dame Julie Mellor, DBE
Parliamentary and Health Service Ombudsman
21 June 2012

Statement of Cash Flows for the year ended 31 March 2012

2011-12
£000 		2010-11
£000
Cash flows from operating activities
Net operating cost (33,192) (33,031)
Adjustments for non-cash transactions 1,636 1,566
(Increase)/decrease in trade and other receivables 52 10
Increase/(decrease) in trade payables 269 37
“Less movements in payables/receivables relating to items not passing through the Statement of Comprehensive Net Expenditure” (26) (10)
Use of provisions (160) (239)
Net cash outflow from operating activities (31,421) (31,667)
Cash flows from investing activities    
Purchase of property, plant and equipment (471) (548)
Purchase of intangible assets (154) (158)
Net cash outflow from investing activities (625) (706)
Cash flows from financing activities    
From the Consolidated Fund (Supply): current year 31,886 32,204
From the Consolidated Fund (Non-Supply) 188 193
Net financing 32,074 32,397
Net increase/(decrease) in cash and cash equivalents in the period before adjustment for receipts and payments to the Consolidated Fund 28 24
Payments of amounts due to the Consolidated Fund (5) (16)
Net increase/(decrease) in cash and cash equivalents in the period after adjustment for receipts and payments to the Consolidated Fund 23 8
Cash and cash equivalents at the beginning of the period 45 37
Cash and cash equivalents at the end of the period 68 45

Statement of Changes in Taxpayers’ Equity for the year ended 31 March 2012

General Fund Revaluation Reserve Total Reserves
£000 £000 £000
Balance at 31 March 2010 3,783 590 4,373
Net Parliamentary Funding - drawn down 32,204 - 32,204
Net Parliamentary Funding - deemed 21 - 21
Consolidated Fund Standing Services 193 - 193
Supply payable adjustment (40) - (40)
CFERs payable to the Consolidated Fund (7) - (7)
Comprehensive net expenditure for the year (33,031) - (33,031)
Non-cash charges - auditor’s remuneration 50 - 50
Net gain/(loss) on revaluation of property,
plant and equipment 		(4) 11 7
Transfers between reserves 74 (74) -
Balance at 31 March 2011 3,243 527 3,770
Net Parliamentary Funding - drawn down 31,886 - 31,886
Net Parliamentary Funding - deemed 40 - 40
Consolidated Fund Standing Services 188 - 188
Supply payable adjustment (65) - (65)
CFERs payable to the Consolidated Fund (6) - (6)
Comprehensive net expenditure for the year (33,192) - (33,192)
Non-cash charges - auditor’s remuneration 50 - 50
Net gain/(loss) on revaluation of property,
plant and equipment 		5 - 5
Transfers between reserves 52 (52) -
Balance at 31 March 2012 2,201 475 2,676

The General Fund serves as the operating fund. The General Fund is used to account for all financial resources except those required to be accounted for in another fund.

The Revaluation Reserve records the unrealised gain or loss on revaluation of assets.

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