Introduction - Managing Finance In The Public Sector
Are you looking for Expert Assignment Writers in the UK? Native Assignment Help boasts a team of highly qualified writers who are ready to assist you with your academic needs. With our commitment to excellence, you can rest assured that your assignments are in good hands.
Financial capability is very much essential for any organisation. The finances should be managed well in any public sector to enhance the internal operations. Without proper management of finances it will be impossible to work with the framework provided by the Government. Here, for this report the selected country is the United Kingdom. At the same time, the health sector and associated services of the United Kingdom are the main topic of the report. In the meantime, a few topics will be given importance while making this report. The sources of funding for the health sector of the United Kingdom will be addressed in this report. In order to do this, detailed financial information along with the system, control and techniques of raising funds will be provided. At the same time, monitoring of the finances and its accountability will be given importance. Tenders will be documented and evaluated for the betterment of the process.
Task 1
Fund raising process in NHS
The NHS or National Health System is the healthcare system in the United Kingdom. This organisation is entirely funded by the public. With the help of public funds, the organisation has created the second-largest healthcare system in the entire world.
National Insurance Corporations and general taxation
As per the budget of 2021, the organisation has received 5.9 billion British pounds in addition. The total amount of the fund this year was 176.5 billion British pounds. National Insurance Corporations of the United Kingdom generally fund the organisation using the general taxations process (LUKIO, 2018). Starting from April of 2003, National Insurance Corporations increased the amounts of funds for the National Health System.
Patient charges
At the same time, patient charges also help to increase the share of funds in the National Health System. Starting from the early 1950s, the prescriptions and dental services are funding the organisation to provide better services to the patients. On the other hand, from patients fees and dental service charges the National Health System in the United Kingdom almost raised 1.5 billion British pounds in 2019. It was around 1.1 percent of the total budget of the organisation that particular year (Ajibo, 2020).
Additional funds
At the same time, other hospitals associated with the National Health System also generate some additional funds for the organisation. Hospitals trusts can raise some amount of money for the organisation. In order to sustain properly, the organisation also raises money while charging for parking services, cafeteria services, treatment of private patients etc.
Spending review process and its importnace
Spending review process of the Government of the United Kingdom monitors the entire fund raising process of the National Health System. At the same time, this review process also helps to estimate the amount of budget and the required finances for the healthcare sector of the United KIngdom. In addition to that, this review process decides how much amount will be extracted from the sources. Between 2007 to 2011, the user charges of the organisation was 1.2 percent (Zhao et al., 2022).
Operations using these funds and limitations of these funds
The operations of the National Health System of the United Kingdom is a bit unique. General taxation is the major fund for the organisation. At the same time, since 1951, the patients have had to provide some of the service charges. Some additional costs like cafeteria charges, parking charges etc are there. National insurance also plays an important role while funding the organisation.
Taxation
In order to fund the National Health System, tax revenues are collected from the public. As per the rule of the country, direct taxes are levied on individuals, households and companies. Indirect taxes are collected from the products, services. Central and local governments both together can collect the taxes from the public. At the same time, methods of collecting taxes can be different based on the principles of the central and local government of the United Kingdom.
Private health insurance
Healthcare policies from the private organisation also fund the National Health System. Policyholders generally contribute to the organisation for their own purposes. Individual risk of health often plays an important role while paying for the funds. At the same time, community risk also is given importance while deciding the contribution. On the other hand, group risk is also estimated. In 1990, in the country, tax was relieved for the senior citizens (Zhao et al., 2022). It wanted to help the national Health system though in 1997, the system was abolished. Government is helping the population to take private health insurance so that they can fund the healthcare sector of the country.
Social health insurance
A package of services will be provided to the employees when they will buy this social health insurance. Employees generally contribute a significant amount of their salary to build up this insurance. At the same time, some of this insurance contributes to the internal system of the National Health System. In general, this scheme can not raise huge funds for the organisation alone (NHS, 2022).
User charges
Small medical care also takes charges from the patients. At the same time, these user charges help the organisation with funds. User charges mainly are taken from the countries at a very small amount. This includes charges for the prescription, payment for the general physician, charges of the hospital treatment. The National Health System also charges the patients while providing them bedside entertainment options. User charges also can be applied when the patients ask for private care from the organisation. At the same time, parking facilities, cafeteria facilities, etc can be included as the user charges by the National Health Services (Mackey et al , 2018).
Limitations
The organisation mainly has to depend on the general taxation procedure. General taxations depend on the yearly income of the individuals. At the same time, the income of an individual depends on the economy of the country. Due to Brexit and the pandemic situation, the United Kingdom has gone through a lot. The country witnessed financial depression for a long time. Any time, the general taxation process can generate very low funds for the organisation. Unpredictable situation of the healthcare system is also a limiting factor while raising funds for the National Health System. Private health insurance is quite unpredictable in nature as well. It can be denied by the insurers any time and the funds can be ceased. On the other hand, to use it as a source of fund, it requires to be regulated very heavily. High management and administrative cost will be required to manage funds from the private insurance companies (Mackey et al , 2018). At the same time, if the insurers and people switch in between, the administrative cost of social insurance will be raised. It will negatively impact the funds of the National Health System. User charges can be sometimes expensive for the middle class families. They tend to refuse any kind of treatment from the National Health System.
Information NHS required to report
To generate funds from all the possible sources, the National Health System requires to report a few information. First of all, a budget will be made where all the financial requirements of the National Health System will be mentioned. In this budget, the possible expenditure will be mentioned as well. At the same time, the budget of the previous year will be required to provide. In that budget, the total collection of funds, expenditure of the organisation will be clearly mentioned (England, 2022). At the same time, to collect user charges the organisation should prepare a chart where all the utility bills will be mentioned. For the other purpose of user charges, the National Insurance System needs to provide a proper set of information. For the private and social health insurance, the organisation needs to mention how much charges will be accepted for the organisation.
Task 2
a) Economic responsibility of the NHS sector
The financial planning process helps an organisation achieve its strategic goals and activities within its assets (Haseeb et al., 2019). The principal objective of the financial analysis and planning team is to aid executives in the development of short- and long-term goals, conduct price analyses, and perform a regular review to ensure that goals are reached. In supplying pertinent financial details, it is also the role of the controller to assure that top management receives approval in profit for the firm. The essential components of financial analysis and planning include forecast, planning, monitoring, and evaluation. N.H.S. England can keep making the major portion of choices freely, discussing with administration and more as required (England and Improvement, 2019).
The Secretary of State and Parliament can decide to maintain N.H.S. England accountable (Hammond et al., 2019). However, while N.H.S. England would then have greater powers and responsibilities; the accountability systems must mirror these new powers. To provide adequate public supervision, they provide the Secretary of State the authority to conduct N.H.S. England. From the general public perspective, the N.H.S. as a whole, and as regional healthcare systems collaborate increasingly closely, the same must happen at the government level. By fully combining N.H.S. England and N.H.S. Improvement, people will eliminate these final administrative and legal barriers, allowing the business to deliver strong national leadership.
Many such changes will help the Secretary of State use clear instructions and the innovative, more flexible Policy to create proper treatments to set a clear vision, support accountability and flexibility as in framework, and help governments help N.H.S. England confirms its work with wider objectives for healthcare provision. In essence, this one will make the Secretary of State and the government more efficient to the House of Commons for the N.H.S. and the wider health and care system (GOV.UK, 2022). Department of Public health and N.H.S. The improvement provides 2016-17 Financial Monitoring and Accounting and Managerial Accounting Forms. The aspects also provide a full number of economic schedules for the 2016-17 joined financial statements and the normal monthly user management NHSI needs to monitor N.H.S. facilities (Assets.publishing.service.gov.uk, 2022).
b) Financial monitoring and management of the public sector
The significance of financial planning is a topic unto itself, but keeping to the strategy is frequently the most challenging aspect. Technologies that monitor productivity assist in overcoming these challenges since they ensure that they do not even lose sight of the goals and provide them with the potential to take remedial action should events go wrong. Mostly on the finance aspect, businesses will also want to monitor ratios such as the gain and phase margins to determine their profitability. They will want to ensure the firm's future by monitoring their income stream to identify any negative movements. They may wish to track financial comparisons such as customer days to determine whether or not company consumers are paying on schedule.
They have obtained assets to fund the business's development; they will want to observe their fast and present proportions, for illustration, to verify that their company can achieve its debt obligations (Dolfinblue.com, 2022). Trying to put restrictions on skills and hiring only licensed, professional financial management and employees to help make and perform financial policies. Arranging a clear and effective way for the accounting staff, financial managers, and top management, including the C.F.O., to communicate. Accountants and others have regular training and support discussions to ensure they are world current on new laws and changes in the business (Corporate Finance Institute, 2022).
c) Decision-making process of the public sector
The financial decision-making process is very important for using corporate funds (Greenberg et al., 2019). Financial decision-making also helps to use the fund and regulate the financial department properly. On the other hand, the financial decision-making process helps N.H.S. health care with the proper use of funds. Apart from that, financial decision making has guided the N.H.S. on how and where the fund has to be used. So that financial decisions make deals with the fund and provide financial support.
Furthermore, financial decision making has helped the N.H.S. maintain an efficient fund so that the N.H.S. can run smoothly. Apart from that, decision making is important for the N.H.S.'s managers and with the help of this process, they can take the necessary steps for N.H.S. health care. So, decision-making process plays a crucial role in running the business.
Along with N.H.S. makes a lot of decisions in a day which is important for running the organization. After that, the financial decision-making process has mainly three types: investment decisions, financial decisions, and dividend decisions that N.H.S. health care managers make. Apart from that, these decisions help managers of the N.H.S. monitor funds and analyze requirements. An investment decision is called a Budget decision because it's focused on the budget (Daryanto et al., 2020). Investment decisions also help managers analyze cash flow, profit, and investment criteria. For example, that organization forecasts to adopt new technology in N.H.S. healthcare and then financial decision-making process plans to analyze the requirements whether new technology is needed or not. Suppose needed then what amount should be allocated, and is this benefit to the N.H.S. or a waste of funds. So, that Decision-making plan analyzed the need and guided cash flow.
Investment decision plans also guide N.H.S.'s profit and regulated cash flow. The Financing decision plan has analyzed N.H.S. health care's cost, internal risk, cash flow position and condition of the market (nursinganswers.net, 2022). Aside from that, a financial decision-making plan helps with cost-cutting and selecting cost-efficient sources. On the other hand, a financial decisions plan identifies the risk factors of an investment fund and guides cash flow. Furthermore, the decision-making plan analyzes the market condition and directs financial investment. For example, the ratio of N.H.S. health care patients and healthcare workers is analyzed in corporate profits. If health workers are increased as per ratio, annual profit should ultimately be diminished. So, N.H.S. health care management has to plan with the help of a financial decision-making process whether employees are required or not and how many employees should be appointed.
After that, employees should be analyzed. So, the decision-making plan plays an important role in enhancing N.H.S.'s profits. On the other hand, a decision-making plan reduces high costs and procures its fund. In addition, managers of the N.H.S. use decision-making plans and take the necessary steps to run the business. Apart from that, N.H.S. management controls cost reduction and reduces risk factors. Apart from that, dividend decisions are another important tool of the N.H.S.'s management (nursinganswers.net, 2022). Aside from that, the dividend decision assists in analyzing N.H.S.'s annual earning, dependability in earning, balance dividend and development opportunity. After the N.H.S. is a healthcare organization in the U.K., health cost is the main source of profit that comes from patients (Karalis and Barbery, 2018). So, a decision-making plan helps maximise profits and make important decisions that are important for further growth.
Decision-making plans to assist in controlling stable annual earnings and maintaining an early profit. Moreover, dividend decisions help invest the fund in development so that profit should be enhanced for N.H.S. health care (nursinganswers.net, 2022). For example, if the N.H.S. invests its funds to develop a health unit for business growth, managers or management use a financial decision-making process to analyze whether an investment is cost-benefit or risk and whether it will provide long-term profit. After that, if revenue comes, then what amount. So, the decision-making process helps to assist the proper investment of funds. On the other side, the financial decision-making process helps develop organizational structure and financial growth. After that, the financial decisions making process is the backbone of the N.H.S. health care unit.
Task 3
Tender documentation
When a printed or electronic process is used, the deal notice will also include advice on connecting the tender document. The tender document issued by the purchasing organization describes the buyer's needs and specifications in significantly greater depth than what a contract notice could. The N.H.S. spends billions of pounds per year on purchasing goods and services and tends to work from providers in the U.K. and worldwide (Reed et al., 2019). This gives companies a lot of chances to get agreements with the National Health Service that can be financially beneficial and bring in money over the years. The National Health Service always faces big problems, such as funding cuts and a global pandemic. For this, it is searching for new suppliers who can develop innovative solutions.
Tender process for NHS: There has been a wide range of National Health Service tenders, such as cleaning, I.T., construction, and personal protective equipment (P.P.E.). If they have done the N.H.S. tender process before or not, people can help determine the best opportunities and improve their tender to get N.H.S. agreements, no matter their background. Most public sector tenders, such as the National Health Service, are purchased in various ways based on how much the agreement is worth. But the strategy is the same for every tender. Almost all of the time, the following process makes up the tendering process:
1.Many commissioners can send out a prior information notice (P.I.N.), an early notification of the tender opportunity. It can happen anywhere from 2 to 12 months after the contract ends.
2.An agreement notice can be used to start the tendering process. This generally includes understanding the project and information about the agreement, such as the phases and what is expected at each phase and by what date.
However, a "conference the buyer" activity is planned, which is a great chance to learn more about the National health service tender or agreement and ask what they may have. It also is an excellent way to meet people and find possible trading partners.
4.Almost always, now the next step before they can genuinely bid for the agreement is to fill out a pre-qualification questionnaire (PQQ) or a selection questionnaire (S.Q.) (Menteth and Sawyers, 2021). It helps to make sure only the most qualified businesses move on in the procedure and, therefore, can do the work.
The essential next step is to obtain an invitation. This is where they will put together a winning bid to demonstrate why their company is the best option.
6.When the bids have been sent in and got, there may well be a step to talk to a few hopefuls who are still in the running. This gathering is often set up like a demonstration, giving customers another important chance to show what they can do.
There would be an ultimate decision, and everyone will be told about it.
Benefits of winning an N.H.S. contract: After its approaches have been received and assessed, it may be necessary to discuss them with the competitors. This is usually a presentation-style conference, another crucial opportunity to show its worth. As previously noted, the N.H.S. needs suppliers from a vast array of products and services. This makes it an attractive prospect for businesses looking to grow and possibly increase their services. N.H.S. tenders are long-term deals or framework agreements to provide the organization with continuous, recurring work (Sanchez-Graells, 2019). A perspective of possible employment and income over the long term is always useful for business planning. Also, are these often successful, leading to other changes in the other public sector. Payment for N.H.S. agreements is also beneficial, with 30 days in agreement with the administration's fast payment strategy.
Furthermore, the N.H.S. tender needs a strong tender. Knowing the tender opportunities and scope of the project will help them determine if this is the correct agreement for them and design tenders with the specifications in mind. Easily change any proposal to remain out of the competitors. They appreciate that keeping an N.H.S. tender can become a pain and a hazard for many businesses. N.H.S. tenders are thorough good tender exhibit value for the money, clearly describe capabilities, and address hospitals' sensitive, frequently live environments. As tender experts, they have helped the business identify N.H.S. tenders, design successful proposals, and add to enhancement. Contact them if they need help writing a successful N.H.S. tender.
Scoring method
Identifying scoring systems is essential to the method and tender monitoring system while creating a tender suggestion. It enables visitors to determine how their responses must be valued in length and depth compared to other factors. Some scoring factors can seem very distinct from the others, and they change depending on every need of the clients and long-term goals. Competition for tenders can be difficult. a 30,000-word tender reply the day before the holidays, using all waking moments to ensure that the price is correct and the contents are of the best quality possible. (Tender Consultants, 2022). Then consider how well the decision-makers feel as they mark every essay. As Tender Writing Consultants, they always suggest being brief and following the findings method.
This also makes it very easy for the evaluation when scoring the tender, reducing the time to check what is required. Still, it also makes it easier for them to focus on the most crucial aspects the purchaser requires when collapsing their responses. The tendering method can be extremely intricate and meaningful. The tender process is one of the most common tenders methods (Lenderink et al., 2020). This methodology enables any company to tender for the contract. The government's tender methods identify the best contractor for every project. Probity, honesty, and value for the money guide the process. Undertaking new projects have typically gone to the successful tenderer. Most companies will continue to issue bids this way.
Tender guidelines:1. Performance under conditions that indicate the importance of selection criteria:
2.Scores that also are created on the data submitted with the tender proposal; and
Connecting the non-price necessities and the tender value already having to apply the weightage to see the right impact and advantage of the scoring system.
Furthermore, the selection process has been used to score every tender based on the bidders' capability to execute the task. The measures are usually chosen from; appropriate experience, task preference, past performance; administration and methodological skills; help; controlling systems; process, and cost. As per the Nation of the Government 2020-21, a partnership between business services firm Deloitte and British research group Change that receives the public’s opinion, sector executives, as well as persons working just at the global stage of U.K. government facilities, and over half of a community 58 % believes that perhaps the COVID-19 global epidemic will reduce opportunities for youth (Prospects. ac. the U.K., 2022).
Conclusion
In order to improve the internal functions of any organisation, finances will be required. Proper management of finance can help the organisation to get success as soon as possible. Without managing the finances it will be impossible to improve the internal functions of any organisation. In this report, the healthcare sector of the United Kingdom is chosen for this report. At the same time, in this report, the sources of funding essential for the organisation are discussed. At the same time, techniques, controls of fundings are discussed here as well. The entire project has given importance to the application of a tender system while managing finances of the healthcare sector in the United Kingdom. On the other hand, accountability of finances and its roles to enhance the performance of the healthcare sector are mentioned clearly in this report. This report is basically giving importance on finance and its management in the public sectors of the United Kingdom.
Reference
Ajibo, H., (2020). Effect of COVID-19 on Nigerian socio-economic well-being, health sector pandemic preparedness and the role of Nigerian social workers in the war against COVID-19. Social work in public health, 35(7), pp.511-522.
Assets.publishing.service.gov.uk, (2022). [online] Assets.publishing.service.gov.uk. Available at: <https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/603189/Q4_2016-17_FMA_Guidance.pdf> [Accessed 26 May 2022].
Daryanto, S.M., Fahmi, M. and Djanegara, M.S., (2020). Impact of DAPODIK Information Quality on Optimization of Education Budget Decision Making from User Perspective. Journal of Talent Development and Excellence, 12(3s), pp.2811-2828.
Dolfinblue.com, (2022). The importance of monitoring financial performance | Dolfinblue. [online] Dolfinblue.com. Available at: <https://www.dolfinblue.com/the-importance-of-monitoring-financial-performance/> [Accessed 26 May 2022].
England, N., (2022). NHS England » Financial accounting and reporting updates. [online] England.nhs.uk. Available at: <https://www.england.nhs.uk/financial-accounting-and-reporting/financial-reporting/> [Accessed 27 May 2022].
England, N.H.S. and Improvement, N.H.S.,( 2019). Personalised care. London: N.H.S.
GOV. The U.K., (2022). Health and Care Bill: improving accountability and ensuring public confidence – N.H.S. accountability measures. [online] GOV.UK. Available at: <https://www.gov.uk/government/publications/health-and-care-bill-factsheets/health-and-care-bill-improving-accountability-and-ensuring-public-confidence-nhs-accountability-measures> [Accessed 26 May 2022].
Hammond, J., Speed, E., Allen, P., McDermott, I., Coleman, A. and Checkland, K., (2019). Autonomy, accountability, and ambiguity in arm's-length meta-governance: the case of N.H.S. England. Public Management Review, 21(8), pp.1148-1169.
Haseeb, M., Hussain, H.I., Kot, S., Androniceanu, A. and Jermsittiparsert, K., (2019). Role of social and technological challenges in achieving a sustainable competitive advantage and sustainable business performance. Sustainability, 11(14), p.3811.
Karalis, E. and Barbery, G., (2018). The common barriers and facilitators for a healthcare organization becoming a high reliability organization. Asia Pacific Journal of Health Management, 13(3), pp.1-13.
Lenderink, B., Halman, J.I., Boes, H. and Voordijk, H., (2020). A method to encourage and assess innovations in public tenders for infrastructure and construction projects. Construction innovation.
LUKIO, O.O., (2018). Influence of Donor Regulations on Effective Utilization of Health Sector Funds in the Former Nyanza Province (Doctoral dissertation, JKUAT).
Mackey, T.K., Vian, T. and Kohler, J., (2018). The sustainable development goals as a framework to combat health-sector corruption. Bulletin of the World Health Organization, 96(9), p.634.
Menteth, W. and Sawyers, B., (2021). U.K. Data Analysis and Research. Menteith, W & Sawyers (eds).
NHS, (2022). [online] Available at: <https://www.kingsfund.org.uk/publications/how-health-care-is-funded#user-charges> [Accessed 27 May 2022].
Prospects.ac.uk, (2022). Overview of the UK's public services sector | Prospects.ac.uk. [online] Prospects.ac.uk. Available at: <https://www.prospects.ac.uk/jobs-and-work-experience/job-sectors/public-services-and-administration/overview-of-the-uks-public-services-sector> [Accessed 26 May 2022].
Reed, S., Göpfert, A., Wood, S., Allwood, D. and Warburton, W., (2019). Building healthier communities: the role of the N.H.S. as an anchor institution. London: The Health Foundation.
Sanchez-Graells, A., (2019). Centralisation of procurement and supply chain management in the English N.H.S.: some governance and compliance challenges. N. Ir. Legal Q., 70, p.53.
Tender Consultants, (2022). Bid Tender Writer: 3 Ways They Can Improve Your Chances of Success. [online] Tender Consultants. Available at: <https://www.tenderconsultants.co.uk/bid-tender-writer/> [Accessed 27 May 2022].
Zhao, J., Kim, M., Westbrook, G. and Bratzler, D.W., (2022). A comparative study of COVID-19 emergency funds allocated to the health sector: US, UK, and Canada. Health Policy.
nursinganswers.net, (2022). Financial Management of the National Health Service (N.H.S.). [online] NursingAnswers.net. Available at: <https://nursinganswers.net/essays/financial-management-national-health-service-7269.php> [Accessed 26 May 2022].
Corporate Finance Institute, (2022). Financial Controls. [online] Corporate Finance Institute. Available at: <https://corporatefinanceinstitute.com/resources/knowledge/finance/financial-controls/> [Accessed 27 May 2022].
