Calculating the minimum funds for 
                    investment
    As set out in Schedule 30 of the Terms and conditions of service for consultants - 
    England (2003), the formula for calculating the minimum funds for investment in new 
    awards each year between 1 April 2018 and 31 March 2022 (four annual award rounds) 
    is
     
       Number of eligible consultants x investment ratio x unit value of an award
    Each element of the formula is dynamic, the number of eligible consultants in an 
    organisation is unlikely to remain static year on year, the investment ratio has been 
    subject to change and the unit value of an award has been updated following DDRB 
    recommendations.
    The funds for investment are cumulative over the four year period. This build up in the 
    level of investment awards reflects previous investment levels as awards were paid on a 
    consolidated basis until retirement.  Under the new arrangements awards are time 
    limited and non-consolidated allowing for reinvestment of the released funds when the 
    award ends. The released funds are then added to the new awards investment for the 
    following year up to 2021/22.
         Calculating the minimum funds for 
                    investment
    This slide pack set out the steps employers should follow to ensure that they 
    have calculated the necessary funds for investment over the four years 
    covered by the interim arrangements. We have deployed an updated method 
    of calculation to simplify the process for employers*.  
    Employers will need to identify their actual spend over the first three years 
    against these calculations. Should there be any discrepancies in the level of 
    spend then these should be rectified during the 2021/22 award round (under 
    the equal distribution approach). 
    The LCEA arrangements from 1 April 2022 have yet to be agreed and will be 
    communicated in due course.
    *See FAQ Q1 under Local clinical excellence awards FAQs > COVID-19 and 2021-22 award round. 
                                                                                     Consultant 
                                Eligibility criteria                                 contract reform
       •   The terms “eligibility” or “eligible consultant” can be  defined in two ways 
           depending on purpose
        
            – Eligibility or eligible consultant for the purposes of determining who can 
               apply for an award and the criteria that they must meet
            – Eligibility or eligible consultant for the purposes of calculating the funds for 
               investment in LCEAs
          
       •   There is a degree of local discretion when applying the former but the latter 
           definition must be applied as per schedule 30 of the 2003 TCS and cannot be 
           varied.
    Eligibility criteria for the purposes of 
    calculating the funds for investment in LCEAs
    • Eligible consultants should have at least one year’s service at consultant level and not hold an 
      Employer Based Level 9, a National Clinical Excellence Award or a Distinction Award. 
      Consultants on fixed term contracts are eligible for the purposes of calculation and to receive 
      an award.
    • Exclusions – there is no requirement that these eligible consultants need to be on 2003 TCS 
      when calculating the funds for investment, with the exception of agency locum consultants, 
      who should be excluded from the calculations. They are also not eligible to receive award 
      funds.
    • Consultant clinical academics (CCAs) employed on honorary contracts - where they have 
      previously had access to LCEA arrangements, it is expected that they would continue to be 
      considered as eligible to receive an award. Where CCAs are deemed eligible to apply they 
      should be included in the funding calculations (as otherwise this would dilute the funding 
      pot). 
    • Those consultants eligible to receive an award during 2018-22 are set out in Schedule 30 of 
      the Terms and Conditions - Consultants (England) 2003.
                                                                                          Consultant 
                                   Investment ratio                                       contract reform
       •    The investment ratio for the years 1 April 2018 to 31 March 2022 for LCEAs rounds 
            are as specified below.
              Year              Additional Funding Ratio                Cumulative Funding Ratio
                            (points per eligible consultant)          (points per eligible consultant 
                                                                               for that year)
          2018-2019                         0.3                                      0.3
          2019-2020                         0.3                                      0.6
          2020-2021                        0.424                                    1.024
          2021-2022                        0.218                                    1.242
        The cumulative build up in the level of investment over the four year period reflects 
        previous investment levels (prior to 2018) as awards were paid on a consolidated 
        basis until retirement.  
        •   The investment ratio is one element of the calculation formula required to 
            determine the level of investment in LCEAs. Full details of the calculation formula 
            for each year is set out in the following slides.