Procurement Price Index, Local Inflation Tracking

Norfolk and Norwich University Hospitals NHS Foundation Trust, East of England, Acute

The problem

In light of the economic conditions in 2022/23, it was felt necessary and important to develop a way of having an accurate understanding of how inflation was impacting our financial performance compared to our planning assumptions and provide an evidence base to support performance monitoring of procurement CIP initiatives and budget distribution.

The challenges

We set out to develop an approach that would allow us to accurately track the impact that inflation was having on the cost of our clinical and general supplies, so that we could plan for and budget appropriately and monitor the impact through the year.

What were/are the outputs?

• Ability to track the impact of inflation on our cost base for clinical and non-clinical supplies and understand how this then impacts our financial performance.
• Budget holders have an understanding of the impact of inflation on their cost base.
• Shared methodology for measuring inflationary impacts across the ICS.

What were/are the outcomes?

• More accurate understanding and improved forecasting of inflationary impact on our clinical supplies spend profile
• Improved ability to recognise procurement effort to work against inflationary pressures
• Evidence of different inflation impacts of clinical supplies vs non-clinical supplies

The Innovation

Read the full innovation on Procurement Price Index – Local Inflation Tracking

All documents and resources relating to this innovation can be found in the downloads section at the bottom of the page.

Read now

What the peer-reviewers said

“This application should be recognised as an innovation as a novel piece of work has been undertaken to improve the financial control and processes within the organisation, leading to benefits.”

“Recognising the benefit of creating a local index the innovators have invested a significant level of effort to create a basket of goods that is appropriate and useful for the purpose.”

“The innovation provides a way to deeper understand the price increases experienced at present.”

Get Involved Today