Powys Teaching Health Board escalation framework: August 2025

Following an assessment against the NHS Wales oversight and escalation framework in November 2024, the current escalation level of Powys Teaching Health Board is level 4 for finance, strategy and planning.

Level 4 (targeted intervention) is the second highest level of escalation within the NHS oversight and escalation framework. It is applied when organisations have serious problems and where there are concerns that they cannot make the necessary improvements without external support. 

At this level of escalation, the Welsh Government will take and co-ordinate action and direct intervention to support the health board to strengthen its capability and capacity to drive improvement. It consists of a set of interventions designed to remedy the problems within a reasonable timeframe. The interventions will normally be undertaken by NHS Wales Performance and Improvement (NHSP&I) directed by the Welsh Government. If appropriate, external support will be agreed with the organisation.

In September 2023, Powys Teaching Health Board was escalated to enhanced monitoring for finance, strategy and planning as the health board was unable to produce an approvable balanced three-year plan in accordance with the direction given by Welsh Ministers and the NHS Planning Framework, which could be considered for approval under section 175(2A) of the NHS (Wales) Act 2006 (“the 2006 Act”). On 22 January 2024, the Minister for Health and Social Services confirmed the escalation status of Powys Teaching Health Board would remain as being in enhanced monitoring for finance, strategy and planning.

In November 2024, the health board was escalated to level 4 for finance, strategy and planning following a widening financial deficit.

The NHS Wales oversight and escalation framework sets out the process by which the Welsh Government maintains oversight of NHS bodies and gains assurance across the system. It describes the escalation, de-escalation and intervention process, the five levels of escalation and the domains against which each health board will be assessed.

During escalation, interventions will be:

• collaborative: we will seek to minimise duplication by working collaboratively with other national committees, groups and programmes
• collective: we will maximise shared knowledge by sharing common approaches, tools, guidance.
• impact focussed - we will examine and seek assurance and evidence how organisations are obtaining assurance over delivery and impact of actions.
• be undertaken with openness, transparency, and mutual trust and respect between the health board, the Welsh Government, and NHSP&I

Whilst the health board is in escalation:

• Normal performance management arrangements will continue through the Integrated Quality, Planning and Delivery Board (IQPD) and Joint Executive Team (JET) meetings.
• Quarterly escalation meetings will be chaired by the Director General of the Health, Social Care and Early Years Group and Chief Executive NHS Wales.
• finance, strategy and planning level 4 touchpoint meetings will be agreed with the Finance, Planning and Delivery team within NHSP&I. These will examine progress made against the action log, review evidence and agree outputs for inclusion at the Welsh Government-led escalation meetings. 

This framework sets out the expectations for de-escalation against each area and domain of escalation. Where possible, these de-escalation criteria are consistent with other health organisations in escalation.

De-escalation will be no more than one level at a time with reduced oversight and intervention at each stage of de-escalation. De-escalation from level 3 (enhanced monitoring) will typically be to level 1 (routine arrangements).

To be considered for de-escalation, an organisation must demonstrate that progress towards the de-escalation criteria is being made.

There are 2 approaches to de-escalation:

• The Welsh Government will coordinate activity to closely monitor, challenge and review progress made by the NHS organisation. If the NHS organisation can provide evidence of sufficient and timely improvement, then the Welsh Government and external review bodies will share knowledge to enable them each to consider whether de-escalation of the intervention arrangements placed on the NHS organisation is appropriate. For de-escalation to occur, the NHS body may not have achieved all of the de-escalation criteria, but they will need to demonstrate sustained improvements with a credible improvement plan to maintain improvements.
• De-escalation for those areas with quantifiable outcomes and targets such as performance and outcomes will take place once the de-escalation criteria have been met and sustained for the agreed period of time. If the NHS organisation meets the de-escalation criteria for a specific domain or sub-domain then they will be de-escalated to the next level on the escalation scale. This de-escalation will be automatically triggered outside of the normal escalation cycle and will be confirmed in writing to the organisation. 

The roles and responsibilities of the Welsh Government are to:

• support a formal structure for reviewing and reporting progress
• signpost relevant best practice guidance and frameworks
• act as a critical friend and sounding board on existing practices and new developments
• review and provide feedback on developed products
• undertake and share relevant analysis and deep dives of national data
• enable shared approaches to key national issues across Welsh NHS organisations and promote shared learning
• direct NHSP&I or make alternative arrangements to provide targeted support to areas of concern to help the health board to improve their progress against programme objectives
• work with the health board on critical enablers relating to regional planning, clinical services redesign, infrastructure (digital and buildings)

The roles and responsibilities of the health board are to:

• appoint an SRO (designated point of contact) to lead the health board’s response to the escalation
• ensure Board ownership and oversight with a clear governance structure, ensure that the Board is appraised of the escalation plan and evidence regular progress updates to the Board on progress against de-escalation criteria
• to produce a level 4 action plan in response to the areas of concern and commit sufficient resources to ensure that the plan deliverables are achieved
• provide quarterly progress reports and evidence against the escalation plan to the Welsh Government
• strengthen the formal review mechanisms to support urgency in delivering confidence and improvement to the financial position

Finance

The finance intervention and focus whilst in level 4 covers the following areas.

The health board will be required to take action to strengthen its financial governance and control environment and demonstrate:

• the financial governance framework is robust in both design and implementation, including a self-assessment against best practice frameworks
• the financial committee structure is clearly articulated and actively addresses key risks
• financial controls are robust in both design and implementation
• the finance function has the necessary capacity and capability to support the needs of the wider organisation
• financial reports include the analysis and narrative explanation required to enable management and Board to discharge their duties
• integrated reports provide the Board with a clear understanding of the interlink between financial performance and operational performance including the organisation’s productivity and efficiency
• budgets are set with alignment to the plan and budget management is effective, with budget holders held to account for delivering their financial plans
• as a result of the above, it has developed and is delivering an action plan to improve the financial governance and financial control environment

The health board will be required to demonstrate an understanding of the existing deficit and key drivers, and ensure there is:

• a clear understanding of the cost drivers and investment decisions responsible for the growth in deficit across the organisation, including an explicit breakdown by key service area and cost drives
• a clear and robust process for challenging underlying deficits reported at local divisional levels
• a clear understanding and management of the reasons for, and the drivers of, the underlying deficit and increasing cost pressures reported within commissioned services
• a clear understanding and management of the drivers responsible for the cost growth and high-cost base within continuing healthcare (CHC) and NHS-funded nursing care (FNC)
• a clear understanding and management of the drivers responsible for cost growth and high-cost base within prescribing
• A clear and understanding and management of the cost drivers and investment decisions responsible for the growth in workforce costs, alongside workforce capacity constraints and clear development actions to support a sustainable workforce
• as a result of the above, there are triangulated approaches to identify and deliver actions to improve efficiency and maximise the sustainable use of resources

The health board must focus on the development and realisation of opportunities and ensure that:

• national opportunities identified through the Value and Sustainability Board are translated into local savings schemes
• Value based health care (VBHC) principles have been embedded across the organisation and VBHC plans are delivered
• all prior year investments have been reviewed to assess whether the planned benefits have been delivered
• there is a clear process for the development and delivery of strategic opportunities to support the health board’s sustainability

The health board will be required to develop and deliver a clear financial plan and strategy and demonstrate:

• an integrated plan is in place that will deliver the target control total of a £12 million deficit in 2025 to 2026 at a minimum and demonstrates greater progress towards delivery and efficiency of services within available resources and a route to delivering the break-even duty
• a clear engagement plan to communicate the necessity for financial improvement across the organisation

Aligned to delivery of its financial plan, the health board must demonstrate:

• delivery of financial performance for 2025 to 2026 in line with the financial plan and progress towards delivering the break-even duty by reducing the value of the underlying deficit
• delivery of the target in-year and full-year effect savings and progress in the transformational schemes necessary to support future financial sustainability
• that in-year choices are identified and taken early to mitigate any emerging pressures
• that clear performance management processes are in place to manage the delivery of emerging variations within commissioning contracts and to take appropriate risk-based choices to address budgetary pressures

De-escalation criteria

In order for the health board to be de-escalated to the next level of intervention, they must meet the criteria set out below: 

• demonstrate that there is robust financial governance and a robust financial control environment in place with risks minimised
• substantial progress must be made in delivering the level 4 action plan including actions to improve the organisation’s understanding of the existing deficit and key drivers, and development and realisation of opportunities
• an annual plan developed with Board approval demonstrating a substantial financial improvement trajectory and delivering as a minimum the target control total

Strategy and planning intervention

The strategy and planning intervention and focus whilst in level 4 escalation covers the following areas.

The health board will be required to submit and deliver an approvable plan and demonstrate:

• improved integrated planning across the organisation to develop an approvable IMTP, providing a route map towards its longer-term ambition
• if the health board is unable to submit a balanced IMTP for 2025 to 2028, as is the statutory requirement – it will be expected to very clearly set out a credible plan which will deliver the target control total of a £12 million deficit in 2025 to 2026 as a minimum
• good progress in delivering the ministerial priorities, delivery expectations, enabling actions (as set out in the NHS Wales Planning framework 2025 to 2028), accountability criteria and the level 4 requirements

The health board will be required to take action to strengthen its strategic planning and transformation and demonstrate:

• how the clinical strategy and plan are driving decision-making across the organisation
• a Board approved timeline and strategic approach for route map to sustainability
• board-level alignment between strategic direction for transformation of service model and financial obligations

De-escalation criteria

In order for the health board to be de-escalated to the next level of intervention, they must meet the criteria set out below:

• submission of a balanced and credible three-year medium-term plan or acceptable annual plan in line with the current planning framework
• evidence of board clarity on the strategic vision for the organisation
• evidence of a clear roadmap and implementation of the health board’s clinical services plan
• an improved level of Welsh Government confidence in delivery based on an assessment against an agreed planning maturity matrix
• delivery of commitments set out within the health board’s plan, particularly in relation to the ministerial priorities, delivery expectations and enabling actions

The escalation and related interventions detailed within the agreed finance action plan have been designed to support the health board to demonstrate actions and evidence in line with the key objective areas. 

The NHSP&I Financial Planning and Delivery team will work with the health board to support delivery of actions and products detailed within the action plan to gain a clear assessment of the financial governance arrangements in place, key financial challenges (diagnosis), opportunities for improvement and to gain an understanding of plans and actions for improvement. 

The health board’s cumulative and current position is driven by challenges in key resource areas; commissioning; continuing healthcare (CHC), including the associated impact of provider configuration and capacity; prescribing; and workforce. 

The escalation framework and action plan identify ten priority areas and recommendations for potential additional support. In taking forward these actions, the Welsh Government considers that the health board does not have sufficient capacity and capability to deliver the actions required to address this challenge. 

The intervention therefore is a combination of sufficient capacity from an external partner to provide additional support to the organisation, alongside securing specific expertise in key areas such as commissioning. 

The likely delivery model will require procuring additional capacity from a third party, and also secure appropriate specialist expertise for commissioning and CHC in particular. 

The health board will therefore be expected to procure and commission this support directly, ensuring that this additional support operates closely with and responds to the direction of NHSP&I in an oversight capacity, and within the requirements of the agreed level 4 action plan. 

The priority areas for intervention have been identified through the level 4 action plan and are categorised as:

• Green: support required and action needed to commission this support at pace
• Amber: support required but at a later stage once a clear diagnosis is undertaken
• Red: support required but a longer-term requirement after immediate priorities to deliver improvement

Green priority support includes: 

• commissioning and contracting expertise to provide capacity to the health board to review its contracting mechanism, process and approach and to improve process and controls of entering and monitoring commissioned contracts within resources available
• continuing healthcare (CHC) clinical and operational expertise to enhance capacity and review the process and pathways underpinning CHC and NHS-funded nursing care (FNC) and support the development of sustainable solutions
• external planning and transformation capacity and expertise to support the health board in developing and delivering an integrated plan for 2025 to 2026, including effective stakeholder engagement, identification of rapid turnaround actions to support delivery of target control total, and support the longer-term through development of a clear route map to balance, including a focus on opportunities to strengthen planning capability
• additional internal audit days to review the controls and processes within key risk areas that have not been recently reviewed and in key areas such as workforce (for example, bank and agency)

Amber priority support includes:

• pharmacy expertise to assist the health board to assess drivers of growth, mitigate growth through opportunities and review prescribing behaviours
• workforce planning expertise and capacity to establish workforce solutions and strategy to reduce the demand for agency in a rural area and support longer-term sustainability
• operational human resources (HR) expertise to strengthen capacity and support the establishment and implementation of robust engagement and appointment controls

Red priority support includes: 

• external support to lead a board self-assessment, assessment of committees, governance and control effectiveness and change processes
• finance function and business partnering expertise providing an external review of the strategy, capacity, roles and delivery of the finance function to include support for identification and implementation of a change process
• value in health care expertise providing engagement and input to local teams
• communication expertise and support on establishing best practice for engagement and communication within and externally to the health board